The Managing Director of GCB Bank PLC (GCB), Mr. Kofi Adomako, has indicated that the new Development Bank Ghana’s (DBG) arrival is timely for banks like GCB and also for the growth of Small and Medium-sized Enterprises (SME) in the country.
Mr. Adomako was speaking to the collaboration between GCB and DBG and stated: “DBG is actually not going to be a commercial bank or behave like one; rather, it is a wholesale bank and will typically on-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 which 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 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 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 that 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 that 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 assist SME clients. This dedicated support will 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 and reach out to SMEs. The reach we bring to this collaboration is immense. Also, GCB Bank has 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 the value we bring through technical expertise, managerial expertise and capacity building”.
The collaboration with DBG is expected to deliver several benefits aimed at improving the lot of SMEs. It will help share risk by channeling funds through it to GCB and 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 that will 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 will learn how to compete better internationally and thereby improve its export potential, leading to expansion and more jobs.
DBG will launch on 14th June. It is expected to begin making loan announcements in the very near future.