‘Budgetary constraints delayed cleanup of savings and loans sector’ – BoG Governor reveals

Bank of Ghana Governor Dr. Ernest Addison has acknowledged the incomplete cleanup of the Savings and Loans (S&L) sector, citing budgetary constraints as a key obstacle.

In a January 2 interview, he noted that while progress has been made, some troubled institutions remain operational due to insufficient funds to reimburse depositors.

Dr. Addison emphasized that the issue was financial, not systemic, as these institutions have limited exposure and minimal impact on the broader financial system. He reassured that unresolved issues are part of discussions with the IMF and will be addressed once resources are available.

Reflecting on broader cleanup efforts, he highlighted the government’s generosity in compensating depositors, including accrued interest, making the process costly but effective.

He underscored the need to fully resolve S&L sector challenges to restore confidence and support long-term financial growth.