Information Minister, Kojo Oppugn Nkrumah says the Bank of Ghana (BoG) has announced provision of liquidity support to banks, savings and loan companies, and financial houses in the country.
The interventions, which are seen as complementary to the government's new spending packages, are an effort to keep money flowing despite the near-freeze on business activity as a result of the coronavirus pandemic.
Mr. Oppong Nkrumah stated that the pumping of liquidity into the financial system is meant to provide economic relief to households and businesses as well as increase credit to key sectors of the economy.
The Minister asserted that the move was in line with the activation of the Section 46A (1) of the BoG (Amendment) Act 2016 (Act 918) to provide emergency liquidity assistance.
According to the provision of the Act, the central bank, may, for the purpose of section 3(2) (c), provide liquidity assistance to banks, savings and loans companies and financial houses, which the Bank had determined to be illiquid but solvent.
The Minister intimated that the BoG intended to strengthen the capacity of ARB Apex Bank to provide liquidity support for rural and community banks facing temporary liquidity challenges in line with agreed framework.
“Microfinance companies who meet eligibility criteria agreed will also qualify for this support from ARB Apex Bank,” Kojo indicated in a post on Facebook.
Extend the deadline for SDIs (MFIs and RCBs) to meet new capital requirements to December 2021
Reduce the 8 percent primary reserve ratio for savings and loans companies, finance house companies, and rural and community banks to 6 percent, and the 10 percent primary reserve ratio for micro finance companies to 8 percent.