This is contrary to the former Head of Finance Department at the University of Ghana, Prof. Godfred Bokpin assertion on the clean-up, describing it as decisive.
The International Monetary Fund (IMF) has also lauded the clean-up, describing it as timely and necessary.
But, the member of the Minority Caucus in Parliament said, when the NDC wanted to introduce some sanity in the banking sector, they introduced a GH¢230 million minimum capital.
“We however, agreed that not all banks need the same capital,” Adongo recounted.
He said after setting the GH¢230 million base, they agreed to work with the individual banks to determine level of risk and then determine their minimum capital.
He said that was done so Ghana’s banking sector could have small and big banks “operating in a risk-free environment.”
“We call that Internal Capital Assessment project which will enable us to hand-hold the banks out of their challenges and not collapse them at the least excuse,” Adongo noted.
He said when the NPP took over, all they were determined to do was to collapse the struggling banks. “They introduced a minimum capital of GH¢400 million and they could not wait for the deadline to come.”
He added that the constant reminder of the deadline caused some panic withdrawals which further weakened struggling banks.
Between 2017 and 2019, seven banks went down. The BoG said some of these banks should not have existed at all.
Sovereign Bank, for instance, was cited as getting their license under false pretences, using non-existent capital.
Others run into various liquidity challenges including recording a woeful Capital Adequacy Ratio (CAR).