Court of Appeal orders BoG to restore GN Bank licence with immediate effect

The Court of Appeal has directed the Bank of Ghana to reinstate GN Bank’s operating licence, effectively overturning an earlier High Court decision that had upheld the central bank’s revocation of the institution’s licence.

The three-member appellate panel also ordered that all assets belonging to the bank be returned to its original owners and instructed the appointed Receiver to hand over control of the institution to its former management team.

This ruling represents a significant turn in the protracted legal dispute between GN Bank and the Bank of Ghana, which stems from the controversial financial sector cleanup exercise launched in 2018.

GN Bank was initially downgraded to a savings and loans institution on January 4, 2019, and subsequently renamed GN Savings and Loans Company Limited.

Later that year, on August 16, 2019, the Bank of Ghana, under then-Governor Ernest Addison, revoked its licence and appointed Eric Nana Nipah as Receiver.

The company’s owners, led by Dr. Papa Kwesi Nduom, challenged the decision at the High Court in Accra on August 30, 2019, arguing that the action was unlawful, unfair, and unjustified.

However, on January 24, 2024, the High Court ruled in favour of the Bank of Ghana. Presided over by Justice Gifty Addo Adjei, the court held that GN Savings and Loans had serious governance challenges that affected its ability to meet financial obligations and failed to demonstrate solvency at the time its licence was withdrawn.

The court further ruled that the Bank of Ghana acted within its legal mandate under Article 130 of the 1992 Constitution and dismissed claims of unfair treatment, noting that similar actions were taken against other financial institutions during the sector cleanup.

Despite the ruling, GN Bank pursued an appeal, which has now resulted in the Court of Appeal’s decision to restore the licence and reverse the earlier judgment.