What killed Ghana's savings & loans companies

1. 17 of 23 cited related-party exposure

   Compute the related-party limit from filed data, not from the institution’s word

   The most common stated cause. The notice records related-party exposure of GHS 160.10m from uniCredit to uniSecurities; eight related companies at First Allied overdrawn by more than GHS 100m; and, at Global Access, a GHS 2.91m loan contracted by the majority shareholder that was injected as equity, with the liability, in the Bank of Ghana’s words, “concealed as a suspense account”. The 25% cap was already law. What was missing was any way to see the exposure before the institution declared it.

   • Beneficial-ownership filings for every affiliate and connected party, updated on change, not self-declared at examination time
   • Exposure against the 25% limit computed automatically from prudential returns, rather than asserted by the institution
   • Consequences that reach individuals: the Fit and Proper Persons regime already allows disqualification of directors behind defaulted related-party facilities. The open question is how often it is used
2. 15 of 23 cited misreporting or false records

   Verify what a stressed institution reports instead of accepting it

   The gap between reported and adjusted figures was not marginal. Ideal Finance reported a capital adequacy ratio of 0.52%; the Bank of Ghana’s adjustment put it at −52.18%. FirsTrust reported shareholders’ funds of −GHS 99.46m; adjusted, −GHS 174.10m. Of First Allied the notice states that reported deposit liabilities were “grossly understated … to conceal losses over the years”.

   This is the same event as the finding above, not a separate one: 14 of the 17 related-party cases also involved misreporting. On the regulator’s account the two travel together, which is why supervision built on self-reported numbers will always arrive late.

   • Risk-triggered independent verification: once an institution trips defined stress indicators, its returns are verified by an independent party at its own cost
   • Auditor accountability: Women’s World Banking’s external auditors did flag material going-concern uncertainty. Most did not, on institutions in far worse condition. That difference should carry consequences
3. 10 of 23 cited governance failure

   Enforce the governance rules at the level of the individual director

   Governance failure sits underneath the other two causes rather than beside them: a board that functions does not approve related-party exposure at twelve times the statutory cap, and does not sign off accounts it knows to be wrong. The Corporate Governance Directive issued in 2018 sets board composition, tenure limits and key-management criteria. It arrived after these institutions had already failed, so this dataset cannot test it. What the dataset does show is what an unchecked board produced.

   • Board composition, meeting attendance and committee membership published, so the structure is visible outside the supervisor
   • Personal liability for directors who approve facilities outside the statutory limits
   • Governance compliance tested at examination rather than confirmed on filing
4. 6 of 23 ignored the regulator’s own findings

   Attach a consequence to ignoring an examination finding, and publish the clock

   Six institutions were examined, told what was wrong, and did nothing. Nothing followed. Four had stopped filing prudential returns altogether. Sterling stopped filing in May 2010 and kept its licence until 2019. The powers were there: s.107(1)(e) already makes failure to submit records a ground for official administration, and s.123(1) obliges revocation once insolvency is determined. What is absent is any period within which that must happen, and the median interval ran to 927.5 days.

   • Automatic escalation: a defined number of missed returns, or an unremedied examination finding, triggers formal notice, then a supervisory visit, then a presumption that s.107 grounds are met
   • Publish the corrective-action clock: the date it started and the date it expires. A deadline only the supervisor can see is a discretion, not a deadline
   • A written, published justification for every extension of the s.105/106 period, countersigned at board level. Forbearance may sometimes be right; it should be a recorded decision with a name attached
   • An annual report on ss.104–106 compliance. On this evidence, that figure would have been 0 of 20
5. 360,000+ depositors GHS 5bn of public money committed

   Fund depositor protection ahead of the failure, not after it

   The four findings above are about institutions. This one is about who paid for them. Across the whole clean-up the Receiver recorded over 360,000 depositor claims worth about GHS 6.4 billion, and the state committed GHS 5 billion to settle them, for institutions whose stated reasons for failure cite related-party exposure in 17 of 23 cases.

   The Ghana Deposit Protection Corporation, established under Act 931 and operational from 2019, is the structural answer to that, and it now exists. What remains open is whether coverage limits match actual deposit sizes, whether premiums are risk-weighted so that badly-run institutions pay more, and whether the fund could absorb a concentrated failure without recourse to public money. All three are answerable with data the Corporation already holds.

   These are sector-wide figures covering all 409 resolved institutions, not the 23 charted above, and they are not comparable with the GHS 2.30bn net-worth deficit shown here.

What has already been done. Since 2018 the Bank of Ghana has issued the Corporate Governance Directive (2018), the Fit and Proper Persons Directive (2019) and the Large Exposures Directive (September 2025), raised minimum bank capital to GHS 400m, and brought the Ghana Deposit Protection Corporation into operation. None of the above is offered as a novel insight. The gap that remains is not the rulebook: it is that missing a statutory supervisory deadline still carries no consequence, and no disclosure.