The Ghana Association of Banks (GAB) Governing Council has engaged the newly appointed Governor of the Bank of Ghana (BoG) in a high-level assembly to handle important challenges going through the nation’s banking sector.
The assembly, which was marked by congratulatory remarks and requires stronger collaboration, coated key subjects corresponding to money reserve ratio (CRR) reforms, correspondent banking relationships, fintech regulation, and FX liquidity.
One of the first considerations raised was the present Cash Reserve Ratio (CRR), which banks argued was proscribing monetary intermediation and rising operational prices.
The BoG Governor acknowledged the impression of the CRR and warranted banks {that a} assessment was into consideration. However, he emphasised that any changes could be phased to stop financial instability. He welcomed trade enter on mitigating dangers related to liquidity releases, highlighting that even the International Monetary Fund (IMF) supported a assessment of the coverage.
GAB members additionally expressed considerations about Ghana’s credit standing challenges, which have affected correspondent banking relationships. Banks known as for an upward revision of Nostro and affiliate publicity limits to ease constraints on worldwide transactions. The Governor acknowledged these challenges and warranted stakeholders of his dedication to assessing and bettering the state of affairs.
With the rise of fintechs and Money Transfer Operators (MTOs) within the remittance market, banks raised considerations over regulatory gaps that might result in international change (FX) losses for Ghana.
The Governor indicated that the BoG is already reviewing MTO operations and urged banks to collaborate in streamlining the sector for better transparency and stability.
Another key difficulty was the expiration of the particular dispensation on restructured Cocoa Bonds beneath the Domestic Debt Exchange Programme (DDEP) in April 2025. Banks famous that COCOBOD’s monetary place and market illiquidity made it troublesome to promote down these bonds. The Governor responded positively, expressing his willingness to increase the dispensation to assist affected banks.
GAB members known as for an finish to the obligatory sale of FX proceeds from mining and oil firms to the BoG, arguing that permitting these funds to move by means of the banking system would enhance FX value discovery and deepen liquidity. The Governor acknowledged the significance of FX market effectivity and expressed openness to additional discussions on the matter.
The Governor sought suggestions on the effectiveness of the Ghana Incentive-Based Risk-Sharing System for Agricultural Lending (GIRSAL) in de-risking agricultural financing. Banks responded positively, supporting scaling up agricultural financing initiatives. The Governor reaffirmed his dedication to doubling agricultural lending and helping GIRSAL in elevating further assure funds. He urged GAB to steer stakeholder engagements to reinforce and de-risk agricultural worth chains.
Banks raised considerations about rising Non-Performing Loans (NPLs), emphasizing the necessity for fiscal coverage interventions to cut back inflation and rates of interest. The Governor acknowledged the function of sound financial and monetary insurance policies in stabilizing the banking sector and indicated that his administration would prioritize measures to handle NPL development.
The assembly additionally explored the potential of revising Ghana’s common banking license regime by introducing versatile capital necessities and a tiered banking system. The Governor talked about that the mixing of Islamic banking into the nation’s monetary system was into consideration as a part of broader banking reforms.
The Governor emphasised the significance of settling transactions with main African commerce companions in native currencies, moderately than defaulting to the US greenback, which places stress on the cedi. He highlighted Nigeria and South Africa as key companions for native forex settlements and inspired regional banks to facilitate intra-African commerce.
The assembly concluded with remarks from financial institution executives and the BoG Governor, reaffirming their dedication to ongoing collaboration to handle sectoral challenges. A gaggle {photograph} was taken to mark the event, symbolizing a renewed partnership between the BoG and the banking sector.
This engagement alerts a brand new period of cooperation geared toward guaranteeing Ghana’s banking sector stays resilient, aggressive, and well-regulated within the face of evolving financial challenges.
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