Addressing a news conference on Monday, Dr Anderson said the continuous operation of UT Bank and Capital Bank would have jeopardised not only their depositors’ funds but also threaten the banking system.

“UT Bank and Capital Bank were heavily deficient in capital and liquidity and their continuous operation would jeorpadise not only their depositors’ funds but also pose a threat to the banking system,” Dr Anderson said.

“It has therefore become necessary for us to revoke their banking licenses and approved this transaction to allow GCB, the large bank with the right balance sheet to take over all the deposits and selected assets of the two banks,” he said.

The BoG on Monday revoked the licences of UT Bank Ltd and Capital Bank Ltd.

It also approved a Purchase and Assumption transaction with GCB Bank Ltd that transfers all deposits and selected assets of UT Bank Ltd and Capital Bank Ltd to GCB Bank Ltd.

Dr Anderson said despite repeated agreements between the BoG, UT Bank and Capital Bank to implement an action plan to address their significant shortfalls, the owners and managers were unable to increase the capital of the banks to address the insolvency.

On the choice of GCB Bank, he said, it was chosen among three entities on the basis of purchase rights, cost of fund, branches to be retained and staff to be employed and the impact on the acquiring bank’s capital adequacy ratio.

Dr Anderson said the acquisition of selected assets and deposits liabilities of UT Bank and Capital Bank was part of the efforts of GCB Bank to further broaden its reach and grow its balance sheet to support the fast growing economy.

“This is in line with our broad objective to position the banking sector to support government’s transformational agenda,” he added.

He said the BoG would carry out a thorough investigation into the corporate governance structure of UT Bank and Capital Bank and appropriate action would be taken against shareholders, directors, and key management personnel, who are found to be culpable.

Overall, Dr Anderson said the banking system remained strong and well capitalised and assured customers of the two banks that they would not lose their deposits and encouraged them to continue doing business with the new acquiring bank.

Mr Ray Sowah, the Managing Director of GCB Bank, said the corporate entity has the financial muscle and expertise to take over the two banks.

On his part, Mr Kofi Yamoah, Managing Director of the Ghana Stock Exchange, said the body had collaborated very well with the BoG by working closely with the Banking Supervision Division and the Governor’s office.

He said as far as the Exchange’s rules and procedures were concerned steps must be taken to have an exit mechanism for shareholders of UT Bank.

“But that exit mechanism must be on the basis of guidelines and notices that the BoG may issue.

”So the exchange may not act alone but would still have to collaborate with the BoG in terms of guidelines and notices that would be issued as consequential matters following from that,” he added.