Analysis of financial statements of six banks that have been made public so farâ€” out of the total of 23 banksâ€”showed strong performance in all the key indicators, signalling the robustness and resilience of an industry that has undergone extensive â€œcleansingâ€.
The banks, CAL Bank, Zenith Bank, GT Bank, Standard Chartered Bank, Republic Bank and Societe Generale, posted healthy operating income and net profit growth while expanding their deposit and asset bases.
Aggregate profit after tax of the six banks jumped 36.1 percent from GHÂ¢809.5 million to GHÂ¢1.1 billion, after operating income experienced a 21.2 percent increase from GHÂ¢2.8 billion to GHÂ¢3.4 billion. Operating income growth was driven by net interest income, which improved by 25.2 percent to GHÂ¢2.4 billion.
The banksâ€™ loan books grew by 28.9 percent, rising from GHÂ¢7.7 billion to GHÂ¢10.0 billion. CAL Bank had the largest stock of outstanding loans of GHÂ¢2.9 billion, after achieving loan growth of 20.3 percent. Societe Generale, which increased its loans by 58.7 percent, had the second-largest loan book of GHÂ¢2.6 billion.
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Stanchart, CAL Bank and Zenith Bank commanded the biggest asset sizes, recording GHÂ¢7.6 billion, GHÂ¢7 billion and GHÂ¢6.7 billion respectively, which reflected growth rates of 27.8 percent, 30.2 percent, and 20.1 percent.
The six banks mobilised GHÂ¢21.4 billion in deposits, reflecting a growth rate of 27.7 percent from GHÂ¢16.8 billion in 2018.
The impressive performance, which likely represents an industry-wide trend, shows that the clean-up of the banking sector by the central bank did not hurt the industryâ€™s performance as some had feared.
Rather, analysts will view the results as attesting to claims by policymakers and financial experts that the clean-up of the banking sector has placed banks in a more liquid and robust position to drive economic growth.
President Nana Addo Dankwa Akufo-Addo, in his State of the Nation address on February 20, said although the financial sector intervention has caused some loss to the public purse, it has resulted in a sound and liquid banking sector to drive national economic aspirations.
â€œThanks to the banking sector clean-up, today I am happy to say that Ghanaâ€™s weak banking sector that we inherited is now well-capitalised, better managed, sound and liquid, and the banks are now increasing their lending to the private sector to help propel the transformation of the economy beyond aid,â€ he had noted.
According to figures from the Bank of Ghana, total assets of the banking sector grew by 22.8 percent to GHÂ¢129.1 billion in 2019, compared with a growth rate of 12.3 percent to GHÂ¢105.1 billion in 2018.
Banksâ€™ deposits also saw an annualised growth of 22.2 percent to GHÂ¢83.5 billion in 2019, compared with an annualised growth of 17.3 percent to GHÂ¢68.3 billion in 2018.
Private sector credit meanwhile has recovered, growing by 18.3 percent to GHÂ¢44.5 billion, up from the previous growth rate of 10.6 percent to GHÂ¢37.6 billion.
Credit : Business24