Governor of the Bank of Ghana, Dr Ernest Addison has said that the banking sector indicators point to a recovery from the impact of the domestic debt exchange programme.
He said total assets increased by 28.8 percent to GH¢306.8 billion at the end of April 2024 driven by domestic currency deposits and other funding sources.
Banks also reported higher profits for the first four months of 2024, relative to the same comparative period in 2023, Dr Addison said during the 118th Moneray Policy Committee (MPC) press conference in Accra on Monday May 27.
Dr Addison further stated that key financial soundness indicators generally improved during the review period (First four months of 2024).
The capital adequacy ratio adjusted for reliefs increased to 15.5 percent in April 2024 from 14.7 percent in April 2023, reflecting the rebound in profits. Capital adequacy ratio without relief for the banking system was 11.5 percent at the end of April 2024 compared to 7.6 percent in April 2023.
Liquidity and efficiency indicators also improved in April 2024, compared to the same period last year.
The non-performing loan ratio, on the other hand, increased to 25.7 percent in April 2024 from 18.0 percent in April 2023, due to the lagged effect of COVID-19 pandemic and the economic crisis of 2022 which has led to the downgrading of several large exposures of banks. The sector is expected to be strengthened as banks recapitalise and enforce stringent credit underwriting standards.
“On the international commodities market, prices of Ghana’s major exports (cocoa, gold,
and crude oil), recorded gains in April 2024. Cocoa prices continued to increase, reaching
US$10,116.9 per tonne in April 2024, from US$4,235.60 per tonnes in December 2023,
representing a year-to-date gain of 138.9 percent.
“Crude oil prices increased by 15.2 percent on a year-to-date basis to US$89.00 per barrel in April, compared to US$77.26 per barrel in December 2023. Gold prices also increased by 14.7 percent at the beginning of the year to US$2,334.2 per fine ounce,” he said.
He added “The balance of trade recorded a lower surplus of US$744.3 million for the first four months of the year, compared to a surplus of US$1.39 billion in the corresponding period of last year. Total exports increased by 4.9 percent to US$5.83 billion driven mainly by significant growth in gold exports and a modest increase in crude oil exports. Earnings from gold exports increased by 37 percent to US$2.97 billion, due to higher volumes of exports from small-scale gold production.
“The value of crude oil exports, in comparison, increased by 9.4 percent to US$1.27 billion, on the back of both volume and price increases. Exports of cocoa, both beans and products, dropped by 49.0 percent to US$599.3 million. Other exports, including non-traditional exports, also decreased by 6.0 percent to US$981.8 million.
“Total imports increased by 22.2 percent to US$5.08 billion, driven mainly by non-oil imports which went up by 31.2 percent to US$3.53 billion, while oil imports increased by 5.6 percent to US$1.55 billion.”
