Business News of Friday, 6 August 2021Source: www.ghanaweb.comThe International Monetary Fund has expressed concern over government’s high-risk exposure of borrowing Treasury bills and bonds, which have been increasing the balance sheet risk of banks. According to the Bretton Woods institution, the high-risk exposure is therefore crowding out the private sector’s resolve to lend. In a recent Article IV Consultation paper issued on Ghana, the IMF explained, “government lending supported the banking sector through the pandemic, but is crowding out private-sector credit and increasing balance sheet risks”. The IMF adds that government’s share of lending to total assets has hit 44.7 percent in February this year from an earlier 36.5 percent recorded the previous year. This was however driven by large budget deficit as well as risks to credit and demand as a result of the coronavirus pandemic.
