The Chief Executive of Stanbic Bank, Alhassan Andani, says initiatives by the Bank of Ghana (BoG) such as the licencing of credit bureaus and the creation of a Central Securities Depository have been a great help to the banking industry.
He said credit reference bureaus and the new credit reporting regime have made it easier for banks to assess borrowers and limited credit risk in the industry.
“Credit reference bureaus have contributed to the growth of the industry significantly. Now every credit paper we write on anybody has to have a report attached to it, even if it has to say the customer has no bank account with any bank. Otherwise, the report will tell us the performance of the customer with other banks," he said in an interview with B&FT.
“So the industry now has a single view of every customer, which is very brilliant and secure for industry players."
He said in the past clients could be 'robbing Peter to pay Paul', using two or three banks, but now this is impossible.
“This is because in the past you could be so stressed out by one company - which you may even be battling in court - whereas that same company could be one of the top-five clients of another bank. But with the credit reference bureau, that can’t happen anymore," he said.
In 2007 Parliament enacted a Credit Reporting Act that laid the framework for licencing private credit reference bureaus by the BoG. Subsequently, in December 2008, the Central Bank licenced the country’s first credit reference bureau.
Mr. Andani also lauded the introduction of a Central Securities Depository (CSD) by the Bank of Ghana.
“This is also of fantastic help, because people were simply duplicating leases and taking the same lease to different banks until later you realise that you are being played. But now there is a securities depository where we all go and put the leases in one register, and the most important thing is that you cannot duplicate leases anymore.
“The credit reference bureaus and securities depository have been of great help, and again this is the facilitative role that the Central Bank is playing to ensure that there is general health of the credit book for the whole industry,” he added.
Between 2010-12, banks’ gross loan book increased by 63 percent to GH¢13 billion, and the non-performing loans ratio fell from 17.6 percent to 13.2 percent.
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