The Non performing Loans of universal Bank in the country are expected to drop considerably after the recapitalization exercise which has reduced the commercial banks to 23 banks out of 33 banks.
Looking ahead, there will be a need to focus on reducing the high NPLs in the sector and addressing the risks associated with the high degree of interconnectedness in the financial system which will require close monitoring to ensure financial stability,” the governor of Bank of Ghana, Dr Ernest Addison has said.
The 23 banks are sound, liquid and well-capitalized, and well-positioned to translate the gains made so far from two years of far-reaching reforms to the rest of the economy.
The exercise, according to BoG, has protected deposits of over 1.5 million depositors with deposits of GH¢11.6 billion. This includes deposits of savings and loans companies, rural and community banks, investment fund managers, pension funds, and life insurance companies with the banks.
“The increase in the stated capital which formed part of the banking sector cleanup is an indication of challenging times for banks. The Managing Director of Societe Generale (SG) Ghana, Hakim Ouzzani has cautioned his colleagues in the banking sector not to go to sleep after successfully meeting the Bank of Ghana’s minimum capital requirement.
At the end of December 2018, total assets of the banking sector grew by 14.7 percent year-on-year to GH¢107.3 billion.
“Growth in industry assets is expected to rebound as banks deploy their newly-injected capital towards financial intermediation,” BoG said in a statement.