ghananlpcommunity/ghana-gov-speeches-sentences huggingface dataset:
Chairman, a dynamic growth -oriented financial system must be strong, well capitalised, and effectively supervised within a fair regulatory environment in accordance with international best practices and standards.
There is therefore, a huge regulatory burden on us to remain vigilant towards all forms of risks in the banking sector and to tighten our regulatory and supervisory responsibilities to continue with efforts at st rengthening and stabiliz ing the banking industry.
These reforms will ensure the safety and soundness of banks, aligning macro and micro -prudential risks to bank capital and addressing cross - sectoral and cross -border risks to the industry.
In other to addr ess potential risks and to properly risk profile individual banks, we are taking steps to revise the current risk-based supervision framework in line with current developments in the global banking environment.
To further boost depositors’ confidence and lock-in the reform process, the Deposit Insurance Protection Corporation (DIPC) would become fully operational effective October 1, 2019.
The deposit insurance is one of the key pillars in securing financial sector stability.
As Amended, the Ghana Deposit Protection Act 2016 (Act 931) was enacted to protect small savings from los ses incurred as a result of the occurrences 7 of an insured event such as the revocation of a Deposit Taking Institution ’s license.
Among othe rs, the Act also supports the development of a safe, sound, stable and efficient market -based financial system.
In the process of operationalising the DIPC, the Bank has already sent letters to banks to begin a process of onboarding after agreeing on an an nual premium of 0.3 to 1.5 percent of insurable deposit s with participating institutions.
The Bank of Ghana, which is the Project Implementation Authority, will support the DIPC for 3 years to ensure sustainability.
The agreed payout in the event of bank f ailure and the revocation of licenses have been pegged at Gh¢6,250 per customer for banks and Gh¢1,250 per customer for Specialised Deposit-Taking Institutions.
Consolidating the Gains 11.
Going forward, we expect access to credit to be on a predictable and cost effective terms as part of the benefits of the reforms and this week we have met with every bank and discussed ways in which these results can be realised by the end of the year.
And such a successful outcome would depend on macroeconomic policies and reforms in the financial sector.
But it will also depend on the private sector’s own initiative, resourcefulness, and capacity to take advantage of opportunities that have been created by the reforms.
We are aware that the clean -up of the MFI has led to a sharp fall in deposit rates of MFI 8 in Ghana, as depositors would rather save with strong well managed institutions than chase yield.
This should have a knock on effect on all deposit rates in the financial sector.
The Receivership Process 12.
Ladies and Gentlemen, let me now turn to update you on the receivership process and the progress that has been made so far.
We remain confident that despite the initial hiccups associated with records the receivership process has progressed steadily.
The receivership process has progressed steadily in line with expectations and include the following: i. Validation of the financial position of the defunct banks; ii.
Realization of assets/recoveries; and iii.
To settle creditors and engage other stakeholders.
These activities were subsequently categorised under three phases of the receivership process, namely:  Phase 1 – preservation of assets and validation of the financial positions;  Phase 2 – Realization of the assets (including loan recoveries), administration of creditor claims and payment of interim dividends as appropriate; and 9  Phase 3 – Complete assets realizations, resolution of matters in litigation, payment of dividends as appropriate, complete administrative and statutory duties.
As we speak today, total loans taken over by the Receivers amounted to Gh¢10.1 billion, while total proceeds realized up to date are over Gh¢849 million.
These proceeds were realized through loan repayments by customers, placements re paid, proceeds from sale of vehicles, bonds, other income – interest from placements made and the refund of commissions paid.
As regulators, we are very grateful for the support received but urge the inves tigating bodies and the judiciary, the Government, Chief Justice and Security Agencies to work steadily to recover certain assets from shareholders, directors and loan defaulters of the erstwhile defunct banks.
Currently, there are fifty -two (52) cases in the various courts in the country, 50 of which have been assigned to specific judges/courts.
In addition, over sixty (60) cases have been referred to the Special Investigative Team.
The task is enormous but w e have confidence in our judicial system to bring those culpable to justice.
The Bank of Ghana will continue to work with the Receiver to ensure that bottlenecks in the receivership process cleared for the orderly winding down of the defunct banks.
10 Internal Reforms 15.
Unfortunately, our predecessors in line with the governance challenges in the country at the time allowed the central bank operations intertwined with the political economy th ereby committing considerable resources into non -core functions of the bank including building 5 -star guesthouses in Takoradi and Tamale as well as the Bank Hospital in Cantonments.
We have refocused the Bank around its core central bank responsibilities, that is monetary policy and exchange rate management, price stability, financial stability, banking sector regulations, and supervision.
A number of our staff are going through internal administrative process to establish culpability, if any, that contributed to the challenges resulting in the clean-up of the finan cial sector.
Once that process is completed, the public would be briefed of administrative actions that have been taken.
In fact, yesterday one staff was dismissed for gross misconduct and conflict of interest involving the award of the Sibton Switch Contract which was cancelled in August of 2017.
The signal has been sent clearly to staff about the need to ensure discipline and professionalism in line with the new Code of Conduct that was launched in May this year.
11 Capacity Building Efforts 16.
Chairman, we will continue with our regulatory reforms and efforts at strengthening the internal structures of the Bank of Ghana to prevent complicity of staff with third parties in the course of discharge of their supervisory duties.
The strengthening of our regulatory and supervisory capacity will happen through improved systems, processes, accountability and training, all in a bid to better identify violations , detect early warning signals, enforce the law, and ensure that banks take prompt corrective ac tions to address emerging risks.
Our crisis management framework is also being strengthened to help us contain, manage, and resolve crises more promptly.
We are bringing international best practices and standards to create a central bank that is fit for purpose.
Proud of Collaboration 17.
Ladies and Gentlemen, at the end of the clean-up exercise, I am confident to say that as a bank, we are proud of the reforms and achievements so far.
These have been possible as a result of support and collaboration with key stakeholders, that is the banks and SDIs, strong support from the government, and not the least the strong support from our international partners—the IMF, World Bank, and other development partners.
12 Conclusion 18.
Finally, Mr.
Chairman, the Bank of Ghana will continue to pursue policies and programs aimed at developing a vibrant financial system capable of harnessing financial resources for the growth and development of our country.
We appreciate the healthy working relationship existing between the Bank of Ghana and the Ghana Association of Bankers and we believe that this co -operation should continue and be deepened to enhance the performance of the banking sector.
DIGITAL BANKING SUMMIT 2019 KEYNOTE ADDRESS DR.
MAXWELL OPOKU -AFARI FIRST DEPUTY GOVERNOR BANK OF GHANA AUGUST 19, 2019 KEMPINSKI HOTEL, ACCRA 1 Captains of Banking Industry and Digital Technologies, Distinguished Guests, Ladies and Gentlemen, 1.
Good morning and it is a great pleasure to be here today at this Digital Banking Summit.
Before I continue, let me thank the International Centre for Strategic Alliances (ICSA) and KPMG for providing this unique platform to delibera te on pertinent issues on digitisation of banking services across the African continent.
The choice of Accra for this important event, with Master Card as the lead sponsor, underscores the growing importance of Ghana as one of the emerging digital financial service hubs on the African Continent.
Ladies and gentlemen, digital innovation is creating unprecedented opportunities for Africa to grow its economy, create jobs, and transform people’s lives.
New technologies and business models are opening alternative pathways to economic growth in emerging markets, offering opportunities to reshape our lives and improve economic growth.
The Government of Ghana’s commitment to formalize the Ghanaian economy through digitisation is laudable.
Digitisation is a key component of the “Ghana Beyond Aid Agenda” which is firmly anchored in leveraging technology to promote economic efficiency and i nclusiveness for accelerated development and poverty reduction.
Indeed, the President has shown keen interest and remains committed to building an inclusive modern society.
This drive has seen the roll-out of several digital initiatives such as, the digita l property addressing system, the National biometric ID cards which will be linked to Government agencies to help ease identification processes and promote integrity and efficiency in business transactions.
We are also witnesses to the tremendous impact of digitisation on the financial sector.
Ghana’s progress in migrating to electronic payments has been phenomenal.
In less than a decade, we have increased the number of 3 financially included persons from 41 percent in 2014 to 58 percent in 2017, and most of the jump emanated from mobile money patronage.
For instance, the volume of mobile money transactions jumped by more than 40 percent from 982 million to 1.4 billion transactions between 2017 and 2018.
With the advent of technology, conservative banking operations has given way to dynamism and competition as innovative financial services and product are constantly being churned out.
Currently, banks are not only competing among themselves for financial services but also with non - traditional providers such as financial technology companies (fintechs).
These developments raise important issues on banks’ business models that would appropriately deal with the increased levels of competition in the industry.
Faced with these challenges, banks are adopting collab orative strategies and leveraging on opportunities to partner new payment service providers or existing players in the delivery of financial services.
In the mobile money space, financial technology companies, banks and mobile money operators have collabo rated to introduce value added services such as digital credit, savings and investment, online payment platforms, Unstructured Supplementary Service Data (USSD) services, mobile banking services, Quick Response (QR) codes, Point of Sale (POS) devices, termination of inward remittances into mobile wallets or bank accounts, and agency banking services.
Fintechs have also partnered with insurance companies to deliver digital insurance products to the underserved.
Indeed, digitisation provides great potential for the banking sector to offer products and services that hitherto was not regarded as feasible.
However, the transition to a digital economy requires re -orientation of the sector to meet consumer demand.
Ladi es and gentlemen, it is against this background that the chosen theme of ‘Digitisation of the Banking Sector – En route to a Cashless Africa’ is 5 deemed appropriate and timely as the Continent seeks to harness the potential of digital technology to achieve the cash-lite agenda.
In the pursuit of this agenda, let me draw on Ghana’s experience and highlight some important elements of the country’s strategy towards financial inclusiveness and cash - lite transactions.
Over the past fifteen years, the Ghana Interbank Payment and Settlement Systems (GhIPSS), a subsidiary of the Bank of Ghana, in collaboration with other payment service providers have made enormous investments in the payments system infrastructure to provide the platform for digital payments.
Among others, the payments system infrastructure has also created an integrated and interoperable retail payments ecosystem which includes cheque codeline clearing with truncation, automated clearing house for direct debit and credit transactions, an instant r etail payment system, mobile 6 money interoperability and the recently launched hybrid card – which has consolidated the e -zwich and gh -link cards – to provide convenience to customers.
Chairman, for the payment system to operate efficiently, it must be subjected to strong legal and regulatory frameworks to provide certainty to all stakeholders.
In this regard, the Bank of Ghana initiated processes that led to the passage of the Payment Systems and Services Act 2019, (Act 987) to provide an enabling re gulatory regime for digital payments.
For all intents and purposes, the Act seeks to promote innovation in the design and delivery of payment products and services by widening the scope of the payments industry to Fintechs and engendering competition.
It is expected that Fintechs’ innovations will deliver products that meet the needs of all stakeholders, whether banked or unbanked and underserved, to attract them into the digital payment space.
7 Also, a proportionate regulatory regime has been adopted to promote fairness in regulation and accommodate different payment service providers.
The quest for cashless payments is gradually shifting consumer interfaces from the manual environment to cyber space.
Alongside this transition, there has also been an increased spate of complex cyber security threats which is posing risks to the cashless agenda.
The Bank of Ghana has therefore issued a cyber-security directive for compliance by banks and payment service providers to build a robust and resilient digital ecos ystem.
To further accelerate the digitisation process, stakeholders must work collectively to promote merchant acceptance of digitised financial products and services , with particular emphasis on lower - tier merchants, such as small and micro-enterprises.
The next key area is enhancing public confidence .
Despite the successes achieved so far, some consumers still 8 lack awareness and confidence in electronic payments.
In this direction, the various stakeholders are undertaking continued consumer education and financial literacy to build confidence and hel p in fraud reduction.
GhIPSS and stakeholders in the payment industry are also building a fund to support consumer education.
Also, on a regular basis, payment service providers are educating the public on how to avoid scams in the use of the newly deploye d payment products and services.
The Bank of Ghana is fully committed to the cash -lite agenda which ties in with the Government of Ghana’s digital economy agenda.
So far, we have seen the introduction of the biometric national identification system and th e digital addressing system which are all supportive of our quest to drive digitised financial transactions.
As the central bank, we will continue to work with all stakeholders to ensure the successful implementation of these initiatives.
Of course, 9 there will be challenges, but with firm commitment, we will eventually reduce the dominance of cash in transactions and improve the efficiency and security of payments for a more inclusive society.
To conclude, let me note that the future of banking services is digitisation and it brings opportunities as well as challenges.
We can harness digitisation to promote transactional efficiency in the delivery of financial services as well as scale up and broaden financial access to all segments of the society.
Togethe r, we must leverage on these opportunities to deliver financial inclusion across our various countries and the continent at large.
I believe that these issues will form the basis for the panel discussions and focus sessions at this two -day Summit.
I wish y ou a fruitful deliberation.
<p>Recent developments suggest that mobile money technology has evolved and gained public acceptance, and in almost a decade, contributed significantly towards financial inclusion in the country.
For instance, the number of mobile money accounts has reached 32.6 million in December 2018 compared with 3.8 million in December 2012.
Total float balances as at December 2012 was GH₵19.6 million compared with GH₵2.6 billion recorded in December 2018.<br></p>
<p>Ghana’s Savings and Loans sub-sector is made up of some 39 companies as at the end of March 2019, and dominates the Specialised Deposit-Taking Institutions (SDI) sector, accounting for 44.6 percent of total SDI assets.
In March 2019, total assets of the sector increased to GH¢7,977.63 million, up from GH¢6,548.63 million a year earlier.<br></p>
<p>Leveraging on mobile phone technology, Ghana made significant progress in improving financial inclusion.
With the fastest growing market in Africa with an estimated voice subscriptions rising by 60.0 percent (25.6 million) to (40.9 million) between 2012 and 2018, mobile money accounts have also increased over nine – fold reaching 32.6 million from about 345,000 over the same period.
At the end of 2018, active mobile money accounts were estimated at 13.1 million accounts.<br></p>
<p>Cyber criminals have managed to bypass security controls and to exploit breaches or vulnerabilities within the cyber and information security defenses of financial systems.
In this regard, the Central Bank issued a <strong>draft directive on cyber and information security</strong> to the banking industry.
Chairman, we also issued the <strong>final directive of the Capital Requirement Directive (CRD)</strong> which addresses Pillar one (1) of Basel II/III capital regime.
<br></p>
<p>As we all know, Ghana’s economy is import dependent, hence the existence of persistent foreign exchange demand pressures by importers.
In addition to these huge demand pressures, the seasonal repatriation of profits and dividends foreign-owned companies reflects in significant outflow of resources out of the services and income accounts, exerting additional pressures on the local currency.
As a matter of fact, these developments explain why the two consecutive years of trade surpluses have not fully translated into current account surpluses.<br></p>
<p>The GSE should encourage the listing of more female-owned and run businesses and promote diversity in the management and boards of listed companies, with a fair representation of women.
We must encourage more women to take advantage of emerging technologies to run their businesses and to improve their access to finance.
<p>Media practitioners are called upon to employ high professional standards to determine the <strong>what, when, and how</strong> they report economic and financial news, in order to promote and not undermine confidence in the financial system and the economy as a whole.
Unfortunately, we have sometimes witnessed the opposite, especially during the last 18 or so months during which we have undertaken extensive reforms with a view to making the banking sector more resilient.<br></p>
ANNUAL DINNER OF THE CHARTERED INSTITUTE OF BANKERS (GHANA) ADDRESS BY DR.
ERNEST ADDISON, GOVERNOR, BANK OF GHANA THE STATE BANQUET HALL, STATE HOUSE, ACCRA DECEMBER 02, 2017 1 | P a g e The President of the Chartered Institute of Bankers, Chief Executive Officer of the Institute of Bankers, Fellows of the Institute, Members of the Banking Fraternity, Distinguished Guests, Ladies and Gentlemen Introduction 1.
Good evening to you all.
It is an honour and a great pleasure to be here tonight.
Not to forget, it is also my first time in my role as Governor of the Bank of Ghana to address this annual event which brings the finest banking professionals and other stake holders in the financial industry .
Certainly, this joyous occasion should provide us the opportunity to de- stress from our very busy schedules and a rather challenging year for the banking industry.
We do have sumptuous meals to eat tonight, and while doing that, I will crave your indulgence over the next few minutes to discuss two key issues deemed critical for the central bank’s vision of building stronger and resilient banks in the economy.
These are building a stronger economy for robust and resilient banks and strenghtening the corporate governance structures of our institutions within the broader financial sector plan.
We have started seeing some recovery in the economy after a period of slow growth attributed to challenging domestic and external conditions, with a sharply deteriorated fiscal position due to weak revenue mobilisation and unconstrained spending in the round up to the elections.
The large fiscal imbalance impacted on the current account balance leading to a significant deterioration.
By the end of 2016, the macroeconomic risks in the economy with inadequate international reserves, a volatile exchange rate, high inflation and rapid accumulation of public debt was a source of concern.
These developments were compounded by the energy crisis and disruptions in oil production.
The weak economy and problem in the energy sector affected the banking industry with high non performing loans.
The environment of high inflation and high depreciation eroded the capital base of banks in real terms and coupled with the impact of the required provisioning due to non performing loans, led to a need for several banks needing to rebuild their capital buffers.
The decline in the real capital base of banks when macroeconomic environment is weak provides ample reason why macroeconomic stability must be of utmost priority for building a strong and sustainable banking sector.
3 | P a g e 5.
Ladies and gentlemen, this is exactly what the first order of business of the new government sought to do.
The macroeconomic framework of the 2017 budget was anchored on unwinding the large economic imbalances to restore stability.
These included bold policy initiatives aimed at fiscal consolidatio n focusing on tightening expenditure controls and plugging revenue leakages as well as re- profiling short-term debt into long-term instruments to create some fiscal space.
The se were complemented by monetary policy management strategies to lower inflation and ensure exchange rate stability.
The results are clear for all to see: In the year to date, these policies have started gaining roots —inflation has fallen from 15.4 percent at the end of 2016 to 11.6 in October 2017.
As a result, the policy rate has been lowered by about 550 basis points with commercial bank lending rates also coming down by some 150 basis , although banks are expected to do better.
In addition, there has been relative stability on the foreign exchange market with the cedi deprecia ting against the US dollar by 4.
6 percent since the beginning of the year compared to the same period average of about 17 percent depreciation over the last three years.
In addition, economic growth is gradually rebounding supported by significant 4 | P a g e improvements in electricity supply, higher crude oil production and some government initiatives targeted at boosting agriculture and manufacturing activities.
In the second quarter of 2017, real GDP growth was estimated 9.0 percent as compared with 1.1 percent sam e period of 2016 and projected to reach 7.9 percent by end 2017.
There is no doubt that the current policy debate is about how to move from stability to accelerated growth and employment generation.
This is the new paradigm shift we are targeting.
However, Madam President, there is no doubt about the fact that macroeconomic stability must remain the necessary condition to facilitate the growth and development objective.