The Collateral Registry of the Bank of Ghana has reported a notable surge in registrations, searches, and discharges in the second quarter of 2024, reflecting a broader economic recovery and increasing confidence in the financial sector.
The collateral registry is a body established by parliament under the Borrowers and Lenders Act,2008(Act773) to principally register charges and collaterals created by borrowers to secure loans and other credit facilities provided by lenders. When people or institutions borrow from licenced financial institutions, details of the loan and collateral used in securing the loan are captured in the Collateral Registry.
According to the latest quarterly brief, the total number of registrations recorded at the Collateral Registry reached 80,873 in Q2 2024, marking a 59.5% increase compared to the 50,695 registrations in the same period last year. This growth was predominantly driven by Savings and Loans Companies (S&Ls), which saw a 74.2% rise in registrations, from 39,796 in Q2 2023 to 69,328 in Q2 2024.
The upward trend was not limited to registrations alone. The number of searches conducted at the registry also grew by 10.1% year-on-year, from 14,184 in Q2 2023 to 15,617 in Q2 2024. Again, Savings and Loans Companies led the way, accounting for 74.1% of the total searches during the period, followed by Rural and Community Banks (RCBs) at 17.6%.
A sharp rise in the discharge of collateral registrations, soared by 210.2% year-on-year, from 11,621 discharges in Q2 2023 to 36,048 in Q2 2024. This surge was primarily due to loan repayments, with Savings and Loans Companies recording the highest number of discharges, totaling 29,333 and representing 81.4% of all discharges.
The total value of secured loans registered by banks and Specialized Deposit-taking Institutions (SDIs) also saw significant growth, increasing by 83.1% from GHS 5.9 billion in Q2 2023 to GHS 10.8 billion in Q2 2024. Banks were the dominant lenders, contributing GHS 9.1 billion of this total, a rise of 85.7% year-on-year. SDIs followed with GHS 1.7 billion, marking a 75.1% increase from the same period last year.
Gender analysis of secured loans revealed that individual male borrowers and businesses owned by males accounted for the majority share of the total value of secured loans, which increased by 122.7% from GHS 2.2 billion in Q2 2023 to GHS 4.9 billion in Q2 2024. In contrast, loans to individual female borrowers and businesses owned by females rose by 42.6% to GHS 1.1 billion.
Foreign-owned banks emerged as the key players in the lending landscape, with their share of the total value of secured loans increasing to 64.3% in Q2 2024, up from 43.9% in Q2 2023.
In terms of collateral, movable assets dominated the registry, accounting for 81.2% of the 106,352 assets registered in Q2 2024. Cash collateral was the most common type of security, with 72,768 registrations.
