Group Nduom (GN) Savings and Loans is set to resume operations as the Court of Appeal has ordered the Bank of Ghana (BoG) to restore it’s license, overturning an earlier High Court ruling that upheld the revocation of the financial institution’s operating licence.
The three-member panel further directed that all assets of the bank be returned to its original owners and ordered the Receiver to hand over management of the company to its previous management team.
The ruling marks a major development in the long-running legal battle between GN Savings and Loans and the Bank of Ghana over the controversial banking sector clean-up exercise initiated in 2018.
GN Savings and Loans was first reclassified as a savings and loans company on January 4, 2019, and subsequently renamed GN Savings and Loans Company Limited.
Seven months later, on August 16, 2019, under the leadership of former Bank of Ghana Governor Ernest Addison, the central bank 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, describing the revocation as unlawful, malicious, and unreasonable.
However, on January 24, 2024, the High Court, presided over by Justice Gifty Addo Adjei, ruled in favour of the Bank of Ghana.
The court held that governance deficiencies had rendered GN Savings and Loans incapable of meeting its debt obligations and concluded that the company failed to prove it was solvent at the time its licence was revoked.
Justice Addo Adjei also dismissed claims that the Bank of Ghana acted illegally or unfairly, ruling that the regulator’s intervention was lawful and consistent with Article 130 of the 1992 Constitution.
The court further rejected allegations of discrimination, noting that other financial institutions affected by the banking sector reforms were subjected to similar regulatory actions.
Despite the ruling, GN maintained that the revocation breached existing laws and appealed the decision, leading to the latest judgment by the Court of Appeal.