Banks’ sustainable success will be defined less by interest margins – PwC

PwC's latest banking survey in Ghana suggests that future success for the country's banks will be determined by strategic focus and business model reinvention, rather than solely by interest margins. The professional services firm warns that navigating a lower-rate environment while maintaining existing business models is no longer enough.

Banks must deliberately reposition themselves, prioritizing where they can excel, investing in capabilities that support their chosen strategies, and developing revenue-generating models that transcend the interest-rate cycle.

The survey reveals that Ghana's banking sector is currently thriving under an increasingly favorable macroeconomic environment. In 2025, inflation is easing, exchange rates are stable, economic growth is robust, and fiscal conditions are improving. This supportive backdrop has resulted in strong balance sheet growth, improved liquidity, and sustained profitability for the industry.

Asset growth has been fueled by continued deposit accumulation, increased allocation to debt securities, and expanded lending activity. Earnings have remained impressive, driven by enhanced core banking revenues, higher trading income, and growth in fees and commissions.

Despite these positive indicators, PwC cautions that the outlook for earnings is becoming more challenging. Lower interest rates are gradually eroding the margins currently enjoyed by banks and diminishing the benefits previously derived from a high-yield environment. As a result, banks must adapt by strategically focusing on their core purposes and values, choosing the right business models, and reinventing their operations to thrive in the evolving financial landscape.