Banks Archives - Page 2 of 3

24 May

BoG Received 983 Complaints From Customers Of Banks, Others In 2022; 36% Complaints Unresolved

wontumionlineBusinessBanks, BNoG, Complaints, NBFIs, SDIs

The Bank of Ghana received a total of 983 complaints from customers of banks, Specialised Deposit-Taking Institutions, Non-bank financial institutions and Payment Service Providers in 2022, a 15% increase over that of 2021. The rise was largely attributed to the increase in awareness of the general public and the confidence reposed in the Bank of Ghana to use its supervisory authority to adjudicate and resolve complaints. Out of the 983 complaints received in 2022, 626 complaints (64%) were resolved and 357 complaints (36%) remained unresolved. This is compared to 2021, where 857 complaints were received with 556 complaints (65%) resolved,…

24 May

Investments, Loans Among Top 5 Products Of Banks With Complaints In 2022 – BoG

wontumionlineBusinessBanks, BoG, Investments, loans

The top five products or services that received most complaints in 2022 were investments, loans, current accounts, digital and electronic-money. For investments, the complaint data suggested that investment products and services witnessed delays with discounting, statement issuance, crediting matured investment or interest and roll overs on maturity. About loans, concerns that were raised on loan products/services were generally around changes in loan tenure and interest rate without borrowers’ consent, delays in processing loans, releasing collateral, issuing loan statements, recovery approaches and termination of loans. According to the Bank of Ghana Report on Complaint Management, investment products and services, comprising both…

11 May

Banking Industry To Face Crisis If Government Fails To Secure $1.5Bn Stability Fund By July – US-Based Economist

wontumionlineBusinessBanks, Dr. Sa-ad Iddrisu, Stability Fund

Economist at Louisiana Economic Development in the USA, Dr. Sa-ad Iddrisu, has revealed a looming banking crisis in Ghana if the government is unable to get the $1.5 billion dollar Stability Fund by July 2023. According to him, if government is not able to get the funds by July this year, some banks will start collapsing since they won’t be able to pay their workers and keep their operations running. He argues, already, some banks have recorded huge losses, therefore the lack of liquidity support from the Stability Fund will leave them with the option to fold up or reduce…

02 May

Economic Challenges: 15 Out Of 21 Banks Recorded Losses In 2021

wontumionlineBusiness2022 Summary Financial Statements, Banks, DDEP

15 out of 21 banks that have released their 2022 Audited Financial Statement registered losses last year. This record losses is as a result of a difficult economic environment that triggered the Domestic Debt Exchange Programme or debt restructuring, impacting negatively on the operations of the financial institutions. According to their 2022 Summary Financial Statements, most of the banks’ assets were impaired due to reduced coupon rate and the extension of the maturity period from five to 15 years, among others. Consolidated Bank was the biggest casualty, recording about ¢2 billion loss in 2022. Indeed, the local banks were the…

26 Apr

Blame Yourselves For Huge Losses In Government Securities – UGBS Senior Lecturer

wontumionlineBusinessBanks, DDEP, Dr. Benjamin Amoah

Banks must blame themselves for the huge losses recorded in their books because of heavy concentration of their portfolios in Government of Ghana securities. According to a Senior Finance Lecturer at the University of Ghana Business School, Dr. Benjamin Amoah, the banks must pay the price for failing to undertake financial intermediation. Majority of the banks in Ghana recorded losses last year, according to their 2022 Audited Financial Statement. This is as a result of the impact of the Domestic Debt Exchange Programme on their operations. Speaking to Joy Business, Dr. Amoah said banks must admit they have not done…

18 Apr

DDEP: Banks Have Up To 2025 To Restore Minimum Paid-Up Capital; Industry Records Huge Loss In 2023

wontumionlineBusinessBanks, BoG, Capital Adequacy Raio, DDEP

Banks have a maximum of four years, ending 2025, to restore the minimum paid-up capital. This is as a result of capital shortfall arising solely from the derecognition losses. According to the Bank of Ghana, derecognition losses emanating from the Domestic Debt Exchange Programme will be spread equally over a period of four years, effective 2022, for the purposes of Capital Adequacy Ratio (CAR) computation. The International Financial Reporting Standards (IFRS) states that derecognition refers to the removal of an asset or liability (or a portion thereof) from an entity’s balance sheet. Due to the impact of the DDEP on the…

31 Mar

DDEP: Banks Loans To Businesses, Households To Fall Significantly – Fitch Solutions

wontumionlineBusinessBanks, DDEP, Fitch solutions, loans

Fitch Solutions has indicated that the banking sector loans will fall considerably in 2023, whilst deposit growth will decline marginally. It said Ghana’s client loan growth will ease from 30.2% year-on-year in 2022 to 18.0% in 2023. This is a result of the challenging macroeconomic backdrop, as banks remain uncertain about the possible fallout from the domestic debt restructuring, as well as base effects from very strong loan growth in 2022. “Whilst our nominal client loans growth forecast will still be in double digits in 2023, skewed by still elevated inflation, our real client loan growth forecast will be much…

16 Mar

Banks In Ghana Plan For $427 Million Of Losses Amid Debt Restructuring

wontumionlineBusinessBanks

Ghana’s move to restructure its local currency and overseas debt is weighing on banks from Africa to the UK. Four of Africa’s biggest lenders — Standard Bank Group Ltd., FirstRand Ltd., Absa Group Ltd., and Nedbank Group Ltd. — collectively set aside 4.87 billion rand ($267 million) to account for the losses, impairing as much as 57% of local and onshore dollar-denominated debt holdings. Meanwhile, Standard Chartered Plc set aside $160 million. A rare move to restructure local debt — bondholders exchanged 87.8 billion cedis ($7.1 billion) of notes that paid an average of 19%, with bonds returning as little…

14 Mar

Local Banks At Risk Of Insolvency Under IFRS 9 – Study

wontumionlineBusinessBanks, Dr Richmond Atuahene

Banking Consultant Dr. Richmond Atuahene has warned that banks operating in the country could face insolvency if the International Financial Reporting Standard (IFRS) 9 is applied strictly, following their participation in the Domestic Debt Exchange Programme (DDEP). Already, there are indications that foreign-owned banks, including South Africa-based Standard Bank and First Rand Bank, are looking to recapitalising their Ghanaian arms, with the former being reported to have set aside 1.5 billion South African Rand (ZAR) – approximately US$81million – to cover potential losses emanating from the DDEP. According to his analysis, contained in a paper titled ‘Assessing the Domestic Debt…

02 Mar

Domestic Debt Exchange: BoG Reiterates Position Of Closely Monitoring Banks To Prevent Insolvency

wontumionlineBusinessBanks, BoG, Domestic Debt Exchange, Ghana Association of Restructuring and Insolvency Advisors

The Bank of Ghana (BoG) has reiterated that it is closely monitoring some developments among banks due to the Domestic Debt Exchange which is increasing liquidity pressures. This is to help reduce any pressure on their balance sheet and consequently avert the probability of insolvency. Speaking on behalf of the Governor at the Induction Ceremony of the Ghana Association of Restructuring and Insolvency Advisors, Head of Resolution Office, Elliot Amoako, said macro prudential risk assessment of the banking sector indicates an emergence of spill over from the current economic challenges on the banking industry. He, however, appealed to the insolvency…