Business News of 2014-07-17

Cedi depreciation an opportunity — BoG

The Governor of the Bank of Ghana (BoG), Dr Henry Kofi Wampah, has asked banks in the country to take advantage of the depreciating cedi against the major foreign trading currencies to devise products and services that will help boost the country’s exports.

“The current depreciation of the cedi, while inimical to import-driven businesses on the flip side, supports export-oriented companies and this, in my opinion, lends itself to profitable funding opportunities for banks to foster economic growth,” he said.

The Governor gave the advice in a speech read on his behalf by the Second Deputy Governor of the bank, Dr Abdul-Nashiru Issahaku, at the 14th annual working luncheon of the Ghana Association of Bankers (GAB) in Accra yesterday.

“The SME sector represents another important area for profitability and growth and I expect the banks to revise and develop new banking solutions and models to serve this market segment to engender financial inclusion among less-privileged communities,” Dr Wampah said.

He said against those opportunities and the growing challenges in the macro-economy, the BoG had initiated a number of key steps, in line with its forward-looking view of the industry.

Earlier, the President of the GAB, Mr Simon Dornoo, had expressed the commitment of members of the association to offer continued support to enhance the growth of small and medium enterprises (SMEs) in the country.

According to him, the loan books of members of the association clearly demonstrated the level of support from banks to the SME sector and expected that more was done in a calculated manner to ensure a win-win situation.

The assurance from the association emanated from questions to the effect that the banks were shying away from SMEs in the country for fear of running at a loss. Oftentimes, government officials and industry associations openly criticise the banks for not lending to SMEs because players in that sector are deemed to be too risky to lend to.

But, in sharp contrast, Mr Dornoo insisted that the loan books of the banks did not support the assertions of the critics. “We all do SME financing and we do it in different forms because every action depends on the strategy of each bank. But all I am saying is that we do lend a lot to grow SMEs in the country,” he said.

The Managing Director of CAL Bank, Mr Frank Adu Jnr, also stated that the loan books of banks clearly indicated that between 70 and 90 per cent of the loans of banks were offered to SMEs. “We do a lot for that sector and, therefore, it is not correct for anybody to say that we do not lend to SMEs,” he added.

Source: graphic.com
« Previous | Next »
View Comments
Sponsor Links
News Categories
Site Menu