Ordinarily, members of the IMF family receive technical assistance to build relevant capacity. The appointment of resident advisor on banking supervision is not ordinary but an attempt to rescue the banking and financial sector from poor banking supervision , liquidity risk and apparent fiscal dominance.
The main advantage of this development maybe the end of discriminatory supervision. Perhaps there will be strict regulatory and supervisory requirements . The boardrooms will be inundated with tough regulatory environment and less politics.
Now, the Bank of Ghana will be supervised. Reports will soon have to be passed by the resident advisor . Every thing will be cleared by the resident advisor before it is carried out. Tough time for the authorities.
The activities will focus on minimum capital requirements including tier-1 and tier-2 capital, supervisory reviews and market discipline. Issues relating to credit risk, operational risk, liquidity and regulatory risk will be firmly dealt with .
The work of the resident advisor will be broad and may ensure enhanced corporate governance and democratic directives. The resident advisor is likely not going to allow interference. Hope by the end of the three years advisory work, banking supervision with be strengthened and a culture of professionalism and independence banking supervision will emerged.
