Question

1. Examine the impact of the banking sector clean up on investment activities in Ghana.

Answer 1

The Bank of Ghana recently announced the completion of the financial sector clean up after the last badge of the savings and loans who failed to meet new capital requirement had their licenses revoked and the said banks either consolidated, absorbed, downgraded or dissolved. Those who feel hard done have shared their grievances, some have headed to court whereas others have accepted their fate.

Now it is now beleived there that the management should not rely on interest income as the sole source of revenue but rather put much effort in increasing revenue through non-interest income streams. The investment activities in Ghana have reduced drastically. The banks have lost the trust of the people living there. The results again imply that Ghanaian bank management should place emphasis on having lean employees size, and increase the banks' business by mobilizing more deposits and advancing more quality loans. Management should again ensure a reduction in operational expenditure through minimization of wastages and cost cutting to improve operational efficiency.