Total deposits in the banking industry dropped to GHC40.3 billion at the end of January 2016, according to the latest Summary of Economic and Financial data by the Bank of Ghana (BoG).

This is compared with GHC41.26 billion at the end of December 2015, indicating that about GHC960 million was lost from the banking sector in the first month of 2016.

According to the report, total assets of the banking industry stood at GHC63.0 billion in January 2016 compared with GHC63.4 billion in December 2015.

The domestic assets component of total assets increased by 24.1 percent to GHC57.98 billion at the end of December 2015 compared with 39.9 percent growth recorded for the same period in 2014.

Growth in foreign assets also slowed down from the 69.4 percent recorded in December 2014 to 12.5 percent growth in December 2015
Loans and advances however went up by 25 percent to GHC30.2 billion compared with GHC30.1 percent in December last year.

Demand Deposits, largely current and savings accounts grew by 31 percent at the end of January 2016.

According to the report, the figure was 10.3 percent higher than the December 2015 numbers, indicating that more funds have been placed in current account in the first month of the election year.

Savings and Time Deposits popularly called fixed deposits however recorded a 32.6 percent growth in January 2016 compared with 34.8 percent in December 2015.

Growth of currency outside banks however declined from 23.3 percent at the end of last year to 20.5 percent in January 2016.

According to the report, liquidity in the banking industry grew by 29.6 percent in the first month of this year, higher than the 28.7 percent growth recorded in December 2015. Liquidity growth had declined from 34.9 percent in June 2015 till December last year.

The banking industry’s capital adequacy ratio also stood at 17.9 percent in January 2015 as against 17.8 percent in December 2015.

The BoG said in its Financial Stability Report that Ghana’s banking sector continued to be sound and solvent as evidenced by key financial soundness indicators, though there has been some deterioration in asset quality and efficiency.

It added that the Ghanaian banking industry’s performance is expected to pick up with the improvement in the energy supply; on-going fiscal consolidation reflected in the lower Treasury bill rates; and relative stability in the exchange rate.

About seven tier one banks control about 44 percent of the Ghanaian banking industry’s market share.