GhanaNews

Ghana: Banks PBT Shoot Up 27 Percent to Ghs 4.9 Billion in August

0
Bank of ghana2
Share this article

The profit before tax (PBT) of the banking industry shot up by 27.4 per cent to ¢4.9 billion in the first eight months of this year, signaling a recovery in economic activity.

According to the Bank of Ghana, this is higher than the growth of 19.2 per cent registered a year ago.

Over the same comparative period, net interest income grew by 17.9 per cent to ¢8.3 billion, marginally lower than the 18.7 per cent growth a year ago.

Net fees and commissions grew strongly by 21.8 per cent to ¢1.85 billion, higher than the growth of 8.9 percent for same period last year. This reflected the continued recovery in trade finance-related and other ancillary businesses of banks.

Also, total operating income rose by 15.7 per cent, marginally below the corresponding growth rate of 17.0 per cent.

Cost control measures within the banking sector continued to support profit performance with operating costs increasing by 9.0 percent, lower than the 12.1 per cent increase for same period in 2020.

For loan loss provisions, it also increased by 5.3 per cent, compared with the 29.5 percent growth a year ago. Profit before tax accordingly increased by 27.4 per cent to ¢4.9 billion, higher than the growth of 19.2 per cent a year ago.

The Bank of Ghana described the banking sector as strong and well-capitalised, with stronger growth in total assets, investments and deposits.

This is represented in the financial statements of majority of the banks.

Total assets increased by 16.7 per cent to ¢166.4 billion as at the end of August 2021, driven mainly by a 28 per cent year-on-year growth in investments to ¢80.3 billion.

Also, growth in gross advances rose by 8.7 per cent as at August 2021 from the end-June position of 5.7 per cent .

Furthermore, the Bank of Ghana said strong liquidity flows during the period resulted in a 21.8 per cent annual growth in total deposits to ¢111.6 billion.

On the Financial Soundness Indicators, the Central Bank said it had remained strong, whilst the industry’s Capital Adequacy Ratio of 20.7 per cent at the end of August this year, was way above the regulatory minimum threshold of 11.5 per cent.

The regulator also said that private sector credit growth has not fully recovered to pre-pandemic (Covid-19) levels due to lingering supply-side risk aversion from the shock of the pandemic as well as slower-than-expected growth in demand for loans that are backed by bankable projects.

The annual nominal growth in private sector credit therefore slowed to 9.5 per cent in August 2021 compared with 14.3 per cent, in the corresponding period of 2020.

Similarly, real private sector credit contracted marginally by 0.1 per cent compared to a growth of 3.4 per cent, recorded over the same comparative period.

Share this article

NEW ZEALAND EXPLORING THE POSSIBILITY OF ISSUING A DIGITAL CURRENCY

Previous article

PayPal, Visa, and Amazon to help the Bank of England work on its CBDC

Next article

You may also like

Comments

Comments are closed.

More in Ghana