The President of the Ghana Association of Banks has expressed optimism about the country’s banking sector, stating that Ghana is on a “path to recovery” following a series of economic shocks in recent years.
Kwamina Asomaning speaking on Joy News’ PM Express Business Edition on Thursday, March 20, acknowledged the challenges the sector has faced but emphasized the strides made towards stability.
“I have been in the banking sector for some years, and the only constant is change. Each period has come with its fair share of challenges,” he noted.
“I wouldn’t say one period has been more turbulent than others by a significant degree, but we’ve gone through a few shocks.”
Reflecting on recent economic upheavals, the Managing Director of Stanbic Bank Ghana, pointed to the COVID-19 pandemic and the subsequent sovereign debt default as key disruptions that rattled Ghana’s financial landscape.
However, he stressed that despite the setbacks, the situation has improved compared to the past two years.
“I think it’s fair to say that we are on a path to recovery. We’re not completely out of the woods, but if you look back to where we were in 2022 and 2023, there has been significant improvement on the broad macros and in the sector in particular,” he explained.
The banking sector faced immense pressure following Ghana’s debt restructuring efforts, which significantly impacted financial institutions holding government bonds.
The sector also grappled with liquidity challenges and weakened investor confidence. However, Mr Asomaning believes the worst is behind the industry, with positive trends emerging.
Industry players have been working closely with regulators to restore stability, and Asomaning commended efforts made by the Bank of Ghana in fostering resilience.
“The regulator has been very instrumental in ensuring that the right policies and measures are put in place to restore confidence in the sector,” he said.
His remarks come at a time when banks are gradually regaining momentum, with improved macroeconomic indicators signaling cautious optimism.
Inflation rates, currency stability, and economic growth projections have shown some progress, factors that Asomaning believes are critical in solidifying the recovery process.
While acknowledging the road ahead remains uncertain, Asomaning underscored the need for continuous adaptation and collaboration to sustain the gains made.
“As banks, we must remain agile and innovative. The challenges we have faced only reinforce the importance of resilience and adaptability,” he stated.
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