Investments remain the banks’ main income; constitute 48.5% of assets – BoG

Investments, including government securities such as treasury bills and bonds, remained the main component of bank income in February 2022, although their share moderated to 48.5% from 51.1 % over the same period a year ago.

According to the Bank of Ghana, loan interest income was the second largest source of income for banks, with a lower share of 30.6% compared to 31.1% during the same comparative period.

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

Meanwhilethe sector remained profitable overall during the period under review, despite the slight increase in operating costs relative to revenues.

The sector’s cost/income ratio increased slightly to 78.0% in February 2022 from 77.2% in February 2021, while cost/total assets improved slightly to 1.7% from 1.8% over the period considered. Following the increase in operating expenses during the reporting period, the ratio of operating expenses to total revenues increased slightly to 52.2% from 51.7%, while that of operating expenses Operating in total assets remained unchanged at 1.2% during the period under review.

Again, industry operating expenses also increased significantly by 21.3% in February 2022, after registering a slight contraction of 0.3% during the same period in 2021, due to the increase in personnel costs and other operating expenses.

Despite improved revenue performance, increased operating expenses moderated net operating income growth to 13.3% in February 2022 from the 17.1% growth recorded during the corresponding period last year.