Kwamina Duker Development Bank of Ghana

Kwamina Duker, CEO, Development Bank of Ghana

The government-owned Development Bank of Ghana (DBG) was launched a year ago, largely to drive private sector development and with a focus on unlocking longer-term capital to SMEs which form the backbone of the economy. The bank was set up with the support of international partners across the world. We are in conversation with CEO Kwamina Duker (pictured below).

Bridging the longer-term fi nancing gap

What was the rationale behind launching the Development Bank of Ghana in 2021?

We were set up essentially to address a key market failure - which was a lack competitive rates.

What we don’t have in Ghana is an environment where banks have the capability to provide funds to allow entrepreneurs to properly grow their businesses.

The Bank of Ghana’s data provides represents only 5% of bank lending.

The government of Ghana together with growth of the private sector. With great entity to sort out that problem and that’s what they did.

cally at SMEs or at businesses in all sectors?

Our mandate is to provide loans for a three to 15-year period. We’re not just looking at

We are very much sector-specific at high-value services such as tourism.

Within that we have sub-sectors. Our whole lending process is very much data and value chain driven. We need to have market failures are in any value chain and make sure that we are bringing in funding to have the correct development outcome.

We have a development mandate so we won’t want to be funding sectors that are being serviced adequately.

domestic banks. Will there be criteria in terms

be capping the rates which they can lend at and the tenors as well?

is about being the catalyst for collaboration and sustainable change. We do not do anything that disrupts the market in the rate caps or any other distortions.

We need to build something that’s sustainable. We need to be able to make sure that we are working on deals that are ners that want to work with us rather than feel that they are forced to work with us. with our banks and we discuss with them to a large extent what a reasonable spread is over what we provide to them. Their support is critical. partners and partner banks to leverage our facilities to close this funding gap. steward leader. Our partners will have to commit to providing resources to follow you can bring down the high overheads of compliance.

Are you developing new instruments to work with the banks so as to de-risk certain sectors and to encourage lending to certain sectors?

Bank to set up a partial credit guarantee We are also very mindful that lending needs to be complemented by equity. This is why we are setting up a fund of funds business to be able to support businesses We are looking at the whole eco-system and trying to bring in tools that will support businesses across their growth cycle. The fundamental reason we are here is

‘Our whole DNA is about being the catalyst for collaboration and sustainable change.’

speaking the same language. nology allows you to codify relationships in a way that everybody can speak in the same language and understand what is required from each other. of Singapore and KfW to create a digital banks and also government.

There seems to be a big emphasis on Environ-

ards. Why are you putting a strong focus on this particular area?

terms of making sure that the loans that

Our founders and our stakeholders have bank was to make sure that the governance side is robust and world class. The G ensure that our model is sustainable.

How are you going to deploy your $850m balance sheet?

and a third is equity. We are set up as a wholesale bank to provide lending facili

Let me give you a couple of numbers to give you some indication of what we are of their assets are held in government currently being held in treasuries to the why hasn’t that happened previously? Because we need to de-risk the environment and that’s the work we are doing today.

And the typical size of the loans?

We’ve made our first loans totalling has been seven years and now that we’re a large pipeline of loans that we are working through.

We assume data will be key to your success?

There is too much work or money that has been wasted in the past without looking at data.

We think that it is essential and that is why we are building a data platform. truth that everybody can reference. This and the borrowing company data. We are the only institution with the convening power to develop and build on that for the

Our mandate is also to build capacity. That is why we are running workshops almost every week with the private sector literacy.

When people sign on for these loans they have to sign up on this platform and this becomes extremely valuable for fundamental to lending and making the be critical to our success.