The Head of Banking Supervision of the Bank of Ghana, Mr. Osei Gyasi has urged banks to meaningfully support growth of the oil sector to create jobs and reduce unemployment in the country.
At a roundtable with some members of the banking industry organized by Integrity Magazine under the theme: “Ensuring Macroeconomic Stability through Effective and Trusted Banking” on Tuesday in Accra, Mr. Gyasi noted that Banks will be able to support the oil sector and create job opportunities if they have long term adequate capital.
Mr. Gyasi said there has been an increase in foreign content in the oil sector because Ghanaian banks did not have the needed capital to go into oil businesses, adding that “What we have observed is that the local content as far as the oil sector is concerned is that some of the Ghanaian companies do not have the financial resources to go into those areas and that also impact on repatriation of profit.
if the banks are able to effectively support the oil sector, and reduce the foreign content in that sector, the sector would be able to employ more people and reduce the rate of unemployment.”
The programme was to open avenue for discussions and understanding of the banking reforms and how it would translate into a stronger macro economy.
The Chief Executive Officer of Chartered Institute of Bankers, Ghana, Mr. Charles Ofori-Acquah also added that, high non-performing loans, poor corporate governance structures, capital inadequacies, non-compliance by banks and illiquidity were some of the factors that were affecting the banking sector.
According to Mr. Ofori-Acquah, strong banking sector was the backbone for stable economy in any country, adding that the banks needed macroeconomic stability to grow.
“Macroeconomic stability is therefore precondition for banking industry to flourish. Some of the key economic indicators of macroeconomic stability include low and stable inflation rate, low long-term interest rate, low fiscal deficit and currency stability. These economic variables impact on banks in many ways,” he said.
Mr. Ofori-Acquah, however, said there had been improvement in the banking industry, creating a platform for banks to positively impact on the economy, adding that “banks are now in better position to contribute to economic growth.”
Rev Kennedy Okosun, Editor-In-Chief of Integrity Magazine, said the programme was organized as part of their Corporate Social Responsibility to offer opportunity for Banks to come together and ensure that they were effective and trusted.
He said Integrity Magazine targeted decision and policy makers in government and the private sector to improve their corporate governance and profitability, and readers with strategic interest in Ghana.
