Nearly seven years after the collapse of GN Bank, its founder and key shareholder, Dr Papa Kwesi Nduom, is still locked in a protracted legal and public battle with the Bank of Ghana (BoG), as fresh clarifications from the central bank dismiss renewed claims that the bank’s licence has been restored.
The controversy has revived national debate over the banking sector clean-up and the fate of indigenous financial institutions affected by the reforms.
The Governor of the Bank of Ghana, Dr Johnson Asiama, has categorically denied reports suggesting that GN Bank’s licence has been reinstated, describing such claims as false and misleading.
In an interview, he explained that the licence revocation carried out in 2019 remains in force and that no administrative decision has been taken by the central bank to reverse it. According to him, the matter is now strictly before the courts, following a legal challenge mounted by GN Savings and Loans Company Limited, the downgraded successor of GN Bank.
At the heart of the dispute is an ongoing court case in which GN Savings and Loans is contesting the legality and justification of the licence revocation.
The case, which has been pending for some time, is expected to be determined soon, making the judiciary the final arbiter in a battle that has blended financial regulation, politics, and public sentiment.
Until a court ruling is delivered, the BoG maintains that the revocation stands and that no restoration of licence has occurred, either formally or informally.
The central bank has consistently defended its 2019 decision, framing it as a necessary intervention to protect depositors and preserve financial sector stability.
Dr Nduom subsequently petitioned President John Mahama who had just being elected to return his revoked license.
In earlier public explanations, including interviews in 2024, BoG officials insisted that GN Bank’s operations posed systemic risks due to deep-rooted regulatory and financial weaknesses.
These, they argue, made regulatory action unavoidable, regardless of the bank’s size, popularity, or political influence.
In a detailed statement issued in August 2019, the BoG outlined multiple regulatory breaches by GN Bank, including failure to meet capital adequacy requirements, weak liquidity positions, and serious governance and risk management failures.
The regulator further cited high levels of non-performing loans, excessive related-party transactions, money laundering and poor corporate governance structures as factors that steadily eroded the bank’s financial health.
“A recent Bank of Ghana investigation conducted at GN revealed that a significant amount (USD62,255,516.93, GBP718,528.59 and EUR4,200) of depositors’ funds held with GN had been transferred to International Business Solutions (another company owned by Groupe Nduom and which is based in the U.S.A) without any documentation to support such transfers in breach of section 19 of the Foreign Exchange Act 2006, Act 723, Section IV of Bank of Ghana Notice No. BG/GOV/SEC/2007/4, and subsequent Bank of Ghana Notices issued in August 2014 prohibiting such practices”, the statement indicated.
According to the BoG, repeated directives were issued to the bank, including capital restoration plans and operational restrictions, but these measures failed to stabilise the institution.
GN Bank’s troubles, however, did not emerge overnight. The institution began operations in 1997 as First National Savings and Loans (FNSL) Company Limited and grew steadily before being upgraded to a universal bank in September 2014.
The upgrade marked a major milestone, enabling it to expand rapidly across Ghana. Within a few years, GN Bank had built one of the largest branch networks in the country, becoming a dominant presence in both urban and rural communities and positioning itself as a symbol of indigenous financial enterprise.
Behind the rapid expansion, regulators say, were structural weaknesses.
The BoG’s assessments revealed that GN Bank’s growth was not supported by adequate capital buffers or strong risk management systems. Prudential ratios were consistently breached, liquidity pressures mounted, and asset quality deteriorated.
By the time Ghana embarked on its sector-wide banking reforms, GN Bank was described by regulators as severely undercapitalised and technically insolvent.
