[ 2016-04-28 ]

Bank charges up by 100%
Banks in the country have began charging almost
100 percent increase in tariffs for maintenance of
personal and corporate

current accounts as well as other charges,
Business Finder understands.

The financial intermediaries say the increases
have become necessary because of rising cost of
operations and increase in taxes.

Even though some banks are yet to implement new
charges, most of them have adjusted their tariffs
upwards in consonance with rising business costs.


This paper’s checks revealed that some banks
which used to charge GH¢5 for maintenance of
personal current accounts are now charging GH¢15
per month, and those which use to charge GH¢20
for corporate current accounts are now going for
about GH¢45 per month. These charges exclude
others such as cheque clearing and printing of
account statements.

Depending on the number of transactions for the
month the charges could go up as high as GH¢300.

The banks that effected the biggest increment are
mainly in the tier one and tier two categories.
However, some tier three and tier four banks have
also adjusted their tariffs up significantly.

According to the pwc 2014 Banking Survey, Eobank
Ghana, GCB, Stanchart, Stanbic, Barclays, Zenith
and Fidelity Bank made up of the tier one category
while the tier two banks are UBA, ADB, CAL, UT,
uniBank and NIB.

Other banks have also consolidated all their
charges including monthly account maintenance,
account statements, cheque clearing, interbank
transfers among others. This means that
irrespective of the number of transactions a
client does within a month, the same charges
apply.

In this regard, banks that used to charge GH¢5
for personal current account are now charging
about GH¢20 whilst those charging GH¢50 for
corporate current account are now charging about
GH¢250 per month.

This however excludes cheque book charges and
other levies.

Charges for loan processing and facility fees have
also been adjusted upwards slightly to make way
for increasing cost of capital.

Importantly, banks see fees and commissions as
very critical in their overall operating income.

For savings accounts, the average interest paid on
it is about 7.0 percent while some banks pay as
less as 4 percent interest.

With regard to time deposits, some banks pay as
less as 10 percent for one month tenor, 12 percent
for 60 days, 14 percent for 91 days and 16 percent
for 182-days. Others also pay as high as 13
percent for one month tenor, 15 percent for 60
days, 18 percent for 91 days and 20 percent for
182-days.

For loans, average lending rate is about 28
percent despite some base rates being quoted under
20 percent.

According to the 2015 Financial Stability Report,
banks made GH¢1.08 billion from fees and
commissions alone, about 22.0 percent growth over
the previous year.

Interest income constituted 51.5 percent of total
income in December 2015 compared with 45.5 percent
in December 2014.

Investment income share of 29.3 percent of total
income in December 2015 was marginally above the
29.2 percent recorded in December 2014.

However, the share of income from fees and
commission declined to 11.6 percent in December
2015 from 12.8 percent in December 2014.

Source - The Finder

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