Ghana: BoG to Help Banks Explore Ways to Meet New Capital Requirement

Jun 28, 2017 | Business Day Ghana; All Africa

The Bank of Ghana (BoG) must create a tier system that can cater for the needs of the country's banking sector. This would ensure that the gains of capitalization are fully harnessed.

This is contained in a set of recommendations made by the President of the Chartered Institute of Bankers, Ghana (CIB), Reverend Mrs. Patricia Sappor to the BoG. According to her, BoG must not announce a uniform capital requirement for the banking sector. Rather, the central bank needs to consider a tiered recapitalisation policy that addresses the needs of the various banks. This, she said, would help the banks to serve and specialise in other sectors of the economy, especially the small and medium enterprises (SMEs). The CIB president added that the central bank should give the banks ample time to explore ways of meeting the new capital requirements. "Recapitalization of banks could take place at any time, probably, every four to five years. The banks ought to take a long-term view of the economy and the banking industry and prepare for their capitalisation plans ahead of time." Rev. Mrs. Sappor advised banks to continue to strengthen their balance sheets over the next couple of years to enhance the pace of value creation in the interest of shareholders; so that shareholders would be ready to invest more in their respective banks. Read more on All Africa. Source: All Africa