Investment in treasury bills now constitutes banks largest investment portfolio the Bank of Ghana has revealed in its September 2023 Monetary Policy Report.
According to the report, the share of T-bills grew sharply to 51.0% in August 2023, from 17.8% in August 2022.
Instructively, the significant increase in the share of short-term investments can be attributable to limited trading on the medium-to-long term instruments because of the Domestic Debt Exchange Programme.
Consequently, the share of long-term securities in total investments, declined significantly to 48.8%, from 81.9% over the same reference period.
The share of equity investments remained negligible, moderating to 0.2% from 0.3% during the period under review.
Meanwhile, investments stood at ¢97.1 billion in August 2023, up by 19.9%, from the modest growth of 0.8% in August 2022, as banks continued to rebalance assets portfolio in favour of short-term investments, following the Domestic Debt Exchange Programme (DDEP) and revision of the Cash Reserve Ratio.
Similarly, banks’ short-term investments increased sharply by 242.6% in August 2023, after contracting by 38.2% in August 2022, while long-term investments (securities) recorded a contraction of 28.6% from a growth of 16.9% during the same reference period.
Consequently, the share of investments in total assets inched up marginally to 39.7% in August 2023, from 39.6% in August 2022.