The Bank of Ghana expects the banking sector’s non-performing loans (NPLs) ratio to decline further as new regulatory and prudential measures begin taking effect, Governor Dr Johnson Pandit Asiama has disclosed.
Speaking after the 130th Monetary Policy Committee meeting in Accra, Dr Asiama said recent supervisory interventions and tighter banking regulations are already improving credit administration and strengthening the balance sheets of commercial banks.
According to him, the central bank remains focused on preserving financial-sector stability while ensuring banks maintain stronger risk-management and lending standards.
“We expect that the non-performing loans ratio will go down further for commercial banks due to some of the guidelines that have been put in place,” he stated.
The Governor noted that despite economic pressures experienced in recent years, Ghana’s banking sector remains broadly stable, liquid and well-capitalised. He added that the Bank of Ghana will continue enforcing strict compliance with prudential regulations to safeguard the financial system.
Latest Bank of Ghana data show that the industry’s NPL ratio fell to 18.0 per cent in April 2026, down from 23.6 per cent recorded in April 2025. Excluding the loss category, NPLs declined to 5.6 per cent from 9.0 per cent over the same period, reflecting gradual improvement in asset quality across the sector.
The banking industry has also recorded growth in key financial indicators. Total banking-sector assets increased to GH¢493.9 billion in April 2026 from GH¢390.1 billion a year earlier, while deposits rose to GH¢365.5 billion from GH¢289.5 billion. Total advances also climbed to GH¢115.2 billion, representing annual growth of 25 per cent.
Capital buffers have strengthened significantly, with the sector’s capital adequacy ratio improving to 22.3 per cent in April 2026 compared with 17.5 per cent a year earlier. This suggests banks are in a stronger position to absorb potential credit shocks while supporting lending activities.
Dr Asiama indicated that tighter credit underwriting standards, improved risk management and enhanced supervision are expected to further reduce bad loans in the coming months.
His comments come shortly after the Bank of Ghana announced changes to the Cash Reserve Ratio framework. The central bank has replaced the dynamic CRR system with a uniform 20 per cent reserve requirement to be maintained in domestic currency, effective June 4, 2026.
The new reserve framework is expected to simplify liquidity management and improve predictability within the banking sector. It also provides the central bank with an additional tool to control liquidity conditions while maintaining financial stability.
The policy shift comes at a time when interest rates are declining sharply. The policy rate stood at 14.0 per cent in April 2026, down from 28.0 per cent a year earlier, while the average lending rate dropped to 16.33 per cent from 27.40 per cent. The 91-day Treasury bill rate also declined to 4.90 per cent from 15.47 per cent over the same period.
Private-sector credit growth is also recovering steadily. Nominal private-sector credit expanded by 28.7 per cent year-on-year in April 2026, while real private-sector credit grew by 24.5 per cent, signalling improving credit conditions as inflation and borrowing costs ease.
However, analysts say the challenge for the central bank will be balancing stronger liquidity controls with the need to sustain credit growth to businesses and households.
For commercial banks, the message from the Bank of Ghana remains clear: expansion in lending must be matched with stronger credit discipline and prudent risk management. While the sector has become healthier compared with a year ago, the NPL ratio remains relatively high, meaning the recovery in asset quality is still ongoing.
