Several millions of cedis of pension funds are locked up with some of the failed financial institutions (banks, savings and loans frims, finance houses and investment companies), Classfmonline.com has gathered.

This is making it difficult for some tier-two pension funds to execute their financial obligations to retirees, as well as putting the future of millions of Ghanaian workers in danger.  

The situation also suggests that the financial sector crisis is far from over.

Classfmonline.com also gathers that some health insurance companies are also challenged by the financial sector problems because they cannot retrieve their locked-up funds with some of the failed financial institutions. 

The Finance Ministry is seeking parliamentary approval for GHS15.6 billion to save the financial sector from a possible collapse.

In a memo to Parliament, Finance Minister, Ken Ofori-Atta, contended that the financial sector is much interconnected and, therefore, instance troubles from the banking sector could easily spillover to the pensions industry, threatening the future of millions of workers.

The memo indicated that GHS11.65 billion of the requested amount would be used to protect depositors of the nine local banks that lost their licences between 2017 and 2019 over regulatory breaches. Those banks include Capital Bank, UT Bank, The Construction Bank, Royal Bank, Sovereign Bank, uniBank, The Beige Bank, Premium Bank and Heritage Bank. 

The case of Heritage Bank was, however, peculiar because the revocation of its licence had nothing to do with misapplication and misappropriation of depositors’ funds.

The Finance Ministry’s statement said the rest of the approved funds will be used to take care of depositors in collapsed institutions in various other segments of the financial sector such as savings and loans firms, finance houses and fund management companies.

The total assets of the pension industry is estimated to be over GHS10 billion, according to the National Pensions Regulatory Authority.