The Managing Director of GCB Bank PLC (GCB), Kofi Adomako, has indicated that the arrival of the new Development Bank Ghana (DBG) is timely for banks like GCB and also for the growth of Small and Medium-sized Enterprises (SMEs) in the country.
Mr. Adomako who was speaking on the collaboration between GCB and DBG, stated that “DBG is actually not going to be a commercial bank or behave like one; rather it is a wholesale bank and will typically lend, like many other development banks, to commercial banks to intervene in markets. DBG has come at the right time in a country like Ghana. It is true we have had other banks who tried to play the role of development banks but DBG comes with a big difference. The difference DBG brings is its independence, governance and the way it was set up.”
He explained that, “the development partners that DBG brings to the market are immense. I think the Bank has come at the right time and it is going to be a different bank from what we have seen in the past. DBG is not going to compete with commercial banks but it is going to bring out the value in commercial banks in the sense that it is going to on-lend over much longer terms, in both foreign currency and Cedis which commercial banks have lacked for a long time and has stifled the growth of SMEs. So, DBG coming into the market is timely for a bank like GCB Bank. We see them as a unique partner, who will help us deepen our focus in the market and help us develop those areas in agribusiness, ICT, tourism for which much needed funding is required.”
GCB has over the past 69 years built an extensive network which has enabled it to maintain the largest SME portfolio in Ghana. Through the bank’s over 184 branches and offices, it has provided dedicated support to the sector, significantly contributing to the country’s economic development. The Bank has a Call Centre which serves as a hub for its satellite branches across the country and this ensures a good engagement with SMEs. To make the collaboration with DBG beneficial to SMEs, the Bank will have dedicated officers in its branches who will assist SME clients. This dedicated support would also be available on the Bank’s electronic channels.
According to Mr. Adomako, “GCB Bank collaborating with DBG, is an opportunity to further take advantage of our wide branch network to reach out to SMEs. The reach we bring to this collaboration is immense. Also, GCB Bank has the expertise and experience in the SME sector and has the largest SME book in this country. It is therefore an excellent opportunity to work with DBG to deepen that arrangement in terms of skills, scope and in terms of the value we bring through technical expertise, through managerial expertise and through capacity building.”
The collaboration with DBG is expected to deliver several benefits all aimed at improving SMEs. It will help share risk by channeling funds through it to GCB and to the huge SME clientele of the commercial bank. It will also offer capacity building and technical support opportunities. Ultimately it will help GCB’s SME clients benefit from support which would position them favourably to compete on the African continent on the back of the African Continental Free Trade Area (AfCFTA) and also via other trade arrangements Ghana is a signatory to. Through this opportunity, the Bank believes that its SME clients would learn how to compete better internationally and thereby improve its export potential leading to expansion and more jobs.
DBG will be launched on 14th June. It is expected to begin making loan announcements in the very near future.