The Bank of Ghana (BoG) has indicated that the whole asset base of industrial banks in Ghana continues to stay sturdy in spite of the economic challenges posed by using the outbreak of the novel coronavirus (Covid-19).
Addressing the ninety fifth Monetary Policy Committee (MPC) Press Conference, Governor of BoG, Dr. Ernest Addison, said whole bank asset base multiplied by 23.2 per cent in year-on-year terms to GH¢139 billion at end-June 2020.He stated that the statistics confirmed recoveries from loans, a giant amplify in deposits growth, and borrowing from parent company had funded banks investments, whilst these factors, in addition to regulatory reliefs, furnished formerly in the year by using the BoG had supported lending to the rest of the economy.
According to him, there have been symptoms of a gradual rebound in savings growth in response to the previously introduced policy measures aimed at helping savings extension and mortgage restructuring in response to the pandemic’s have an effect on local businesses.He revealed that outcomes of the cutting-edge stress checks carried out in the financial institution in July 2020 were reassuring and indicated that banks were well-positioned to face up to reasonable liquidity and savings shocks due to the existence of sturdy capital buffers.
In a regular situation of a credit score default main to the emergence of higher NPLs, the stress test outcomes confirmed that the essential provisioning may want to be simply absorbed, he said.“Banking sector statistics as at June 2020 continue to show robust overall performance in spite of the rising dangers posed via the pandemic on the sector’s operations,” Dr. Addison explained.“Weaknesses in key economic performance indications determined in the first quarter of 2020 regarded to have increased incredibly in the 2nd quarter in response to the various coverage measures introduced by using the BoG in March and May 2020.
Although the monetary soundness symptoms stay strong, the industry’s profitability overall performance has been adversely impacted with the aid of greater operational expenses due to measures being put in vicinity to restriction the affect of the pandemic on banks’ operations,” he added.“These measures are to ensure commercial enterprise continuity and higher loan- loss provisions due to repayment challenges with the aid of customers who have been severely affected via Covid-19. Sectors in the main affected by means of the pandemic and hence mortgage repayments to the banks and SDIs encompass the services, commerce