This according to him is due to the central bank’s recent reforms that were done within the banking sector.
The governor who was speaking at the Monetary Policy Committee’s (MPC) press briefing on Monday, May 27, 2019, said the banks in the country are well insulated should there be a shock depreciation in the cedi against its major trading partners.
The local currency has depreciated by more than 5.8 percent against the US dollar since the turn of the year.
“Profitability is also on the rise as banks deploy their additional capital on interest-earning assets. There is also evidence of strong deposit growth in the industry pointing to a return of confidence in the banking sector,” Mr Addison said.
The central bank’s recent data indicated within the first four months of 2019, banks total assets amounted to $21.1 billion (GH¢109.9 billion), representing an annual growth of 12.4 percent.
The growth in total assets was funded mainly from deposits which grew by 19.6 percent year-on-year to GH¢73.1 billion.
However, Mr Addison noted that asset quality remains a key challenge and a major constraint to credit expansion in the banking sector.
He said, “The Non-Performing Loans (NPL) ratio has declined from 23.5 percent in April 2018 to 18.9 percent in April 2019, it remains high and points to the industry’s exposure to credit risk.”
But he is optimistic that the universal banks will work effectively to strengthen their credit risk management and as well recover their loans to curb the menace.