{"id":348812,"date":"2017-08-29T05:50:53","date_gmt":"2017-08-29T05:50:53","guid":{"rendered":"http:\/\/citifmonline.com\/?p=348812"},"modified":"2017-11-10T10:36:59","modified_gmt":"2017-11-10T10:36:59","slug":"banks-reduce-mortgage-loans-over-high-npls-bog","status":"publish","type":"post","link":"https:\/\/citifmonline.com\/?p=348812","title":{"rendered":"Banks reduce mortgage loans over high NPLs \u2013 BoG"},"content":{"rendered":"<p>Banks have begun tightening their stance on mortgages due to the rise in their Non-Performing Loans (NPLs).<\/p>\n<p>At least according to the Bank of Ghana\u2019s latest banking sector report, the commercial banks decreased their loans for house purchases by some two percentage points from 8 to 5 percent as at June this year.<\/p>\n<p>The position by the commercial banks according to the Bank of Ghana\u2019s banking sector stability report comes despite the increase in demand for loans for house purchases by households.<\/p>\n<p>At least the report indicates that the demand for loans for house purchases went up marginally from 5 to 6 percent between April and June this year.<\/p>\n<p>However, the commercial banks largely attribute their tightening in loan levels to the\u00a0<strong><span style=\"color: #800080;\"><a style=\"color: #800080;\" href=\"http:\/\/citibusinessnews.com\/index.php\/2017\/08\/24\/banks-npls-hit-8-billion-cedis-bog-report\/\" target=\"_blank\">rise in their non-performing loans<\/a><\/span><\/strong>\u00a0which went up by 31 percent; from 6.09 to 7.96 billion cedis as at the end of June this year.<\/p>\n<p>According to the central bank, total loans offered by the banks locally, grew by 3 percent to 37.51 billion cedis in June.<\/p>\n<p>This also came after an 8 percent contraction in the same period last year.<\/p>\n<p>Unlike the real credit to the private sector which equally went up by 2.6 percent after recording a negative growth rate of 8.2 percent a year earlier, credit to households contracted by 0.7 percent in June 2017 compared with a 2.3 percent contraction in June 2016.<\/p>\n<p>But it is interesting that this reduction in loans for house purchases by the commercial banks come at a time that mortgage houses are announcing a reduction in cost of cedi mortgages.<\/p>\n<p>The CEO of Ghana Home Loans, Mr. Dominic Adu earlier told\u00a0<strong>Citi Business News<\/strong>\u00a0that the stability of the cedi has led to over a\u00a0<span style=\"color: #800080;\"><strong><a style=\"color: #800080;\" href=\"http:\/\/citibusinessnews.com\/index.php\/2017\/08\/07\/cedi-stability-drives-mortgage-rates-down-by-40\/\" target=\"_blank\">forty percent reduction in cost of cedi mortgages<\/a>.<\/strong><\/span><\/p>\n<p>Meanwhile the average interest on mortgages by commercial banks remained at 33.1 percent between June and July this year.<\/p>\n<p>&#8211;<\/p>\n<p>By: Pius Amihere Eduku\/citibusinessnews.com\/Ghana<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Banks have begun tightening their stance on mortgages due to the rise in their Non-Performing Loans (NPLs). At least according to the Bank of Ghana\u2019s latest banking sector report, the commercial banks decreased their loans for house purchases by some two percentage points from 8 to 5 percent as at June this year. The position [&hellip;]<\/p>\n","protected":false},"author":14,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jnews-multi-image_gallery":[],"jnews_single_post":[],"jnews_primary_category":[],"jnews_social_meta":[],"jnews_override_counter":[],"footnotes":""},"categories":[121,32,171,11],"tags":[],"class_list":["post-348812","post","type-post","status-publish","format-standard","hentry","category-banking-and-finance","category-business","category-local-economy","category-top-stories"],"_links":{"self":[{"href":"https:\/\/citifmonline.com\/index.php?rest_route=\/wp\/v2\/posts\/348812","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/citifmonline.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/citifmonline.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/citifmonline.com\/index.php?rest_route=\/wp\/v2\/users\/14"}],"replies":[{"embeddable":true,"href":"https:\/\/citifmonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=348812"}],"version-history":[{"count":0,"href":"https:\/\/citifmonline.com\/index.php?rest_route=\/wp\/v2\/posts\/348812\/revisions"}],"wp:attachment":[{"href":"https:\/\/citifmonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=348812"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/citifmonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=348812"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/citifmonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=348812"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}