Ghana's Securities and Exchange Commission has banned 21 fund managers from accepting new investments while it investigates them for alleged breach of rules by placing clients' money in illiquid assets, Bloomberg News reported.
The alleged breach resulted in as much as 9 billion cedis in investments being locked up in the system, including around 5 billion cedis trapped in risky and illiquid investments and 4 billion cedis in fixed-term investments with banks rescued during an overhaul of the banking system by Ghana's central bank, according to the report. The cleanup reduced the number of banks in the country by a third and prompted a bank run that overflowed into the fund management industry, Bloomberg noted.
The Bank of Ghana in 2017 raised the minimum capital requirement for local lenders to 400 million cedis from 120 million cedis, prompting consolidation in the industry.
As of Aug. 15, US$1 was equivalent to 5.41 Ghanaian cedis.