Dr. Maxwell Opoku-Afari, the Bank of Ghana's (BoG) First Deputy Governor, has credited the central bank's financial sector reforms for the robust banking sector. He claimed that the industry has since remained profitable, liquid, and well-capitalized.
"The Capital Adequacy Ratio, the industry's gauge of solvency, has continued to be substantially over the increased statutory prudential ceiling of 13 percent. At a Financial Literacy training for journalists in Ghana's Northern Zone, he claimed that asset quality had also slightly improved.
We cannot discuss all of these without evaluating the soundness of the banking sector, which is essential for growth and whose stability should not be taken for granted, he said the journalists.
The thorough financial sector changes that were implemented before the Covid-19 pandemic hit in 2020 may be responsible for the banking system's exceptional resiliency over the two-year timeframe. Since then, the industry has remained profitable, liquid, and well-capitalized.
The Capital Adequacy Ratio, the industry's indicator of solvency, has remained significantly higher than the new regulatory prudential ceiling of 13 percent. Even still, asset quality has increased just somewhat.
Regarding the role financial and business journalists can play in sustaining the economic recovery through confidence building, he said it is widely known that the economic and financial environment, which is mainly defined by the media, has an impact on how economic agents behave.
"During times of increased uncertainty, when fake news of all types is rampant on social media and occasionally even in mainstream media, the media's role in influencing the economic narrative is even more crucial. The public could become panicked as a result of the propagation of such false information, which would have catastrophic effects for financial stability.
In these situations, business and financial journalists have additional duties to assist the public and participants in the financial markets in making a clear distinction between fact and fiction and determining the newsworthiness of the available information for accurate reporting, an essential component of fostering confidence.
"Business and financial journalists need to develop the analytical skills required to understand the complex relationships between financial and economic variables. This goes beyond overcoming personal biases."
I firmly believe that workshops like these may assist journalists like you gain the necessary understanding of the financial sector, as well as the kind of dangers and incentives the sector faces.
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