Papua New Guinea’s banking sector experienced a mixed year in 2017, with commercial bank assets declining after four consecutive years of growth. Total loans to the private sector also fell against a backdrop of subdued economic activity, even as Bank South Pacific, the country’s leading commercial bank, recorded a strong rise in lending and increased profits. Nevertheless, efforts are under way to overcome these challenges, with a focus on modernising existing infrastructure and improving financial inclusion. Under a far-reaching sectoral review, launched with support from the World Bank, the Bank of PNG – the country’s central bank – has made steady progress in upgrading the country’s interbank transfer network to support the development of a national payment system.
This chapter contains interviews with Loi Bakani, Governor, Bank of PNG; and Robin Fleming, Group CEO, Bank South Pacific.