A member of the Finance Committee of Parliament, Isaac Adongo is predicting difficult times for the country's banking sector following reported cases of coronavirus in Ghana.

“Now that we have the coronavirus, businesses are not going to be able to raise letters of credit to import from China and other places, which is a major source of credit generated by our banks.

"The fees and charges they get from those transactions are not going to happen. Cooperate bodies will be struggling to make sales and therefore they cannot even raise the revenue to come and pay the loans that they have contracted in the banks.

"What this means is that these loans are going to go bad and will be written off further against the government,” he said.

The deadly COVID-19 which has claimed more than 7,500 lives, has devastated several sectors of the world leading to fears of an economic recession.

The country has not been spared the effects of the coronavirus with seven persons so far being confirmed to have the virus.

This has resulted in a decision by government to turn to the International Monetary Fund (IMF) and World Bank for money to shore up the economy.

Finance Minister, Ken Ofori-Atta, told Parliament on Tuesday, March 17 that preliminary analysis undertaken by his ministry has shown the coronavirus will cause a funding gap in the economy.

The Finance Minister also said the spread of the virus will affect tourism, travel, conferences, foreign direct investment and international trade.

With several businesses shutting down and schools closing, the MP for Bolgatanga Central believes the banking sector will suffer the most from the measures put in place.

“We have a very, very dangerous financial situation now and yet Bank of Ghana will paint a different picture but the facts just don’t support it.

"They will say deposit has gone up but if you look at the deposit, we all know that in March 2019, after the last batch of banks that were collapsed, we issued a bond of ¢1.5 billion to cover their deposit in March. So when you do that, what you have to do immediately is add ¢1.5 billion to their deposit that doesn’t exist. 

"Now because you were given a bond, you will immediately see an increase in your banking assets by ¢1.5 million because it will go into the investment assets. So you see, your key measures have been distorted.”