Commerce and Finance sector tops secured credit recipients with 31.1% share in Q2 2023

In Q2 2023, according to the Bank of Ghana’s Collateral Registry Quarterly Brief, the Commerce and Finance sector received the largest share of secured credit at 31.1%.

This was followed by the Electricity, Gas, and Water sectors at 28.8%, with the Services sector trailing at 15.2%.

The Construction sector accounted for 7.5%, while the Transport and Haulage sector received 6.4%. The Manufacturing sector secured 4.4% of the loans.

In contrast, the Agriculture, Forestry, and Fishing sector received a minimal share of 1.6%, followed by the Mining and Quarrying sector at 1.5%.

Cottage Industries sector accounted for only 0.1%, and the Information and Communications sector received the smallest share at 0.02%.

During the same period, the share of secured loans granted by foreign-owned banks in Ghana declined from 55.4% in Q2 2022 to 43.9% in Q2 2023.

Conversely, domestic banks increased their share to 56.1% in Q2 2023, up from 44.6% in the previous year. Domestic banks played a pivotal role as the primary source of secured loans during this period.

Meanwhile, the average lending rates for secured loans varied across lending institutions.

Leasing Companies had the lowest average rate at 12.1 percent in Q2 2023, down from 14.7 percent in Q2 2022.

Banks recorded a rate of 26.9 percent in Q2 2023, up from 20.9 percent in Q2 2022, while Finance and Leasing Companies increased to 29.3 percent from 20.0 percent in the same period.

Rural and Community Banks (RCBs) saw an increase to 35.1 percent from 32.4 percent in Q2 2022. Savings and Loans (S&L) companies recorded a rate of 44.2 percent in Q2 2023, down from 45.2 percent in Q2 2022.

Finance Houses had the highest rate at 59.2 percent in Q2:2023, up from 49.5 percent in Q2:2022.