Some banks have given indication of cutting their interest rates to reflect the reduction in the policy rate by the Bank of Ghana.
They explain that the move forms part of plans to reduce the plight of businesses and eventually correct the bad loans in their books.
The Bank of Ghana (BoG), in its 75th MPC meeting reduced its prime rate by 200 basis points to 23.5 percent.
Governor of the Central bank, Dr. Abdul Nashiru Issahaku cited declining inflation as basis for the decision.
Commenting on the development, the CEO of First Atlantic Bank, Odun Odunfa tells Citi Business News a slash in interest rates should help grow the banking sector.
“Whatever helps the economy we will support; the banking sector is just one sector in the whole economic chain…rates reduced means things are a bit easier for our customers and this means that things will be a bit better for us,” he stated.
Mr. Odunfa added, “Whatever makes our customers happy and feel better is what we pursue. For us it is a step in the right direction.”
The reduction in the policy rate is among other things expected to lead to a drop in interest rates.
But the CEO of First Atlantic Bank tells Citi Business News his outfit has already begun adjusting its rates to suit the cuts.
He however couldn’t readily disclose the areas and percentage of reduction.
“It is already reflecting… the interest rates for most of our loans have been reduced.”
First Atlantic Bank opens three branches
Meanwhile the bank has since opened its new branches at Dzorwulu and Ring Road in Accra.
The third is expected to be opened in Takoradi.
This is expected to increase the banks network of branches to twenty-seven.
First Atlantic Bank is also expecting to increase its network to thirty-one by the end of 2017.
In addition, the bank says it posted an increase in profit of about thirty-percent between 2015 and 2016.
The 2016 profits amounted to 25 million cedis in 2016.