The regime where over 60% of total banking assets accrue to foreign-owned banks is concerning - BoG Governor
The current regime, where over 60 per cent of the total bank assets accrue to foreign-owned banks, from a strategic point of view, may not be very optimal.
Bank of Ghana Governor Dr Johnson Pandit Asiama has expressed concern over the current banking landscape in Ghana, where over 60 percent of total banking assets are controlled by foreign-owned banks. During the 132nd Monetary Policy Committee (MPC) press conference, Asiama stated that this distribution may not be optimal from a strategic perspective and that the Bank of Ghana (BoG) and the broader banking sector are aiming to increase local banks' participation in the sector.
He attributed the failures of local banks during the recapitalization exercise to issues related to risk management frameworks and emphasized that the central bank is currently focusing on improving these frameworks. The Banking Supervision Division of the BoG had already issued several directives to local banks concerning risk management.
Asiama acknowledged the need for local banks to thrive and compete in the market. The current system may not be beneficial from a strategic standpoint and the BoG and the banking sector are working towards increasing the involvement of local banks in the sector.
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