Banking sector NPLs fall to GH¢19.9bn as asset quality improves

At the close of June 2026, the stock of non-performing loans (NPLs) in Ghana's banking sector had decreased to GH¢19.9 billion, marking a decline from GH¢20.7 billion the previous year. The Bank of Ghana reported a significant improvement in the industry's NPL ratio, which fell to 16.1% in June 2026 from 23.1% in June 2025. Even when fully accounting for provisioned loan loss, the NPL ratio diminished to 4.6% from 8.5% over the same period.

Private sector borrowers continued to be the primary source of non-performing loans, accounting for 98% of total NPLs in June 2026, up from 96.4% the prior year. Conversely, the public sector's contribution to NPLs dropped from 3.6% to 2%. The Bank of Ghana noted that the distribution of NPLs remained consistent with the credit exposures of the industry.

Despite the overall improvement, the NPL ratio for agriculture, forestry, and fishing sector worsened, escalating to 65.1% in June 2026 from 59.1% in June 2025. This decline in NPLs was attributed to enhanced loan recovery efforts and better credit risk management practices. A sustained reduction in NPLs may lead to a gradual decrease in credit costs, although the impact on interest rates might be minimal.