Citi Business News has gathered that government is planning to merge the National Investment Bank (NIB) and the Agricultural Development Bank (adb) to form the National Development Bank announced in the 2018 Budget.
Finance Minister, Ken Ofori-Atta during the presentation of the 2018 Budget in parliament last Wednesday announced that government will launch a National Development Bank to focus on the Agricultural and Industry sectors.
Mr. Ken Ofori-Atta also stated that government is planning to launch the National Development Bank with a seed capital of 500 million US dollars.
Sources tell Citi Business News government intends to launch the bank in December or early 2018 to provide cheap credit to players in the agricultural and industry sectors of the economy.
The adb was formed to focus on investing in the agricultural sector but the bank has seen less investment into the sector.
The NIB has also struggled to fulfill its main responsibility of investing in the industry sector.
Meanwhile, Economist and Head of the Economics Department at the University of Ghana, Professor Peter Quartey has lauded government’s decision to launch a National Development Bank.
“The current system where adb, NIB are not giving the sectors the needed finance, we need to create a new bank that will serve that purpose. Ideally we should reform the existing ones but its proven difficult, therefore we need to create a new development bank that would be very focused, will have a special need, will have special focus to ensure that credit goes to agric and manufacturing and these are the two critical sectors of the economy that will create jobs for our youth,” he explained.
Prof. Quartey was of the view that the move will help address challenges of funding those sectors.
adb’s financial performance
As at the third quarter of 2017, adb had posted a profit before tax of 66,342,000 cedis. While profit after tax was 48,579,000 cedis.
This compares to the 964,000 cedis they recorded in the same period in 2016.
Of the bank’s income for the period, interest income comprising revenue from loans and advances accounted for 389, 6o4,000 cedis. This is up from the 250,802,000 cedis recorded in the same period in 2016.
By: Lawrence Segbefia/citibusinessnews.com/Ghana