The Minister of Finance, Ken Ofori-Atta says the fundamental objectives of special-purpose banks such as the NIB and ADB would have to be reviewed to help them secure the necessary capital so they can give out long-term funds as the government makes moves to establish a development bank.
The Government of Ghana, in partnership with the European Investment Bank, and other international development institutions, has committed to the establishment of a new development finance institution in Ghana to provide the needed capital for Ghana’s industrialisation agenda.
Some industry players have questioned the sustainability of yet another development Bank when the likes of the National Investment Bank (NIB) and the Agricultural Development Bank (ADB) do not appear to have lived up to expectations.
Addressing a corporate dinner series for CEOs of Large Corporates, organised by the Association of Ghana Industries, Finance Minister Ofori-Atta said the focus of other development banks would have to be reviewed.
“And the question has always been; what about the NIB and ADB and that is a case of mission creep. As you know, interest rates went crazy and everyone wanted to be a universal bank and to be able to take deposits, and the government itself did not have the resources to continue to feed the banks with the long term capital that was needed for the NIB and ADB to continue with their original roles as were perceived, so that began the demise of those institutions,” Mr. Ofori-Atta explained.
Mr. Ofori-Atta further noted that “We need to redirect what NIB and ADB will become so that they also have the needed capital to be able to give long term financing, at least in the areas of industry and agric.”