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Introduction
The Ghanaian banking sector clean-up continues to generate major legal battles, and one of the most significant is the case involving Dr Papa Kwesi Nduom, Groupe Nduom, GN Savings and Loans Limited, and the Bank of Ghana.
In a landmark judgment delivered on May 21, 2026, the Court of Appeal overturned an earlier High Court decision and ordered the Bank of Ghana (BoG) to restore the licence of GN Savings and Loans Limited.
Background of the Case
The case arose from the Bank of Ghana’s decision on August 16, 2019, to revoke the operating licence of GN Savings and Loans Limited and 22 others during the financial sector clean-up exercise. The BoG declared the company insolvent and subsequently placed it under receivership.
“These actions were taken pursuant to Section 123 (1) of the Banks and Specialised Deposit-Taking Institutions Act, 2016 (Act 930), which requires the Bank of Ghana to revoke the licence of a Bank or Specialised Deposit-Taking Institution (SDI) where the Bank of Ghana determines that the institution is insolvent,” the Central Bank explained.
The Bank of Ghana subsequently appointed Eric Nipah as a Receiver for the specified institutions in line with section 123 (2) of Act 930.
A list of the 23 insolvent institutions whose licenses were revoked. Source: BoG
BoG explained, “The revocation of the licences of these institutions has become necessary because they are insolvent even after a reasonable period within which the Bank of Ghana has engaged with them in the hope that they would be recapitalised by their shareholders to return them to solvency.”
The Bank of Ghana’s assessment concluded that these institutions “have no reasonable prospects of recovery, and that their continued existence poses severe risks to the stability of the financial system and to the interests of their depositors,” a BoG statement dated Aug. 16, 2019, said.
Displeased with the decision, Dr Papa Kwesi Nduom, the Chairperson of Groupe Nduom, Coconut Grove Beach Resort, and Groupe Nduom challenged the decision in the High Court, arguing that the revocation violated their constitutional rights to administrative justice, property, equality, and non-discrimination on Aug 30, 2019.
But the High Court said the BoG was right in revoking the operating license of the GN Savings and Loans Limited.
“The court ruled that the central bank had acted lawfully in the interest of shareholders and the public, and therefore, the application could not be sustained,” the Pulse reported.
Nduom and the companies appealed the High Court’s January 24, 2024, judgment dismissing their application.
Arguments by the Appellants in the Court of Appeal
The appellants argued that the Bank of Ghana failed to properly account for debts owed by the Government of Ghana, its ministries, departments, and agencies to Groupe Nduom entities, before concluding that GN Savings and Loans was insolvent.
According to them, the government’s indebtedness significantly affected the financial position of GN Savings and Loans and should have been considered before revoking the company’s licence.
They further contended that the Bank of Ghana relied on inaccurate financial information supplied by government officials.
In a Court document sighted by DUBAWA, the appellants argued the BoG’s revocation decision was unfair and unreasonable, and the regulator violated their rights under Article 23 of the 1992 Constitution, which requires administrative bodies to act fairly and reasonably.
The appellants therefore sought several reliefs, including an order of certiorari to quash the revocation decision, restoration of GN Savings and Loans’ licence, and an order compelling the receiver to hand back control of the company to its shareholders.
Arguments by the Bank of Ghana and the respondents
The Bank of Ghana, the Attorney-General, and GN Savings and Loans (under receivership) opposed the application and defended the revocation process.
The Bank of Ghana maintained that it acted within its statutory powers as the financial sector regulator and insisted that GN Savings and Loans was insolvent at the time its licence was revoked.
The respondents also argued that the regulator’s actions were lawful, justified, and necessary to protect depositors and maintain stability in Ghana’s financial system.
Key issues before the Court of Appeal
The Court of Appeal examined the following legal issues:
(a) whether the Bank of Ghana acted fairly and reasonably,
(b) whether the trial High Court properly evaluated the evidence,
(c) and whether the regulator ignored crucial evidence relating to government indebtedness and recommendations made by its own appointed supervisor.
A major issue was whether the BoG unjustifiably ignored reports and recommendations prepared by a supervisor it had appointed under the relevant banking laws.
Decision of the Court of Appeal
At the end of the trial, Ghana’s Court of Appeal ruled in favour of Dr Nduom and the other appellants. See pages 26 to 27 of the Court’s decision.
The court held that the trial High Court failed to properly evaluate the evidence and wrongly allocated the burden of proof.
Justice Francis A. Achibonga, who delivered the lead judgment, stated that the Bank of Ghana acted unfairly and unreasonably by ignoring recommendations from its own appointed supervisor without providing any convincing explanation.
The court described the BoG’s conduct as irrational, unfair, unreasonable, and unjust.
According to the court, if a regulator appoints a supervisor to investigate and submit recommendations, it cannot simply ignore those recommendations without justification.
The court concluded that the Bank of Ghana failed to establish that the revocation of GN Savings and Loans’ licence on grounds of insolvency was justified.
Orders made by the Court
The Court of Appeal consequently quashed the Bank of Ghana’s August 16, 2019, decision revoking the licence of GN Savings and Loans, and ordered the Bank of Ghana to immediately restore the company’s licence. See pages 26 to 27 of the Court’s decision.
The court also ordered the receiver, Eric Nana Nipah, to hand over possession, management, and control of the company’s assets and operations back to the shareholders.
However, the court recognised that during the receivership period, third parties may have acquired interests in some of the company’s assets. It therefore ruled that such third-party interests should be determined on a case-by-case basis and affected parties should be given a hearing.
Concurring opinion
In her concurring opinion, Justice Mariama Sammo agreed with the lead judgment and added that the High Court wrongly placed the burden of proof on the appellants. See pages 28 to 31 of the Court’s decision.
She stressed that under Ghana’s Evidence Act, a party making a positive assertion bears the burden of proving it. Since the Bank of Ghana claimed its actions were fair and lawful, it had the obligation to justify the revocation process.
Justice Sammo further emphasised that public institutions exercising administrative powers must act transparently, fairly, and reasonably under Article 23 of the Constitution.
Conclusion
The judgment is one of the most important legal decisions arising from Ghana’s banking sector clean-up. It raises major questions about administrative fairness, regulatory accountability, burden of proof in constitutional and administrative justice cases, and the limits of regulatory discretion.
The decision also has potential financial and legal implications for the Bank of Ghana, particularly for institutions affected by the financial sector reforms.
The Bank of Ghana has since challenged the Court of Appeal decision at the Supreme Court.
