Private sector credit growth rebound - BoG Governor

Bank of Ghana Governor Dr Johnson Pandit Asiama reported that reserve money surged by 29.7 percent year-on-year in August 2026, compared to the slower 4.5 percent growth in August 2025. This growth was driven by net domestic assets expanding due to policy changes affecting reserve requirements. However, net foreign assets declined, helping to temper the overall increase in reserve money.

Broad money supply expanded by 20.4 percent year-on-year in August 2026, up from 16.6 percent a year earlier. The 91-day Treasury bill rate dropped to 5.4 percent from 10.3 percent, while the average lending rate for the banking sector fell to 15.9 percent from 24.2 percent over the same period.

The low-interest rate environment, coupled with a more lenient credit stance by banks and increased credit demand, fueled higher credit growth in the sector. Private sector credit rebounded to 35.5 percent in August 2026, up from 13.3 percent a year earlier. In real terms, this growth amounted to 29.0 percent, compared to 1.7 percent over the same period.

Dr Asiama affirmed that the banking sector remains solvent, profitable, and liquid, with improving asset quality. Total banking sector assets grew by 20.5 percent year-on-year to GH¢500.2 billion in August 2026, thanks to strong deposit mobilization and increased funding sources. The Capital Adequacy Ratio rose to 19.1 percent in August 2026 from 18.3 percent in August 2025.

The NonPerforming Loan (NPL) ratio also declined to 15.7 percent from 20.8 percent, aided by the robust credit growth rebound. Despite these improvements, credit risk remained elevated, emphasizing the need for banks to adhere to NPL guidelines to maintain financial system confidence.