Growth in investments reduce to 7.2% in February 2020 according to Bank of Ghana

The Bank of Ghana (BoG) has released its ‘Banking sector report for March 2020’.

Bank of Ghana Governor, Ernest Addison

In the report, the BoG indicated that the growth in investments which consist of bills, securities, and equity reduced to 7.2% in February 2020.

However, in February 2019, growth in investment was at 33.3 percent.

The BoG said this could be partly blamed on a reflection of the base effects of the special (long-term) resolution bonds issued to Consolidated Bank Ghana (CBG), which increased the investment balance in February 2019.

Meanwhile, the total assets of Ghana’s banking sector is GHC128.33 billion in February 2020. This reflects year-on-year growth of 17.8% compared to 14.5% recorded in February 2019.

This showed that the banks recorded a better and stronger annual growth in total assets in February 2020 compared with a year earlier.

The BoG said the growth was on the back of a rebound in credit growth. Gross loans and advances increased by 26.0% to GHC45.91 billion in February 2020, after a slow growth of 1.9% a year earlier.

“Similarly, net loans and advances (that is, after adjusting gross loans for provisions and interest in suspense), grew by 27.2 percent to GH¢40.47 billion against a marginal pick-up of 4.8 percent in February 2019.”

“The rebound in credit growth underscores the positive impact of higher capital levels and sustained deposit growth in supporting intermediation. The cedi equivalent of foreign currency loans (net) went up slightly by 6.0 percent, indicating a decline in foreign currency loans in real terms during the period under review,” the BoG report added.

It added that Investments remain the largest component of banks’ assets but its contribution to growth in assets has declined.

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