The Bank of Ghana (BoG) has shockingly collapsed five banks in the country and created a new bank to manage the affairs of the struggling outfits, sending massive to the banking industry in the country.

Sovereign Bank, Royal Bank, Beige Capital, Construction Bank and Unibank have been forced to fold after they failed to raise the needed capital to prove they can stay afloat.

The central bank has now created the Consolidated Bank Gh. Ltd to take over some struggling banks who were tipped to be on the verge of total collapse.

The five financial institutions run into liquidity challenges which forced the Bank of Ghana to act to prevent customers and thousands of Ghanaians from losing monies saved at the bank.

Government has made 450m cedis available for the Consolidated Bank as starting capital and has named Daniel Addo as its CEO.

At a press conference in Accra, the Governor of the Bank of Ghana Ernest Addison explained the Sovereign Bank obtained their license under false pretence, an act that could attract criminal charges.

The bank, he said, is insolvent.

He also said Beige and Construction Bank used fictitious and non-existent capital to obtain licenses. The banks therefore obtained licenses under false pretenses.

The governor assured clients of the affected banks their deposits are safe. It has also transferred their staff to the Consolidated Bank.

"We do not expect any immediate job losses" he said.