https://www.myjoyonline.com/bog-warns-savings-loans-companies-over-increasing-interest-cost-npls/-------https://www.myjoyonline.com/bog-warns-savings-loans-companies-over-increasing-interest-cost-npls/
Osei Gyasi

The Bank of Ghana is warning Savings and Loans Companies to take a critical look at the rising cost of interest and non-performing loans on their books.

According to the Head of Banking Supervision, Osei Gyasi, this could trigger some financial risks which may have an effect on profitability.

Speaking at the launch of the 20th anniversary of Bayport Savings and Loans in Accra, Osei Gyasi said the Central Bank is concerned about the quality of financial assets.

He informed shareholders and customers that the Central Bank has identified some of these happenings which will need to be addressed as soon as possible.

“We have observed some marginal increases in Non- Performing Loans", he said adding that "companies should manage this to improve the asset quality and enhance the profitability of their institutions”.

“Savings and Loans companies will also have to diversify their funding sources to reduce the leverage ratio and also cut down interest cost otherwise, financial risk could crystalize. So these are the areas companies should be looking at to make more profit for shareholders, to improve customer confidence and profitability so they can lend more to grow the economy”, he added.

Osei Gyasi also advised financial service providers to diversify their sources of funding to reduce the high cost of credit.

The Central Bank commended Bayport for its growth trajectory as its total assets increased significantly. The bank recorded ¢27.42 million profit in 2022, higher than in 2021.

This the Central Bank described as a remarkable growth in the 20 years journey of Bayport.

Osei Gyasi also lauded Bayport for its significant contribution to the financial inclusion drive of the country.

Managing Director of Bayport, Akwasi Aboagye, said his outfit will take strict steps to ensure its sustainability and comply with the directive from the Bank of Ghana.

The theme for the anniversary is "Celebrating 20 years of needs met, opportunities created, plans accomplished, hopes realised and dreams fulfilled".

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