The Bank of Ghana is in the process of modifying the Non-bank financial law, which will seek to regulate the non-bank financial industry in a bid to articulate the restrictions they have in making investments and both internal and external lending.

A source close to the central bank told ghananewstoday that a committee has been put in place to look at the draft policy leading to a possible approval pretty soon.

The draft policy includes some recommendations made by the International Finance Corporation (IFC) which is actively involved in leasing in the country.

The IFC is asking the central bank to introduce a universal license for non-banks as it currently pertains for banks.

They say, the move will ensure a separate and effective regulation for the non-bank financial institutions which will also ensure a level playing field.

A minimum capital requirement of 25 billion old Ghana cedis has been set by the IFC as the amount the Bank of Gahna should set for the non-banks, should the recommendation be approved.

Currently non-bank deposit takers require a minimum requirement of 15 billion cedis while non-deposit takers require an amount of 10 billion cedis. Should the law inculcate an increment in the capital requirement, it is likely to create mergers and acquisitions in the non-banking sector, as is currently being experienced in the banking sector.

It will be recalled that a chief manager at the Central Bank, Joseph Tetteh told ghananewstoday earlier that the Bank of Ghana has decided to raise the capital requirement to deepen the microeconomic stability and provide basis for effective financial intermediation.

The law will also mandate the liquidity requirements the deposit taking institutions are to maintain and the kind of penalty that are likely to be invoked in case of violation of maintaining the specified liquidity reserves.

It will further outline the corporate governance procedures, which the NBFIs are to abide by and the sanctions that can be made for non-adherence to the specifications of the rules. Credit: ghananewstoday