UGBS FFA FINAL WORK.docx

Ghana stocks did not look attractive to investors as

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was battling with high public debts, post-election inflationary pressures and other external shocks. Ghana stocks did not look attractive to investors. As, the dividend yields look good over the period, the banks dividend payouts kept increasing. As mentioned earlier, the increasing cost of the bank’s operations also affected its dividend cover. This could partly explain why the banks reduced its dividend payouts despite the appreciable dividend yields on the market. 4 | P a g e
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Question 3 SOURCES OF FUNDS Category 2013(GH¢000) % of total fund 2015(GH¢000) % of total fund 2017(GH¢000) % of total fund Short-term Trade Creditors + Other Liabilities 224,35 9.00 18.77% 433,03 6.00 28.26% 675,821.00 41.73% Medium term RE + Deposits from Bank +Medium term Loans 606,28 8.00 50.72% 550,70 9.00 35.94% 513,670.00 31.72% Long-term Long-term Debts (Borrowings) +Equity 364,76 3.00 30.51% 548,61 7.00 35.80% 429,841.00 26.54% 1,195,410 .00 100% 1,532,362 .00 100% 1,619,332.00 100% s Question 4 SYSTEMATIC RISK UNSYSTEMATIC RISK Unpredictable economic growth trends Changes in regulation in the Banking industry The impact of public debt & taxation policy The new entrants (eg.south African Banks) into the Industry Post-election shocks & Gov't spending The overall perception of fraudulent reporting among the collapsed indigenous banks Recapitalization reforms The perceived political influence in the governing policies of the Central Bank Question 5 BUSINESS RISK FINANCIAL RISK Moral hazard problems: This occurs when someone increase Credit risk: The risk of default on a debt that may arise from a borrower failing to make 5 | P a g e
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their exposure to risk when insured, especially when a person takes more risks because someone else bears the cost of those risks. A moral hazard may occur where the actions of one party may change to the detriment of another after a financial transaction has taken place. required payments. Technological risk: Any potential for technological failures to disrupt your business such as information security incidents or service outages. Liquidity risk : The financial risk that for a certain period of time a given financial asset, security or commodity cannot be traded quickly enough in the market without impacting the market price. Litigation risk is the possibility that legal action will be taken because of an individual’s or corporation’s actions, inaction, products, services or other events. Interest rate risk: The risk that arises for bond owners from fluctuating interest. How much interest rate risk a bond has depends on how sensitive its price is to interest rate changes in the market. The sensitivity depends on two things, the bond’s time to maturity, and the coupon rate of the bond.
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  • Summer '16
  • EMMANUEL
  • EcoBank, Curr. Assets- Other Assets

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