Commercial banks in Ghana are required to increase their minimum capital by 233.3 percent to 400 million Ghana cedis (90.19 million U.S. dollars), the central bank announced on Monday.

The announcement, signed by Caroline Otoo, secretary of the Bank of Ghana, brings to closure speculations and anxiety about how much the bank was going to raise the minimum capital from the previous 120 million cedis (27.05 million dollars).

“The Bank of Ghana announces for the information of banks and the general public that it had revised upward the minimum paid-up capital for existing banks and new entrants… to 400 million Ghana cedis effective Monday, Sept. 11, 2017,” the announcement said.

It said the increase should be carried out by the banks through either fresh capital injection, capitalization of income surplus, or a combination of both.

The central bank gave all banks, including those granted approval “in principle,” up to Dec. 31, 2018, to comply with the directive.

“All pending applications for banking license which are without the ‘Approval in Principle’ are required to meet the new minimum capital requirement of 400 million cedis and feasibility reports accompanying such applications should be amended,” the statement said.

The central bank forbade banks from capitalizing revaluation reserves, reserves on financial instruments through other comprehensive income, credit risk reserves and unaudited profits.

Last month, the Bank of Ghana revoked operating licenses of two local banks, UT Bank and Capital Bank, due to persistent liquidity challenges, the statement said. Enditem

Source: Xinhua/NewsGhana.com.gh

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