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ADB, NIB merger: Universal license makes banks lazy —Fmr. Dep. Finance Minister

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A Former Deputy Minister of Finance in the National Democratic Congress (NDC) government, Kweku Ricketts-Hagan, is calling wants the establishment of sector specific banks in Ghana

He said a sector specific banks deal with sensitive specific areas of the economy. He questioned why the current government is thinking of merging the Agric Development Bank (ADB) and the National Investment Bank (NIB).

Finance Minister Ken Ofori Atta, had earlier indicated plans to merge NIB and ADB to create a national development bank. He said this at a banking forum organised by the Danquah Institute in Accra.

In an interview, the former Deputy Minister of Finance, said one thing he would want to see change in this country is the establishment of universal licensed banks, “it makes banks lazy”, he said.

He defended his point by saying if you are a sector specific bank like ADB you have taken a universal license, it is easier to lend money to people who are clearing goods from the port and make good returns, why would you give it to a farmer who is going to spend eight months to grow food.

We set up the Agric Development Bank for a purpose to be able to develop the agriculture sector, therefore there should be an incentive for the bank to want to lend to farmers, but not create a disincentive for them to go and lend somewhere else.

ADB is as good as it is, big enough to support the Agriculture sector. You want to put them together and create what, what  is the focus of that bank if it is in terms of giving them the muscle ADB is big enough, if you want to pump more money into it let them do more flotation and get them bigger.

Source: Kwaku Sakyi-Danso

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