Ensure constant education on your mandate – Bawumia to GDPC

The Vice President, Dr. Mahamudu Bawumia has called on the Management and Board of the newly established Ghana Deposit Protection Corporation (GDPC) to ensure that it engages in constant education of the Ghanaian public about the scheme, it’s operations and the benefits that it offers depositors.

Addressing the International Association of Deposit Insurers (IADI) Africa Regional Committee (ARC) Technical Assistance Workshop on the theme, ‘Deposit Protection, a Catalyst for Financial Stability’ at the Marriott Hotel, Dr Bawumia said the Corporation is assured of government’s support as far as its mandate of ensuring that it grows to become an important safety net in the Ghanaian financial sector is concerned.

“Operating in a largely reformed financial sector, the Corporation needs to ensure the necessary public education about the scheme, its operations and benefits to every depositor,” Vice President Mahamudu Bawumia said.

“Such an education is an invaluable public good and we must get on with it as soon as possible,” Dr Bawumia added.

The Vice President further urged the Board and Management of the GDPC to be “innovative and ensure that the scheme is operated in a manner that is consistent with protecting depositors’ funds.” He extended the appreciation of government to the Federal Republic of Germany through KfW for their financial and technical support towards the establishment of the Ghana Deposit Protection Scheme as well as their continued assistance through the process of getting the Corporation sufficiently operational.

David Walker, the Secretary-General of the IADI in his remarks noted that deposit insurance is a growing phenomenon the world over and it is a good mark for Ghana for joining the fraternity of deposit insurers.

“In IADI, the Africa regional community is the fastest-growing region and I think this is an area where we are seeing a number of deposit insurers, in addition to Ghana, that is setting up systems that are coming on stream so I think this is just really a pivotal time in the history of Africa,” the Secretary-General of IADI stated.

“Deposit insurance has become an integral part of Africa’s financial development and I think that is something that you can be very proud of,” Mr. Walker added.

In his statement, Governor of the Bank of Ghana (BoG), Dr. Ernest Addison, said it has become increasingly very important for the Central Bank to take interest in deposit insurance in light of bank failures in the country.

“To curtail the potential effects on state resources and enhance public confidence in financial systems, the establishment of Deposit Protection Scheme to protect depositors from loses in the event of the failure of the banks or SAIs has become the norm,” Governor Addison said.

“Ghana does not wish to be left behind in this global drive to develop deposit insurance schemes to maintain financial stability. The Ghana Deposit Insurance scheme is long overdue. It is for this reason that the Ghana Deposit Protection Corporation was established by Ghana Deposit Protection Act 2016, Act 931 as amended to protect small depositors against loses in the event of the materialization of an insured financial sector shock,” the Central Bank Governor added.

The International Association of Deposit Insurers (IADI) was formed in May 2002 to enhance the effectiveness of deposit insurance systems by promoting guidance and international cooperation. Members of IADI conduct research and produce guidance for the benefit of those jurisdictions seeking to establish or improve a deposit insurance system.

Members also share their knowledge and expertise through participation in international conferences and other forums. IADI currently represents 92 deposit insurers and is a non-profit organisation constituted under Swiss Law and is domiciled at the Bank for International Settlements in Basel, Switzerland.

Source: kasapafmonline.com