Some stakeholders in Ghana\u2019s financial sector have advocated for a return to specialized banking to help target specific areas of the economy for development.<\/p>\n
According to them, such methods are currently being used by developed countries to channel funds to critical areas of their economies.<\/p>\n
The Bank of Ghana(BoG) in an effort to strengthen its regulatory mandate of the banking industry classified all banks as universal.<\/p>\n
But speaking at an event organized by Old Students of Achimota School, the Managing Director of NDK Financial Services, Oko-Nikoi Dzani blamed the reclassification for starving some critical areas of the economy such as agriculture, and housing.<\/p>\n
\u201cThe system used to be this. Commercial banks and what we called Specialized Development banks, so[for instance] bank for housing was there,\u00a0 NIB was there, Merchant banks were also identified as such,\u201d\u00a0 he said.<\/p>\n
He was of the opinion that, the Bank of Ghana\u2019s decision to classify all banks as universal took\u00a0 the specialized funding principle of the banks, making them compete for the same market.<\/p>\n
\u201cOnce you do that you put everybody on the same platform. And mind you, each bank has a shareholder. So people are looking always at the bottom-line,\u201d he argued.<\/p>\n
He pointed out that one advantage of specialized banking is the ability to identify the specific market they serve and provide\u00a0 incentives \u00a0for them.<\/p>\n
\u201cWhen you have specialized banks you will look at instruments like taxes. If it is agric bank what can we do to ensure that people have access to cheaper source of funds. It\u2019s not the matter of going ahead to give the money for agric at a lower rate and not seeing expansion or seeing the volume increase for agriculture produce,” he said.<\/p>\n
He stated that specialized baking will enable the central bank to monitor and guage the level of funds that go into specific areas, hence output assessment.<\/p>\n
\u201cYou wait and after harvest we do arithmetic and say to ourselves that you benefited so much but you were able to produce this. This happens in Japan\u201d.<\/p>\n
–<\/p>\n
By: Lawrence Segebfia\/citibusinessnews.com\/Ghana<\/p>\n","protected":false},"excerpt":{"rendered":"
Some stakeholders in Ghana\u2019s financial sector have advocated for a return to specialized banking to help target specific areas of the economy for development. According to them, such methods are currently being used by developed countries to channel funds to critical areas of their economies. The Bank of Ghana(BoG) in an effort to strengthen its […]<\/p>\n","protected":false},"author":14,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[121,32,171],"tags":[],"yoast_head":"\n