By: Frank Owusu-Ofori
The Monetary Policy Committee (MPC) of the Bank of Ghana has revealed that the country’s banking sector recorded strong growth during the first nine months of the year.
According to the Governor of the Bank of Ghana, Dr. Kofi Wampah, the sector remained relatively stable, benefiting from healthy capitalisation as well as sound liquidity and profitability.
He said the total assets of the banking industry recorded growth of GH¢8.8 billion from September 2012 till September 2013.
“Total assets of the banking industry as at the end of September 2013 rose to GH¢33.9 billion, from GH¢25.1 billion in September 2012. This was driven mainly by advances, which accounted for 46.6 per cent of the total,” he noted.
He added that “the asset growth was mainly funded by deposits which recorded an annual growth of 18.1 per cent to GH¢21.1 billion at the end of September 2013.”
However, despite the GH¢8.8 billion growth in the total assets, the banking industry had some challenges to grapple with.
“The non-performing loans (NPL) ratio within the banking industry decreased to 12.3 percent in September 2013, from 13.1 percent in September 2012, while the ratio excluding the loss category, declined to 5.0 percent from 6.5 percent in the same period last year,” he said
Interest rates on the money market have also broadly declined.
Between December 2012 and October 2013, “the 91-day instrument declined to 19.9 percent from 23.1 percent. Similarly, the 182-day declined to 19.9 from 23.0 percent. The 1-year note rate fell to 19.0 percent from 22.9 percent, while the rate on the 2-year note declined to 19.3 percent from 23.0 percent.”
Whereas the 3-year bond rate fell to 19.2 from 21 percent, the rate on the 5-year bond issued in September was 19.0 percent.
The weighted average interbank rate declined to 16.7 percent from 17.5 percent in December 2012.
Dr. Wampah also noted that the average lending rates of the banks declined marginally to 25.6 percent in October 2013, from 25.7 percent in December 2012.
“The average rate on 3-month term deposits remained unchanged at 12.5 percent, narrowing the spread marginally to 13.1 percent in October 2013, compared with a spread of 13.2 percent in December 2012,” he revealed.
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