Total assets of the banking sector grew by 33.3 percent to GH¢323.2 billion as at June 2024, relative to a growth of 21.2 percent recorded in June 2023, this is the latest from the Bank of Ghana (BoG) Monetary Policy Report.

It explained that the higher growth in assets was driven by a robust growth in deposits, as well as the depreciation of the Ghana cedi.

“Foreign assets grew by 57.6 percent in June 2024, compared to 74.5 percent in June 2023, while domestic assets grew by 31.0 percent in June 2024, up from 17.8 percent growth same period last year”, it said.

According to the report, the share of foreign assets in total assets increased to 10.2 percent from 8.6 percent, while the share of domestic assets declined to 89.8 percent from 91.4 percent in June 2023.

“Investments grew by 19.2 percent to GH¢107.2 billion in June 2024, up from a growth of 11.0 percent in June 2023, due to a significant growth in both short-term and long-term instruments”.

It pointed out that the growth in investments reflected a 7.3 percent growth in short-term bills, from a growth of 149.6 percent in June 2023, while long-term investments (securities) also grew by 28.6 percent in June 2024, having contracted by 23.2 percent in June 2023.

The mixed growth in both bills and securities investments culminated in a reduced share of investments in total assets to 33.2 percent in June 2024, from 37.1 percent in June 2023. Gross loans and advances rose by 15.6 percent to GH¢84.5 billion in June 2024, relative to a 15.4 percent growth in June 2023. Growth in net loans and advances (gross loans adjusted for provisions and interest in suspense) also moderated to 10.3 percent, from 11.3 percent during the same period last year.

The report stated that the higher growth in assets was funded by increases in deposits and other funding sources. Deposits remained the main source of funding for the banking sector, accounting for 76.1 percent share of total assets in June 2024, from 77.4 percent in June 2023.

Deposits improved by 31.1 percent to GH¢245.9 billion in June 2024, as against 42.8 percent growth recorded in June 2023.

“The foreign currency component of deposits grew by 29.8 percent to GH¢81.2 billion in June 2024, relative to a growth of 62.5 percent in June 2023, suggesting some currency depreciation effect on the overall growth in total deposits”.

According to report, borrowings also picked up by 44.4 percent to GH¢23.2 billion in June 2024, up from 39.1 percent contraction recorded in June 2023.

“The growth in borrowings reflected an uptick in both short-term foreign and domestic borrowings while long-term domestic and foreign borrowings contracted”.

“Short-term domestic borrowings of GH¢15.2 billion at end-June 2024 suggested a growth of 83.0 percent, relative to a contraction of 33.6 percent recorded in June 2023”, it added.

Long-term domestic borrowing, however, contracted by 17.6 percent in June 2024, down from a growth of 45.1 percent during the same period in 2023. Short-term foreign borrowings grew by 33.2 percent, after contracting by 75.7 percent in June 2023, while long-term foreign borrowings contracted by 2.5 percent, from the 16.2 percent contraction registered in June 2023.