Development Bank Ghana secures $70m to establish partial credit guarantee subsidiary
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Loading... - Roseline Ampofo
- 18 Apr 2023
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Development Bank Ghana (DBG) has secured $70 million to implement a Partial Credit Guarantee scheme to help banks and financial institutions to adequately assess and manage risk.
The World Bank is offering $50 million while KfW will provide $20 million for the establishment of the Partial Credit Guarantee (PCG) subsidiary of the Bank.
The Chief Executive Officer (CEO) of DBG, Kwamina Duker announced this at the DBG and Ghana Association of Banks programme on Ghana’s Medium-Term Outlook in Accra on the theme: “Ghana’s Medium-Term Outlook, Navigating through Economic Uncertainties and an IMF Programme.”
“We are excited to announce that the Partial Credit Guarantee subsidiary is scheduled to commence operations in the third quarter of the year. This timely launch will provide our Partner Financial Institutions with an additional layer of support, allowing them to better manage risks associated with loan defaults while continuing to serve the Small and Medium Enterprises sector effectively,” Mr Duker said.
Speaking on the topic “The Role of DBG, Working Together to Resuscitate the Country’s Economy,” Mr Duker said macroeconomic uncertainty was one of the major challenges facing the banking and financial industry.
He said the prevailing macroeconomic conditions such as high inflation, currency depreciation, and fiscal constraints, had created an uncertain business environment, compelling banks to take a more cautious approach to lending and affected the ability of Small and Medium Enterprises (SMEs) to access credit and plan for growth.
“We are determined to address these challenges and build on the strong momentum generated in the first quarter, with a particular focus on expanding our lending portfolio, strengthening relationships with our PFIs and promoting sustainable development,” he said.
He said DBG had budgeted to disburse at least GH¢600 million in loans for on-lending to SMEs this year. Read More…
