As an expert in Principles of Banking Law with over 20 years in the Ghanaian banking sector, including senior roles in risk management and lending at institutions like Ecobank Ghana, I draw on practical knowledge of regulations such as the Banks and Specialised Deposit-Taking Institutions Act, 2016 (Act 930), and the Borrowers and Lenders Act, 2020 (Act 1052), which govern secured lending and recovery processes. In Ghana, mortgage recovery is influenced by the Mortgages Act, 1972 (NRCD 96), and customary practices, emphasizing efficient, compliant methods to minimize losses while adhering to Bank of Ghana (BoG) directives on credit risk management.

Options available to PPT Bank Ltd for recovering the GH₵ 1 million indebtedness from Kwame Burger:

1. Power of Sale (Extrajudicial Sale): Under Section 20 of the Mortgages Act, 1972 (NRCD 96), the bank, as mortgagee, can sell the mortgaged property without court intervention after the borrower defaults and a three-month notice period expires (or shorter if stipulated in the mortgage deed). This involves appointing an auctioneer, advertising the sale, and applying proceeds to the debt. Practical example: During the 2017-2019 banking cleanup, banks like GCB Bank used this to recover from defaulted real estate-backed loans, avoiding prolonged litigation amid liquidity pressures.
2. Appointment of a Receiver: Per Section 23 of NRCD 96, the bank can appoint a receiver to manage and sell the property. The receiver collects rents/income from the property (if tenanted) and applies them to the debt. This is useful for income-generating properties, as seen in cases where Stanbic Bank Ghana appointed receivers for commercial mortgages during the post-DDEP recovery phase in 2023-2024, ensuring steady cash flow without full ownership transfer.
3. Foreclosure (Taking Possession): The bank can apply to court under Section 16 of NRCD 96 to foreclose, extinguishing the borrower’s equity of redemption and transferring full ownership to the bank. This is less common due to judicial delays but was employed in historical collapses like UT Bank, where assets were seized to offset insolvency.
4. Sue for the Debt (Personal Action): Independently or alongside security realization, the bank can sue Kwame Burger personally for the outstanding amount under contract law principles, as the mortgage deed creates a personal covenant to repay. This aligns with Act 930’s provisions on debt recovery and can include garnishee orders on his other assets or income. In practice, banks like Access Bank Ghana combine this with security enforcement for comprehensive recovery.
5. Negotiation and Restructuring: Though not strictly a legal “recovery” option, under BoG’s Credit Risk Management Guidelines, the bank can negotiate a repayment plan, extend terms, or accept partial settlement. This was widely used post-2022 DDEP to avoid mass defaults, promoting sustainability.

Recommendation: I recommend the Power of Sale as the primary option. Why? It is the most efficient and cost-effective, bypassing lengthy court processes that can take 1-2 years in Ghana’s judicial system, reducing holding costs and exposure to market fluctuations. In my experience at major banks, this method yields higher recovery rates (often 80-90% of debt) compared to foreclosure, which risks appeals and delays. It complies with BoG’s emphasis on prudent risk management under Basel II/III adaptations, minimizing non-performing loans’ impact on capital adequacy. However, the bank should ensure fair valuation (e.g., via independent appraisers) to avoid undue influence claims, and notify the borrower per legal requirements for ethical practices.