The Director-General of the SEC, Daniel Ogbarmey Tetteh told Bloomberg that, fund managers who will not be able to meet the new capital will have to "fall out".

He said the directive, which will require law changes, will be fully communicated by the end of the year for compliance by December 2020, he said.

Mr Tetteh further explained that existing capital requirements were too low, allowing too many people to start fund-management companies which hindered supervision.

“Some who will not be able to meet that capital will have to fall out,” he said. “If you are a fund manager you must keep to the obligations in the contract with your clients. You signed an investment contract to do ABC -- just stick to it.”

The markets regulator is seeking to strengthen the industry and restore confidence as at least 70,000 investors struggle to access savings that were trapped in the aftermath of a separate clean up of banks, savings and loans companies, and micro-lenders.

The SEC is investigating 21 fund managers for sinking as much as 5 billion cedis in risky investments such as unlisted bonds, direct private equity stakes and related-party deals that are difficult to liquidate. Another 4 billion cedis is tied up in fixed-term investments, which are now starting to trickle in after the government stepped in and bailed out failed banks with 11.2 billion cedis and microlenders with another 925 million cedis.

The SEC has also told fund managers, who jointly oversee 25 billion cedis, to include “very liquid or near-liquid” instruments in their portfolios in future, Ogbarmey Tetteh said. The regulator is also engaging the central bank, the finance ministry and the receiver of the failed lenders for a quick disbursement of bailout funds to meet client withdrawals, he said.

Ogbarmey Tetteh urged investors not to panic, saying that the SEC has their “best interests at heart.” The SEC will more strictly enforce the usage of information-technology platforms, clamp down on related-party deals and better police money managers who promise guaranteed returns, he said.

The number of fund managers dropped to 140 in 2018 from 155 a year earlier as some voluntarily shut down and the licenses of others were revoked, according to the SEC.