Timing of over-the-counter dollar withdrawals directive wrong - Banking consultant

Banking consultant Dr. Daniel Seddoh criticized the timing of a Bank of Ghana (BoG) directive. This directive halts over-the-counter dollar withdrawals.

Dr. Seddoh believes this move is detrimental to the cedi's appreciation. His comments follow remarks by BoG Board Member Dr. Isaac Adongo on JoyNews' PM Express.

Dr. Seddoh questioned the policy's rationale while the cedi is strong. He stated, "We're saying that the cedi is appreciating." He emphasized that people will prefer the cedi over the dollar.

The financial expert raised three main concerns about this measure. First, he noted that it contradicts the positive trend of the cedi's recovery.

Second, he explained that dollar savings reflect rational economic behavior. Investors seek stability and want to preserve their wealth.

Third, he stressed banks must honor dollar withdrawals if they accept dollar deposits. "If banks can accept your dollar over the counter, they must pay your dollar when you go," he said.

Dr. Seddoh criticized how this issue became public. He stated, "This is not a conversation for a board member to have on radio." He believes discussing it in public was inappropriate.

These comments followed Dr. Adongo's suggestion of withdrawal restrictions during an unaired interview on JoyNews. The Ghana Association of Bankers has denied any official directive from BoG regarding this matter.

GAB Chief Executive John Awuah confirmed no such directive exists for banks. He stated, "We do not have any directive that bars over-the-counter withdrawal of USD."

Mr. Awuah emphasized that banks only act on formal directives from BoG, not individual board members' comments. "We take instructions from the bank under the pen of the Governor," he added on JoyNews Prime.