As a result, commercial banks also bear greater responsibility to their customers in earning interests on such deposits.

The latest banking sector report by the Bank of Ghana shows that deposits accounted for 62.5 percent of the banking industry’s assets as at December 2017.

According to the central bank’s data, total deposits went up by some 6.67 billion cedis between December 2016 and the same period last year.

For the twelve months period, total amounts deposited with all banks amounted to 58.28 billion cedis.

This is up from the 51.66 billion cedis recorded in December of the preceding year.

84.2 percent of all deposits came in as domestic currency while the remaining 15.8 percent came in foreign currency.

Borrowings by commercial banks also came in as the second source of funding for commercial banks accounting for about 16 billion cedis of the funding needs of the banks.

By this, commercial banks were able to raise money for their operations from short and long term instruments.

Although income from loans to customers dropped between December 2016 and the same period last year (46.4 percent in December 2017, from 50.7 percent in December 2016), it perhaps still leads as income generating source for banks.

A situation, the central bank attributed to the drop in lending rates as well as the rising Non Performing Loans.

Meanwhile, the share of income from investments (both short and long term) increased from 33.5 percent in December 2016 to 38.0 percent in 2017, justifying the shifts in banks’ portfolio preferences despite declining money market rates.

Also, the money that the banking industry made from fees and commissions such as ATM card use dropped from 10.6 to 10.2 percent between the twelve month period.

While ‘other’ income, recorded a marginal increase from 5.2 percent to 5.5 percent during the period under review.

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By: Pius Amihere Eduku/citibusinessnews.com/Ghana

The post Deposits still major source of funds for banks – BoG report appeared first on Citi 97.3 FM - Relevant Radio. Always.

According to the Bank of Ghana, the businesses constituted 80.6 percent of loan default attributable to the private sector for last year compared to the estimated 7.9 percent of loan default attributable to the private sector recorded by foreign businesses.

This is among the key findings of the Banking sector report for January this year.

The report catalogued operations in the banking industry as at December 2017.

Between December 2016 and the same period last year, the total loans that banks offered to their customers increased from 35.4 to 37.66 billion cedis.

The Bank of Ghana’s report also put the banking sector’s non-performing loans (NPLs) at 8.58 billion cedis as at the end of last year compared to the 6.14 billion cedis recorded in the preceding year.

Even though loan disbursements to both indigenous and foreign private sector businesses went up for the period, the local private businesses defaulted most in terms of repaying the loans.

Of the ninety-four percent loan default attributable to the private sector, indigenous private enterprises accounted for as much as 80.6 percent of total NPLs in December 2017 compared with a share of 78.9 percent in 2016.

Their foreign counterparts on the other hand, managed to bring their percentage of loan default down to 7.9 percent from 13.2 percent in the preceding year.

Meanwhile the public sector’s contribution to the industry’s NPLs increased from 3.2 percent in December 2016 to 5.7 percent in December 2017.

It is however not certain, what factors accounted for the inability of local businesses to repay for loans contracted from banks.

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By: Pius Amihere Eduku/citibusinessnews.com/Ghana

The post Local businesses worst loan defaulters in 2017 – BoG report appeared first on Citi 97.3 FM - Relevant Radio. Always.

This is because the Electricity Company of Ghana (ECG) has explained that the reduction will only reflect on the bills of consumers when they make their second purchase of credit for electricity for April.

The latest also follows the shift of the implementation date of the tariff reduction from March 15, 2018 to April 1, 2018.

The Public Utilities Regulatory Commission (PURC) on March 5, 2018, announced a reduction in electricity tariffs of between 17.5 and 30 percent for residential and commercial consumers to ease the burden of the high cost of electricity in the country.

The power distributor had earlier explained that the implementation date of 1^st April was due to its monthly billing system which could not immediately effect the change after the announcement in March.

Though some of ECG vendors had earlier told Citi Business News that the reduction had not been effected on April 1^st, a vendor at Circle confirmed to Citi Business News the situation has changed as of Tuesday, April 3^rd.

“The subsidies have started reflecting, unlike yesterday when you came here to check. So for today I can confirm that it has started reflecting”.

The Public Relations Officer for the Accra East Region of the ECG, Isaac Nurris Ainooson also explained to Citi Business News that consumers should see the reduction upon their second purchase this month.

“We told customers that when you vend on the 1^st of April , the first vending would aggregate your consumption for the whole of March and would give you the credit refund due you from the 15^th to the 31^st of March”, he stated.

He added, “so those who went to our vending points to deposit money for the first purchase, some of them saw the tariff as in the subsidies and all that and in the second vending, whatever is due you from the 15^th to the 31^st of March will be given to customers”.

But one customer who spoke to Citi Business News at the ECG vending point in Osu said she has been left disappointed after making her first purchase in April only to realize that the tariff reduction has not reflected on her purchase.

“Every month I pay one hundred Ghana cedis but now I pay more than that, I came today to purchase credit hoping to see the tariff reduction on my receipt but unfortunately for me, it’s the same just like the old ones, so I will have to wait until my next purchase”.

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By: Anita Arthur/citibusinessnews.com/Ghana

The post New electricity bills to start with second purchase in April – ECG appeared first on Citi 97.3 FM - Relevant Radio. Always.

Secretary of the Senior Staff Association of BOST, Ekow Sey claims that some Bulk Oil Distribution Companies (BDCs) and highly placed individuals, who form the cartel, have since October last year (2017), prevented BOST from importing petroleum products into the country.

Speaking to Citi Business News, Mr. Sey warned of dire consequences if nothing is done to break up the growing cartel within the petroleum sector.

“As we speak now, BOST is the only entity that has been given the mandate to ensure that we keep strategic stock for the country.  The question we should ask ourselves is that a state company that has been given such a huge responsibility, why is it that from October till date people are trying so hard to put obstacles in our way to bring in petroleum products for strategic reasons. For fuel insecurity, I can’t speak about it in detail but you can make some analogy and draw some inference and get your answer.”

Mr. Sey also highlighted the difficulty BOST faces in maintaining the needed level of strategic stocks of petroleum products, in the face of attacks from the cartel.

“The BDCs have no mandate to keep strategic stocks for the country. So they can dispose of any products they have. But in the event that there are issues and we run out of petroleum products, who is going to ensure that we have strategic stocks for the country? It is only BOST, and once we are not allowed now, with impediments and some obstacles being put in our line of operation, it is very clear that very soon there’ll be fuel shortage within our pumps and within the market.”

In an earlier statement to express their displeasure at developments within the petroleum industry attributable to cartels, the Senior and Junior Staff Associations asserted that the great cartel has been in the system for long and will only be suppressed when the President, the Vice President, Chief of Staff and the Energy Minister understand the important role that BOST can play to bring petroleum prices down.

“Government should know that in the deregulation petroleum regime like ours without any giant governmental agency playing a role;  even if the government removes all taxes the private sector which now controls the industry will replace it with profit in a smart way leaving the ordinary consumers in their vulnerable state; hence reducing taxes is not the ultimate option,” the statement added.

On the part of Mr. Mampaya, the Chairman of the Junior Staff Union he categorically stated that in most cases those in right positions to deal with the problems are given wrong advice.

He cautioned that if the government ignored their advice, “this great cartel whose members have made themselves kingmakers can worry the government in 2020 election because the ground is being prepared for that.”

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By: Bobbie Osei/citibusinessnews.com/Ghana

The post Fuel crisis looms over cartel in petroleum industry – BOST workers appeared first on Citi 97.3 FM - Relevant Radio. Always.

The TIN, according to the GRA, is aimed at uniquely identifying potential taxpayers to broaden the tax base.

The Authority has, in recent times, announced that all Ghanaians working must acquire a TIN to fulfill the Revenue Administration Act (RAA), 2016, Act 915.

Some of the institutions that will require TIN are the DVLA, RGD, Passport Office, GRA, Lands Commission, Law Courts, Ministries, government departments, agencies, metropolitan, municipal and district assemblies.

Addressing journalists at a press conference, the Commissioner-General of the GRA, Emmanuel Kofi Nti warned that institutions mandated to check the TIN must do so before transacting businesses with the public.

“One cannot transact business with these institutions if one does not have the TIN. One cannot clear goods from the ports, register land documents with the Lands Commission, obtain a Tax Clearance certificate from the  GRA, open a bank account, register your company, and obtain payments for jobs or contracts done for government,” he stressed.

He added that without the TIN, a person cannot file a case at the courts, bid for contracts from government agencies, conduct business with any ministry, departments, agencies, metropolitan, municipal and district assemblies.

Mr. Nti explained that this is to help increase the number of people currently issued with TIN; a total of 1,090,338 people.

He disclosed that the GRA has already held series of meetings with the key institutions that must help inspect the TIN to ensure the smooth operations of the policy.

“These institutions have been requested to modify their forms to include a field for the provision of TIN. Consequently, GRA expects the institutions mentioned above to demand the TIN of their clients before transacting business with them,” he said.

Sounding a word of caution, Mr. Nti stressed that refusal to inspect the TIN will mean a breach of the law, which will attract the necessary consequences.

He explained that to get the TIN, “one only needs to pick a registration form from any GRA Office, complete and attach the necessary coloured photocopies of a Driver’s license, National Identification Card, Voter’s Identification Card, or a passport and submit at  no cost to the GRA.”

He stated that it is important for Ghanaians to pay their taxes since that is the only way government can redistribute wealth to cover the poor and vulnerable in the society.

“I think we must be tax compliance because that is the only way we can be part of the state and demand development from government. Everybody working must make it a point to pay their taxes.”

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By: Lawrence Segbefia/citibusinessnews.com/Ghana

The post You can’t do business with gov’t without TIN – GRA warns appeared first on Citi 97.3 FM - Relevant Radio. Always.

When I moved out of Ghana to US and Canada, one thing that I have seen separate Ghana from those two countries is that the little things matter.

Sometimes we blame other people for the state of affairs of our country, but I think 99% of our problems are self-inflicted.

If you are a bank in Ghana, make no mistake you are competing with other countries for capital and interbank dealings, an investor & treasurer will most likely chose a bank that was on time to publish its Financial Statement.

March 29, 2018 was the deadline according to subsection 2b of section 90 of the Banks and Specialized-deposit taking Institutions, Act 2016 (Act 930) for all Banks in Ghana to publish their full financial statements (FS) and not the condensed FS on their websites.

At end of the day, only 2 banks had so far done the right thing: Societe General Ghana & CalBank.

What surprises me is that the head-office of 13 foreign controlled Banks have published their group annual FS.

With this attitude, how can a bank from Ghana raise bonds outside, I do hear Nigeria Banks raising Eurobonds etc. but I have not heard of such story about banks from Ghana raise any Eurobonds.

So my questions are as follows;

1. When will banks in Ghana start doing the right thing when it comes to timely publication of FS on website?
2. Same thing happened in 2016 and I am not aware of BoG penalty on Banks, so when will Bank of Ghana start doing the right thing by applying subsection 3 of section 90 of Act 930?
3. When will Securities and Exchange Commission of Ghana and Ghana stock exchange start doing the right thing by ensuring that  listed banks like Ecobank, Access, ADB, SCB, HFC and GCB publishes their full FS by deadline date?
4. Have BoG received all FS and long form reports of all banks?
5. When will some auditors in Ghana stop treating financial statements as if it is their financial statements and focus on ‘must have’ and instead of focusing on ‘Nice to have’.

Honestly, I don’t see the issue we have in Ghana, it is simple, you agree your FS notes and everything with auditors before December and auditors also audit 11 months up to December and come January, it is just the numbers.

Here in Canada, aside from other roles I play in Bank, I lead a reporting team as well, we have October year end, by November we are done with everything and December first week we then publish the FS.

Act 930

90. (1) A bank or specialised deposit-taking institution shall exhibit at each of its branches or agencies in a conspicuous place throughout the year, a copy of the last audited financial statement in respect of the operations of the bank or specialised deposit-taking  institution.

(2)          A bank or specialised deposit-taking institution shall

(a)          In the case of a bank not later than three months after the end of its financial  year; or

(b)          In the case of a specialised deposit-taking institution not later than four months after the end of each financial year,

furnish the Bank of Ghana with a copy of its audited financial statements together with the auditor’s statutory and long form audit reports; and cause the financial statements together with the auditors’ reports to be published on its website if any and in at least two daily newspapers of national circulation.

(3)          A bank or specialised deposit-taking institution which fails to comply with this section is liable to pay to the Bank of Ghana, an administrative penalty of not more than one thousand penalty units.

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Author: Emmanuel Akrong

Credit Consultant

The post 32 banks fail to comply with financial statement publication rules (Article) appeared first on Citi 97.3 FM - Relevant Radio. Always.

This is due to the full implementation of the recently announced electricity tariff reduction from residential and non-residential power users in the country.

The Public Utilities Regulatory Commission (PURC) in March announced a reduction in electricity tariffs of between 17 and 30 percent for residential and commercial consumers.

Though the reduction was scheduled to take effect on March 15, the ECG suggested that its monthly billing system couldn’t allow the immediate implementation.

The Managing Director of the ECG, Engineer Samuel Boakye-Appiah in an earlier press conference explained why the reduction could not take effect as indicated.

He said that “the monthly billing cycle of the prepayment metering system does not technically allow ECG to implement the review in the middle of the month”.

“Consequently, prepaid customers of ECG should note that the programming of the billing system will refund the reduction from the implementation date of the 15th to 31st March 2018. When they deposit cash or purchase electricity from 1st April 2018 onwards,” he added.

Engineer Boakye-Appiah pointed out that, the prepayment system will detect aggregate purchase for consumers in March, and then compute the reduction due them, from the effective date of 15th March to 31st March.

“This will be refunded to you on your next visit to vending point”.

He stated that the average percentage reduction, which is 15.5 percent for residential, 30 percent for non-residential, 25 percent for SLT and 10 percent for the mines, effective 15th March 2018 is only on energy consumption.

“Therefore the addition of statutory levies and other fixed charges will reduce the average percentage relief announced by the PURC”, he noted.

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By: Jonas Nyabor/citifmonline.com/Ghana

The post ECG tariff reductions take effect today appeared first on Citi 97.3 FM - Relevant Radio. Always.

The Bank’s optimism is premised on its performance for last year (2017) where it recorded a profit after tax of 386.17 million cedis.

The Finance Director at Barclays Bank Ghana, Antoinette Kwofie disclosed this plan when she engaged journalists to explain the reasons accounting for the bank’s performance in 2017 on Thursday, March 29, 20180.

A year-on-year comparison of Barclay’s Bank’s financial results shows that between 2016 and 2017, Barclays bank’s profit went up by about 82 million cedis from the 304.53 million cedis recorded in 2016.

In 2017 also, the bank’s income such as interests on loans, as well as fees and commissions charged for use of ATMs for instance, went up 887.29 million cedis in 2017.

Equally, the bank spent a bit more on its expenditure including income taxes as well as personnel expenses in 2017.

Total expenses amounted to 337 million cedis in 2017 against the 291.79 million cedis recorded in the preceding year (2016).

Speaking to Citi Business News on the performance, the Finance Director at Barclays Bank Ghana, Antoinette Kwofie attributed the profitability to improved efficiency.

“This year you will see growth of 12.7 percent; between 2015 and 2016, you see a higher year on year growth compared to this figure. So the operational efficiency that we are putting in place to deliver better value to the customers and also to keep our cost within manageable range, is what is leading to the declining growth,” she stated.

Also, weighing Barclays Bank’s assets against its liability, which is the capital adequacy ratio, stood at 20.45 percent against 19.04 percent in 2016.

Meanwhile the Non-Performing Loan ratio stood at 13.6 percent compared to 19.17 percent.

Antoinette Kwofie also believes Barclays should sustain its strong performance and contribute to the new Africa Group brand, ABSA, later this year.

“Actually Ghana is one of the top three businesses outside of South Africa in the ABSA Group. In actual fact, of all the countries outside of South Africa, we were the most profitable in the group,” she added.

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By: Pius Amihere Eduku/citibusinessnews.com/Ghana

The post Barclays Bank Ghana posts GH¢386m in profits in 2017 appeared first on Citi 97.3 FM - Relevant Radio. Always.

The IES believes this will also defeat the immediate claims by the government of reducing the cost of power produced from the power barge.

The comments come on the back of government’s extension of the agreement with Karpower by ten more years.

The government is convinced that the extension is a good deal agreed on citing varied reasons.

However, the opposition NDC insists the extension is a mere indication of been vindicated.

The various players have been sharing their perspectives with Citi Business News on the extension which is expected to bring the cost of power per kilowatt hour down from 16 to 10 cents.

Click to listen to full audio report.

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By: Pius Amihere Eduku/citibusinessnews.com/Ghana

The post Karpower deal extension: IES warns of rise in power cost (Audio) appeared first on Citi 97.3 FM - Relevant Radio. Always.

According to her, the NCA has not been clear on its policy direction towards improved internet coverage in the country.

Madam Motman has therefore urged the NCA to open up the discussion on the acquisition of a 5G spectrum by telcos in the country.

Addressing journalists at a press conference, Roshi Motman disclosed that AirtelTigo is however working towards the acquisition of a 5G spectrum to ensure quality service to its customers.

“Acquiring a 4G is a natural progression but actually as a company, we are looking towards acquiring a 5G spectrum because in reality it’s time for 5G in the world and not really 4G. So it’s a bit sad that in Ghana the situation is the way it is. I also believe that it is not necessary to as a company move from 2G to 3G and then to the next when there is a more developed one out there, you can go straight onto 5G”.

Roshi Motman explained that both parent groups of the merged entity are working towards acquiring a 5G spectrum,

“Both our groups, we have the Bharti Airtel Group and the and the Millicom group that are behind this venture are both investing in 5G and we are now bringing on board experts to really have a look at how this can be positioned in this market”.

The move of the company to acquire a 5G spectrum comes despite pleas by the telcos to reduce the cost of acquiring a 4G spectrum.

The second 4G spectrum has been left untaken after MTN acquired the first one in 2015.

MTN, together with three other companies back then; Surfline, Goldkey and Migson communications all submitted applications for the spectrum but only MTN was able to cough up the floor price for the spectrum which was 67.5 million dollars.

The spectrum allows the telecom operator to provide improved internet services to customers as it has a faster speed and enhanced features.

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By: Anita Arthur/citibusinessnews.com/Ghana

The post Airtel Tigo joins calls for 5G network in Ghana appeared first on Citi 97.3 FM - Relevant Radio. Always.