My Remarks as Chairman of the Ghana Banking Awards Night – 26th May 2012

11^TH GHANA BANKING AWARDS ON THE THEME ‘LEVERAGING ICT TO TRANSFORM THE FINANCIAL SERVICES SECTOR.

Distinguished Ladies and Gentlemen,

It’s an honour to chair this august awards night. I am also glad to be among bankers, economists, captains of industry and other importance citizens of this country.

While I accept to chair this prestigious ceremony, I wish to draw minds, particularly the banks to free fall of the country’s currency and the impact it is having on the economy. For us at Graphic where about 90% of our inputs are imports and we sell in cedi. The depreciation of the cedi is bad news for us generally because as a nation the trade deficit is largely against us, the net effect of the depreciation is negative.

I am aware of the tremendous roles you have played and continue to play in stabilizing the economy among others things and it is against this background that I urge all banks to help devise pragmatic and innovative solution to arrest the further depreciation of the cedi against the major currencies particularly the dollar.

Over the years, our economy has seen some relative stability, at least from the birth of the 1992 constitution, we have witnessed a fall in the value of the cedi only when it is getting close to the general elections and this, as we all know, erodes the gains the economy has chalked.

It is against this background that, we all need to find a lasting solution to this challenge and I trust the role of the banks in this direction is very much required.

I know that you the banks will say that you are just intermediaries in the foreign exchange trade, but you agree with me that of the 3 markets of the foreign exchange, it is the Interbank rates that has seen the a lot of the volatility, about 11% year to date and then tends to affect the forex rates, which has then done over 15%. So in as much as the regulator, BoG and the government have a greater roll to play, and you have also been working with the Central bank, you still cannot be passive. It is the reason why the theme for today’s awards is apt, you need to leverage ICT to transform the interbank market to make it more efficient and transparent. Lets speed the transformation onto an Electronic platform, so that with real time information we will take out the volatility that seem to characterize the foreign exchange market, and lets play close to perfect market situation.

You all know that currently our trade with Asia is largely informal, apart from 2 of the banks that have set up Asian operations, and most of the people who trade within the Asian markets, carry cash with its associated risk to the businessmen. But because of the lack of information about the volumes and timing of these outflows, it is difficult for its planning and management. Information is key, it is in the same light that Banks’s reporting to the Central bank should move from the historical reporting to real time, in today ICT world you have the ability and capacity to do this.

I appreciate the point you bankers make that there should be some policy and regulatory changes, especially when it comes to the retention policy for companies who trade and get Forex, so that when they repatriate the forex into Ghana they should not just keep them in their account but offer them BoG when they do not have immediate need of them. Additionally we should have regulation against Ghanaians converting their cedi and saving them in their Dollar accounts. But let me be quick to add that the greater responsibility also lie with the Central Bank, who though have started doing something, need to move faster. I also urged the Bank of Ghana to open up to the commercial banks to enable them to contribute their quota to the challenge at hand.

But again you the Banks as good corporate citizens owe it to yourselves and Ghana to point to your clients who break the laws when it comes to some of these forex transactions. Additionally you should improve your relationship with the Central bank and without declaring the identities of clients, inform the BoG of some of these movements, all to help manage the volatilities out of the market.

But all of us as Ghanaians, captains of industry gathered here, including me need to move away from the dollarization of our economies where some of us are all quoting our products and services some illegally in forex. I believe we should be copying from some of our neighbors, where even when you get to their hotels, they will not accept your dollar but their local currencies. Maybe we should start looking at that law that allows some businesses to quote some service in forex but transact the business into Cedis at the day’s prevailing rate. Me, in my non-financial mind believe it could also be accounting for our challenges. We need to gather around as Ghanaians and deal with this problem.

May I also draw your attention to a call by Dorothy Gordon, the Chief Executive Officer of the Kofi Annan ICT Centre, to the fact that, there is the need for banks to overhaul their IT platforms to make it virtually impossible for hackers to evade their systems.

This I find necessary because of the gradually move to a cashless society where this mobile money service would be and should be the major form of payment for goods and services as pertains in Kenya, the Impersah.

We are aware that most often, the banks who detect and fire their staff, including the IT teams who have indulged in financial malfeasance, are reluctant to disclose the identity of such persons for what they term as security reasons.

However, I feel that it is time we name and shame such people publicly to prevent them from resurfacing in other areas of the economy. Naming and shaming may be difficult but for the sake of the Ghanaian economy we should do so.

Banks also need to firm up their security systems and ensure that they separate IT personnel from the security people.

I guess you can find more advice on that in the Special Graphic Business Supplementary on the 11^th Ghana Banking Awards. I guess everybody here has a copy of that special edition in his or her brochure.

Without much ado, I wish to say once again that I accept to be in the chair while hand over the microphone to Kojo Oppong Nkrumah, our Master of Ceremony for the night to direct proceedings while I watch him behind the scenes like I use to do in the past when I was his chief servant.

May the deserving banks carry the day (& UT Bank won the Bank of the Year – added after the awards ceremony)

I Once Again, I Thank You.

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