it first hit and, little by little, it transformed from a mortgage crisis into the deepest global crisis since the great depression. the response to the crisis and the lessons drawn from it followed in a similar fashion. the approach and extent of response to the crisis was not uniform across the countries. the economies having fresh memories of the financial crises responded swiftly and more strongly. the same can be said for the public and business community in these economies. the economies enjoying a favourable fiscal position also faced the crisis without impairing their long - term fiscal sustainability. the situation seemed slightly more complex in some developed european economies. seeking to find a balance between deleveraging and fiscal consolidation, euro area authorities demanded setting up a protective wall against the possible fire bursting into from the outside. but, as noted, this fire had already burst out and was spreading inside the euro area walls ; therefore, setting up this “ protective wall against fire ” was pointless at this point. the european union and its institutional structures, along bis central bankers ’ speeches with the international financial institutions and partners, are undertaking a number of reforms to put this “ fire ” out. however, it is still unclear how long this “ agony ” will last and likewise is its impact on the euro area and its trading partners. the exhaustion of fiscal and monetary policy incentives failed to increase economic activity and, moreover, it further aggravated the sovereign debt situation and financial stability. consequently, the sovereign debt sustainability and banking system credibility - related issues were added to the concerns about economic growth. the question facing many countries today has the form of a trade - off between stability and sovereignty. currently, the latter two are intertwined in an endogenous relationship ( of mutual impact on one another ), in which the multi - dimensional need for stability ( implying the maintenance of price stability, macroeconomic stability, financial and fiscal stability ) requires taking balancing measures. the latter have considerable social costs in the short run. social discontent against them and the governments proposing them erodes the credibility of reforms and the authorities, increasing, in turn, the sovereign debt risk. euro area, and particularly its southern members, are facing a concern, whose solution bears consequences with economic and political implications for the future of all member states and the common currency. the reforms and policies undertaken by euro area authorities, individually or in a concerted manner, have important and direct implications for our economies. experience to date has shown that our partners and their large banks have adopted an approach that maximizes their

paul a acquah : the emerging ghanaian banking environment address by dr paul a acquah, governor of the bank of ghana, at the official opening of guaranty trust bank ghana ltd. and commissioning of its head office building, accra, 26 june 2006. * * * mr. chairman, his excellency the president of the republic of ghana, honorable ministers of state, directors of guaranty trust bank, distinguished executives of the banking industry, invited guests, ladies and gentlemen, thank you very much for the invitation to be a part of this event. i feel greatly honoured for the opportunity to make a few remarks on the occasion of both the official opening of the guaranty trust bank ghana ltd. and the commissioning of its head office building in these plush surroundings. let me begin by congratulating you on making a successful entry into the ghanaian banking market. this splendid custom - built head office which is your own investment rather than a leased one is the first visible evidence of your long term commitment to operations in the banking industry. i trust that with this commitment, the targets and objectives embedded in your business plan will be achieved. having said that, mr. chairman, let me hasten to add that it would take more than brick and mortar to succeed in the emerging ghanaian banking environment. gt bank is commencing business at a time that the ghanaian economy has gone through a significant transformation. the deepening of macroeconomic stability and the rising gdp growth over the past few years means that banks must position themselves in an increasingly competitive market in which innovation, efficiency and costcontainment have become important for success. this also defines the critical role that banks must play to catalyze the growth process. in the last few years our banking sector has grown stronger as banks have been re - capitalizing, retooling and re - strategizing to fit into the evolving environment. we have sought to engender healthy competition among banks by admitting new banks such as yours into the system, while encouraging existing banks to beef up their capital and adopt universal banking. the result is an evolving competitive banking sector that has witnessed continuing growth in banking sector assets, liabilities and incomes. while in the last few years we have observed rising cost to income ratios, profitability ratios remain high in comparison with sub - saharan averages. therefore there still remains substantial scope for banks to make a good return for shareholders and even more room for reductions in charges and interest rates given prevailing interest rate spreads