Our banks are resilient; Speakers at Graphic Business/Stanbic Bank Breakfast forum assure public

Speakers at the Graphic Business/Stanbic Bank Breakfast Meeting have given the strongest indication yet that the country’s banks are safe and strong, despite the pockets of challenges confronting the banking industry.

The Second Deputy Governor of the Bank of Ghana (BoG), Ms Elsie Awadzi; the Senior Country Partner of PwC, Mr Vish Ashiagbor, and the Head of Corporate and Investment Banking at Stanbic Bank Ghana, Mr Kwamina Asomaning, who spoke at the meeting, said the banking sector as a whole was still resilient and strong enough to support the financial needs of the country.

The breakfast meeting

The breakfast meeting brought together players, stakeholders and policy makers in the banking sector.

The meeting was on the theme: ‘Liquidity and insolvency management — Boosting the health of banking in Ghana”.

Given the ongoing measures by the BoG, Mr Ashiagbor said he even expected to see a stronger banking sector by December 2018.

He said the strength of the sector that would emerge by December 2018 would be as a result of the exit of some of the weaker participants or the further strengthening of the strong participants.

Sector is healthy

Mr Asomaning, for his part, said the industry was still very healthy.

“The banks have just published their financial statements for 2017 and if you look at them, you can tell that most of the banks have recovered from the shocks and challenges that they faced,” he said.

He underscored the need to acknowledge the efforts of shareholders to ensure that their banks reached the minimum capital requirement by December 2018.

“Most of them have suspended their dividends, with quite a number of them even injecting fresh capital into their various banks. This is positive for the industry and needs to be acknowledged,” Mr Asomaning stated.

No cause for concern

Ms Awadzi too indicated that the sector was broadly doing well and still remained robust.

She said there was no cause for concern, as the BoG was monitoring the banks and making sure they stayed on track.

“There are still some challenges and we are monitoring them closely to make sure they are on track, but so far we have no cause to be concerned. We will continue to supervise them effectively to ensure that they become stronger and better,” she said.

“We license banks, give them conditions on which they should operate and give them rules to operate with. They take customers’ deposits and at one point in time they may catch a ‘cold’ and run into difficulties, but we have a duty that allows us to take different actions at different times to ensure that the banks recover from the ailment,” Ms Awadzi added.

She attributed the problems in the banking sector to poor corporate governance, poor risk management practices and sometimes the difficult macro-economic environment in which the banks operated.

Strong regulations

Touching on how the affected banks would bounce back, she said it was only strong supervision and regulations that would help them recover.

She said the BoG had come up with a lot of measures and would continue to introduce more measures, going forward, to sanitise the banking sector.