Accra, June 15, GNA- Mr Ken Ofori-Atta, the Minister of Finance has indicated that the recently launched Development Bank of Ghana (DBG) has a total of $750 million resources available to the bank in equity and debt.
Those resources, he said, included equity commitment of $250m out of, which $200m had been paid and a German Kfw subordinated debt of €46.5m Euros that included an additional €3m grant for Technical Assistance.
“The World Bank and EIB have given the Bank $225m and 170m Euros respectively. AfDB have also given the Government $40m grant, which has been given to the Bank as equity,” he said.
Speaking at the launch of DBG, he urged the Board and Management of the Bank to work hard towards getting an international rating for the Bank within the shortest possible time.
“It is our firm expectation DBG will manage it affairs prudently, that soon it will be able to go to the market, both domestic and international, to raise its own funds on the basis of its balance sheet” he said.
The Minister said DBG would focus more on economic transformation, especially industrialisation and value-addition in agriculture while providing support to businesses in technology, tourism, and high value services.
He added that “the aim will be to focus on SMEs and relatively large Ghanaian corporates in these sectors to help transform the economy and create jobs.”
Mr Ofori-Atta hinted that the Bank would among other things provide long-term finance to economic units operating in the productive sectors of the economy at competitive interest rates, provide funding facilities with tenures of up to 15 years and lend funds to participating financial institutions for on-lending to SMEs.
He said DBG would also operate a Partial Guarantee Window and a digital platform to facilitate factoring of invoices by SMEs.
Mr Ernest Addison, the Governor of the Central Bank of Ghana (BOG) observed that the inability of Development Finance Institutions (DFIs) to effectively address market gaps, facilitate meaningful increases in financial intermediation had led to a resurgence in the establishment of new ones.
Overtime, the role of development banks, he said, had expanded to include finance for infrastructure expansion, environmentally green projects, as well as a wide range of developmental objectives.
“Despite these, DFIs maintain the provision of medium to long-term finance and project finance at the core of their activities,” he added.
He said there was broad international consensus that a strong regulatory and supervisory regime needed to underpin the operations of DFIs.
“This consensus was made following the observation that inadequate regulation and supervisory framework and undue political interference were major contributory factors that led to the collapse of development banks in Africa during the 1960-80.”
In that regard, he said that the Central Bank would subject the DBG to the same regulatory and supervisory standards that held banks and Specialised Deposit-taking Institutions (SDIs) in check while maintaining oversight on the Participating Financial Institutions (PFIs) that DBG would be working with.
“The Bank of Ghana will strive to work in close partnership with DBG to achieve this from two key angles. First, in helping to safeguard and protect DBG’s governance structures, and second, in working to create the right enabling environment both for DBG and its partners,” he said.
