Banks Are Liquid- BoG
The Governor of Ghana’s Central Bank, Dr Ernest Addison, has stated that banks in the country have adequate funds to operate.
He was speaking at a press conference on May 18, 2023, virtually.
According to him, the BoG does not foresee banks struggling with liquidity as a result of the Domestic Debt Exchange Programme (DDEP).
“Banks are very liquid. We don’t see that the Banks are having any difficulty with liquidity and in any case the Bank of Ghana stands ready to provide liquidity to any bank that may have future liquidity issues.”
He explained that the main impact of the debt exchange was to reduce the capital buffers of the banks which has been solved through the institution of regulatory forbearance.
“We’ve reduced the capital conservation buffer by 3% – we’ve reduced the capital adequacy ratio from 13 to 10%and we’ve given them a period of three years to rebuild their buffers. So we think the banks will be fine and shareholders will systematically rebuild the buffers and the government as a shareholder will find resources to rebuild the capital buffers of the state-owned banks.”
In April, Bloomberg reported that Ghana’s move to restructure its local currency and overseas debt has resulted in the first loss on record for two of the West African nation’s top banks.
It said GCB Bank Plc, the country’s largest lender by assets, posted a 593.4 million cedis ($50.5 million) net loss for the year to end December, its first since 1993 when Bloomberg started maintaining data.
Meanwhile, it said, Standard Chartered Bank Ghana Ltd., the biggest by market value, reported a loss of 297.8 million cedis.
It also reported that GCB Bank took a charge of 1.83 billion cedis after impairing its debt securities, while for Standard Chartered Bank Ghana the amount was 173 million cedis.
