Ghana banks’ assets rise to GH¢23.2b in April 2012 – BoG
Page last updated at Monday, June 18, 2012 9:09 AM //
The Bank of Ghana (BoG) believes that the banking sector is still robust explaining that the financial soundness indicators of the sector remain strong. “The Capital Adequacy Ratio (CAR) was well above the 10% threshold but declined to 16.8% at the end of April 2012, compared to 18.1% in April 2011,” it said.
The Bank indicated that the growth in assets of the banking sector was funded mainly by deposits (which went up by 29.1% to GH¢16.9 billion) and net worth which recorded a 20.8% growth to GH¢3.1 billion. It adds, of the total net worth, GH¢206 million was from bank recapitalization.
The asset quality of the banking system improved, according to the MPC as the Non-Performing Loan (NPL) ratio declined to 14.1% in April 2012, from 17.4% in April 2011.
Earnings performance also improved, it said.
Credit conditions survey conducted by the central bank in May 2012 showed a “tightening of credit stance” for both enterprises and households. The BoG attributed the credit stance tightening to increase in “cost of funds, strict collateral requirements and inflation expectations”.
However, total private sector credit expanded by 37.4% on an annual basis to GH¢9.3 billion in April 2012, compared to a growth of 17.3% in the same period of 2011. In real terms, private sector credit growth was 25.9%.
For broad money supply (M2+), its growth slowed to 30.1% in April 2012 compared to 41.5% a year ago, the MPC report highlighted.
The source of change in M2+ was a 51.5 per cent growth in the Net Domestic Assets (NDA) of the banking system, it added.
By Ekow Quandzie