Help Halt Cedi Depreciation - Ashigbey Urges Banks

Ken Ashigbey MD of GCGL presenting the best in Retial Banking Award to CAL Bank

Ken Ashigbey MD of GCGL presenting the best in Retial Banking Award to CAL Bank The Managing Director of Graphic Communications Group Limited (GCGL), has called on players in the financial services industry, particularly the banks, to devise innovative means to help halt the depreciation of the cedi against the major international currencies.

“I am aware of the tremendous roles you have played and continue to play in stabilising the economy among other things and it is against this background that I urge all banks to help devise solutions to arrest the further depreciation of the cedi against the major currencies particularly the dollar”, Mr Kenneth Ashigbey said.

He made the call at the 11th Ghana Banking Awards held in Accra Saturday, at which UT Bank emerged the overall Bank of the Year for the first time in the history of the awards.

The event was on the theme “Leveraging ICT to transform the Financial Services Sector”.

“Over the years, our economy has seen some relative stability and from history, at least from the birth of the 1992 constitution, we have witnessed a fall in the value of the cedi only when it is getting to the general elections and this, as we all know, erodes the gains the economy has chalked”, Mr Ashigbey said.

He stressed that, “It is against this background that, we all need to find a lasting solution to this challenge and I trust the role of the banks in this direction is very much required”.

Since the cedi began losing its strength against its major foreign currencies particularly the dollar, the government, and for that matter the Bank of Ghana (BoG), has come up with a number of interventions including the injection of more than a billion dollars into the economy, within the last three months in an attempt to stabilize the situation.

In spite of this, little seem to have been achieved so far, making the prices of imports to double.

Vehicle spare parts dealers and workers who have taken mortgages to acquire houses, among other people, have been badly affected by the development because the prices of their wares and property are valued in dollars which prices remain fixed but have doubled in cedi terms.

To date, the cedi is reported to have lost 20 per cent of its value against the cedi in the last three months or more.

“I know that you will say that you are just intermediaries in the foreign exchange trade, but you agree with me that of the three markets of the foreign exchange, it is the Interbank rates that has seen a lot of the volatility”, Mr Ashigbey said.

He said much as the regulator, BoG and the government have a greater role to play, you have also been working with the Central bank and, therefore, you still cannot be passive”, he contended.

On ICT, Mr Ashigbey called on the banks to leverage ICT to transform the interbank market to make it more efficient and transparent.

“As we speed up the transformation onto an electronic platform, there is the need for real time information to take out the volatility that seems to characterize the foreign exchange market”, he advised.