The Chief Executive Officer of Dalex Finance, Joe Jackson, has cautioned that the restoration of the licence of GN Savings and Loans does not automatically mean the institution has fully recovered.
Speaking in an interview on JoyNews’ Top Story programme on Thursday, May 21, Mr. Jackson said rebuilding the financial institution and restoring public confidence would be a difficult and lengthy process.
According to him, many people may mistakenly assume that the Court of Appeal ruling immediately returns the institution to full operation, but banking involves far more than possessing a valid operating licence.
“A bank is not just a licence. A bank is a system. A bank is confidence. It is capitalization. It is governance. It is liquidity. It is regulatory supervision. It is even just the public perception of who you are,” he stated.
Mr. Jackson questioned whether the operational, financial and governance structures necessary for a functioning financial institution had also been restored alongside the licence.
“Even though a licence has been restored, have all other things been restored?” he asked.
He stressed that the ruling should be viewed as the beginning of a recovery and rehabilitation process rather than a complete revival of the institution.
“This begins the process. It’s not that simple,” he noted.
The financial analyst argued that years of inactivity and uncertainty had significantly weakened the institution, making any attempt to re-enter the banking sector extremely challenging.
“Resurrection of GN would be tough because the institution has been put to bed in a coma for all these years,” he remarked.
Mr. Jackson identified public trust as one of the most critical challenges the company would face if it intends to resume active operations.
He suggested that the institution may need negotiated restructuring, recapitalisation, legal settlements and strategic partnerships to rebuild credibility and satisfy regulatory requirements.
“This is legal rehabilitation. This is the time for negotiated restructuring. This is the time for maybe even damage. This is the time for legal leverage and bringing in an external partner,” he stated.
He further indicated that GN Savings and Loans might not return in the same form it existed before Ghana’s banking sector cleanup exercise.
“GN Bank, as we knew it, may never come back the way we knew it. It may come back under a new licence, it may come back with new guys, but there are multiple hurdles to be faced with the central bank and its regulatory compliance,” he added.
Mr. Jackson’s comments follow a unanimous decision by the Court of Appeal to restore the licence of GN Savings and Loans after overturning an earlier High Court ruling that upheld the revocation of the institution’s licence during Ghana’s 2019 banking sector cleanup.
The appellate court ruled that the decision by the Bank of Ghana to revoke the licence was unfair and unreasonable.
The court subsequently ordered the receiver to hand over possession, management and control of the institution’s assets and operations back to its shareholders.
