Banking sector faces fresh risk if cedi starts sliding again, Dr Atuahene says

Ghana's banking sector could face significant challenges if the cedi begins to depreciate once more, according to Dr. Richmond Atuahene, a banking and corporate governance consultant. This warning comes in the wake of a remarkable turnaround in the financial performance of state-owned enterprises (SOEs) in 2025. The State Interests and Governance Authority's (SIGA) 2025 State Ownership Report revealed that SOEs reported a net profit after tax of GH¢19.80 billion, a stark contrast to the GH¢2.25 billion loss incurred in 2024. Revenue also saw a substantial increase, climbing from GH¢137.64 billion to GH¢176.43 billion.

However, critics argue that these figures should not be hastily interpreted as evidence of operational efficiency. Dr. Atuahene highlights that the substantial improvement can largely be attributed to foreign exchange gains, which constitute 60% of the total profit. He cautions that such gains do not necessarily indicate efficient operations and questions whether profitability should be solely measured by financial statements.

He points out that some SOEs continue to struggle to provide fundamental public services, such as electricity and water, thereby raising concerns about the true measure of their performance.

The SIGA report attributes a 42.49% reduction in SOEs' finance costs to the favorable exchange rate. The entities also recorded net foreign exchange earnings of GH¢11.72 billion in 2025, compared to a foreign exchange loss of GH¢12.01 billion in 2024. Nonetheless, Dr. Atuahene expresses concerns about the magnitude of debt accumulated by state enterprises, which stands at GH¢282 billion.

He notes that SOE liabilities account for about GH¢282 billion of the wider debt burden, which he considers a cause for concern given the country's overall debt overhang of over GH¢700 billion.

Dr. Atuahene emphasizes the urgency of addressing SOE reforms, particularly in light of IMF requirements. He argues that the government must prioritize SOE reforms as part of the IMF's Poverty Reduction and Growth Trust (PRGT) program. He warns that if these underlying problems in state enterprises persist, they could eventually pose a broader threat to the Ghanaian economy.

Dr. Atuahene questions the measurement of profitability solely based on financial statements, given the ongoing struggle of SOEs to deliver basic public services to the population. He stresses the need to rethink the metrics used to evaluate the performance of these institutions.