High Court reverses BoG’s revocation of CDH Savings and Loans licence
An Accra High Court has overturned the Bank of Ghana’s (BoG) 2019 decision to revoke CDH Savings and Loans Company Limited’s operating license, directing both parties to pursue resolution through arbitration. In a ruling delivered on November 1, 2024, Justice Brew criticized the BoG’s handling of the matter, emphasizing that the central bank’s approach did not align with constitutional standards for fair administrative actions.
The court found BoG’s two-week deadline for CDH to liquidate assets to resolve its liquidity challenges “unreasonable and unfair.” The BoG had revoked CDH’s license on August 16, 2019, attributing the decision to CDH’s alleged liquidity issues due to its inability to liquidate repossessed collateral and meet depositor withdrawal demands. In response, CDH’s shareholders, CDH Financial Holdings Limited, challenged the revocation in court, arguing procedural unfairness and seeking to protect its operations pending arbitration.
Justice Brew referenced Article 23 of Ghana’s 1992 Constitution, which mandates fair and reasonable administrative actions, in his decision to overturn the revocation. The ruling highlights legal protections for businesses facing regulatory actions and underscores the importance of due process within Ghana’s financial sector. The case will now move to arbitration, where CDH and the BoG will negotiate a potential resolution.
