New loans advanced by banks from January to June 2022 amounted to GH¢24.6 billion, the Bank of Ghana (BoG) has revealed.

The Banking Sector Development Report by the central bank reveals that new loans have increased by 54% as against the same comparative period last year, which saw a growth of 1.0%.

“On a year-to-date basis, gross loans and advances increased by 17.5 percent in the first six months of this year, a recovery from the contraction of 0.5 percent recorded during the same period in 2021,” part of the statement added.

Per the report, the stock of gross loans and advances increased by 33.3 percent (year-on-year) to GH¢63.4 billion at the end of June 2022.

This growth is substantial compared to the growth of 5.7 percent recorded in June 2021.

The largest share of credit, 34.1% went to the services sector.

The commerce, finance and construction sectors had shares of 21.3% and 10.2% respectively.

“These top three sectors together accounted for 65.6 percent of total credit in June 2022, compared with 60.3 percent in June 2021. The other economic sectors accounted for the remaining 34.4 percent in various proportions in June 2022,” the report said.

The mining and quarrying sector remained the lowest recipient of the industry credit with a share of 2.1 percent.

The 2022 credit share received by the sector was less than the 2.2 percent share in the previous year.

Private and Public sector Private sector credit grew by 33.7percent to GH¢57.2 billion in June 2022, compared with a growth of 6.8 percent in the previous year.

Accordingly, the private sector share of total credit increased marginally to 90.2 percent in June 2022, from 89.9 percent in June 2021.

Public sector credit also recorded a growth of 29.3 percent to GH¢6.2 billion, compared to a contraction of 2.8 percent in the previous year.

The share of public sector credit, however, declined marginally from 10.1 percent to 9.8 percent on account of the lower annual growth rate in public sector credit relative to the growth in private sector credit in June 2022.

Source: The Independent Ghana