The Court of Appeal has ordered the Bank of Ghana (BoG) to restore the operating licence of GN Bank, overturning an earlier High Court decision that upheld the revocation of the bank’s licence during the banking sector clean-up exercise.
The three-member panel also directed that all assets of the bank be returned to its original owners and ordered the Receiver to hand over management of the institution to its former management team.
The ruling represents a significant turn in the prolonged legal dispute between GN Bank and the Bank of Ghana over the controversial financial sector reforms introduced in 2018.
GN Bank was downgraded to a savings and loans company on January 4, 2019, and subsequently renamed GN Savings and Loans Company Limited.
Later, on August 16, 2019, the Bank of Ghana, under the leadership of former Governor Ernest Addison, revoked the company’s operating licence and appointed Eric Nana Nipah as Receiver.
The owners of GN Savings and Loans, led by Papa Kwesi Nduom, challenged the decision at the High Court in Accra on August 30, 2019, arguing that the revocation was unlawful, malicious and unreasonable.
However, on January 24, 2024, the High Court ruled in favour of the Bank of Ghana.
Presiding judge, Justice Gifty Addo Adjei, held that governance failures had left GN Savings and Loans unable to meet its debt obligations and ruled that the company failed to prove it was solvent at the time its licence was revoked.
The court also dismissed claims that the central bank acted illegally or unfairly, stating that the intervention was lawful and in line with Article 130 of the 1992 Constitution.
Justice Addo Adjei further rejected allegations of discrimination, noting that other financial institutions affected by the banking sector reforms faced similar regulatory measures.
Despite the High Court ruling, GN Savings and Loans maintained that the revocation breached existing laws and proceeded to appeal the judgment, resulting in the latest decision by the Court of Appeal ordering the restoration of the bank’s licence and assets.