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Business News of Saturday, 24 August 2019

Source: citinewsroom.com

Banks’ profits shoot up in first half of 2019 — BoG report

The profitability of banks in the country has increased following the banking sector reforms, the Bank of Ghana’s latest Banking Sector Report has revealed.

According to the report which captures the performance of banks for the first half of 2019, the profitability indicators of the banking sector improved during the first half of 2019 compared with the same period last year.

The industry recorded profit after tax of GH¢1.67 billion, representing year-on-year growth of 36.3 percent compared with 21.7 percent in the same period last year.

This development the BoG explained was underpinned by higher growth of net interest income which grew by 20.7 percent reflecting both higher interest income from investments and lower interest expenses from reduced borrowings.

Also, income from net fees and commissions grew by 3.7 percent, significantly below the 24.7 percent growth for the same period last year, attributable to the slowdown in the volume of off-balance sheet activities.

The report also revealed that banks’ overall operational expenses grew by 7.6 percent, which was higher than the prior year’s growth of 5.3 percent resulting from the sharp increase in staff cost to 30.8 percent growth from 5.6 percent contraction the year before.

Notwithstanding, other operating expenses declined by 11.4 percent in June 2019 from a growth of 16.3 percent a year ago, somewhat moderating the growth in operating expenses.