The Bank of Ghana’s (BoG) decision to revoke Ideal Finance Limited’s operating license was overturned by the High Court’s Human Rights Division.
Delivered on Monday, March 10, the decision represents a significant win for the now-defunct banking firm in its legal dispute with the central bank.
The Bank of Ghana was found to have not followed all the correct steps necessary to have Ideal Finance’s license revoked by the court.
As part of its effort to clean up the financial sector, the BoG had canceled Ideal Finance’s license, citing insolvency and inadequate governance. But the company’s legal status was essentially restored when the court decided that the revocation was unwarranted.
Ideal Finance, GN Savings and Loans, First Allied Savings and Loans, Midland Savings and Loans, and Unicredit Savings and Loans were among the 23 insolvent savings and loan and finance house companies whose licenses were terminated by the Bank of Ghana on August 16, 2019.
The central bank used the fact that these banks were still insolvent even after being given enough time to recapitalize as justification for its action.
In an effort to restore stability and confidence to the banking system, the BoG cleaned up the financial industry, but it also caused many institutions to fail, putting stakeholders and depositors in financial jeopardy.
Source: newsthemegh.com