Gambia's banking industry registers strong growth
The number of banks increased from five in 2005 to twelve in 2015.The Gambian banking sector had experienced rapid growth over the past few years, the Governor of the Central Bank of The Gambia (CBG), Amadou Colley, has said.
He attributed this improvement to favorable financial policies, foreign direct investment inflows to the industry and intensified competition due to an increase in the number of banks in the country from five in 2005 to twelve in 2015.
"The industry is adequately capitalised and liquid," he said. The risk weighted capital adequacy ratio was 32.9 per cent in 2015, higher than the minimum requirement of 10 per cent.
However, he said that access to formal financial services remains "very low", with less than 20 per cent of the adult population holding a bank account.
"Credit to the private sector, which only represented 11 per cent of GDP in 2015, is insufficient to drive strong and sustained economic growth," he said.
He blamed this situation on the fact that interest costs, administrative expenses and collateral requirements for loans are significantly higher in The Gambia compared to most sub-Saharan African countries.
He pledged that the central bank will focus on improving access to finance and revealed the first Credit Reference Bureau (CRB) was recently established in the country, in collaboration with commercial banks. The bureau is expected to facilitate risk assessment for banks and boost lending.