Investments including government securities such as treasury bills and bonds remained the largest component of banks’ income as of February 2022, although its share moderated to 48.5%, from 51.1% during the same period a year ago

According to the Bank of Ghana, interest income from loans constituted the second largest source of banks’ income, bringing in a lower share of 30.6% compared with 31.1% during the same comparative period.

The share of banks’ income from fees and commissions also moderated to 11.7%, from 12.3%, in line with the slower growth of fees and commissions. The share of other income increased to 9.2%, from 5.5% during the period under review.

Meanwhile, the industry remained broadly cost efficient during the period under review, despite the slight uptick in operational cost relative to income.

The cost-to-income ratio of the industry inched up to 78.0% in February 2022, from 77.2% in February 2021, while cost-to-total assets improved marginally to 1.7%, from 1.8% during the period under review. Following the increase in operating expenses during the reference period, the ratio of operational cost to total income increased marginally to 52.2%, from 51.7%, while that of operational cost to total assets remained unchanged at 1.2% during the period under review.

Again, the industry’s operating expenses also increased significantly by 21.3% in February 2022, after recording a mild contraction of 0.3% during the same period in 2021, from increases in both staff costs and other operating expenses.

Despite the improved income performance, the increase in operating expenses moderated the growth in net operating income to 13.3% in February 2022 compared with the 17.1% growth recorded in the corresponding period last year.