The Governor of the Bank of Ghana, Johnson Asiama, has announced an ambitious plan to reduce the banking sector’s Non-Performing Loan ratio to 10 per cent by the end of 2026.
The target represents a sharp improvement from the current NPL level of 19.5 per cent recorded in October 2025 and signals a renewed push to consolidate financial sector stability following years of economic turbulence.
Dr Asiama made the disclosure during a speech delivered at the Governor’s Day Annual Bankers’ Dinner organised by the Chartered Institute of Bankers. He described the NPL reduction target as a central pillar of the Bank of Ghana’s broader strategy to ensure that asset quality remains a top priority for commercial banks, particularly as interest rates begin to ease.
According to the Governor, the improving macroeconomic environment provides banks with the opportunity to undertake intelligent loan restructuring without undermining prudential standards or exposing balance sheets to renewed risk.
Stability Restored, Focus Shifts to Productive Use
Reflecting on the broader economic outlook, Dr Asiama stressed that Ghana has moved beyond the phase of crisis management and is now entering a period where restored stability must be put to effective use. “As we turn toward 2026, the central question is no longer whether stability can be restored. The question is how that stability is used,” he stated.
“If 2025 was the year confidence was rebuilt, then 2026 must be the year that confidence is put to work carefully, productively, and with judgment in service of a stronger, more competitive Ghanaian economy.”
The Governor’s remarks underscore a clear shift in policy tone, from defensive stabilisation to forward-looking growth, with banks expected to play a more proactive role in supporting productive sectors of the economy.
Banks Called to Support Ghana’s Export Agenda
Beyond asset quality, Dr Asiama urged commercial banks to deepen their engagement with Ghana’s export strategy as the country prepares for the 2026 economic year. He called on banks to strengthen their export finance desks, support agro-processing and non-traditional exports, and actively explore trade opportunities under the African Continental Free Trade Area.
He emphasised that banks must take a more deliberate role in financing export-oriented enterprises, managing trade risks, and helping firms transition from domestic markets into regional and global value chains.
“The banking sector must not sit on the sidelines of Ghana’s export agenda but help shape it,” Dr Asiama said. He encouraged lenders to design export-ready loan products, build sector-specific expertise, support risk-sharing and hedging instruments, invest in digital trade platforms, and accompany exporters from production through to payment.
“When banks nurture exporters, they are not doing charity; they are expanding the country’s foreign exchange base, strengthening their own balance sheets, and deepening the resilience of the financial system.”
2025 Reforms Lay the Foundation for Confidence
Looking back on 2025, the Governor described the year as one marked by difficult but necessary policy decisions whose effects extended far beyond their immediate implementation. “As the year 2025 draws to a close, I find myself, like many of you, taking a moment to breathe out,” he said.
Dr Asiama recalled that when he assumed office earlier in the year, the challenge confronting the central bank was not a shortage of policy tools, but a deep erosion of confidence in policy signals, coordination, and consistency. He explained that market behaviour at the time reflected uncertainty rather than conviction, limiting the effectiveness of even well-intentioned interventions.
The Governor highlighted several reforms undertaken in 2025 that helped restore monetary and market discipline. These measures, he said, were instrumental in stabilising the cedi and slowing inflation sharply.
Inflation, which stood above 23 per cent at the beginning of the year, declined steadily into single digits by November, reaching levels not seen since 2019. Over the same period, the cedi appreciated cumulatively by more than 20 per cent. “Over the same period, the cedi appreciated cumulatively by over 20 per cent, reflecting a return of order rather than speculation,” Dr Asiama stated.
He added that sustained disinflation created the conditions for the Monetary Policy Committee to reduce the policy rate by a cumulative 1,000 basis points over the course of the year, an outcome he described as unimaginable without firm policy discipline.
Banking Sector Recovery and Future Outlook
Dr Asiama noted that reforms extended beyond monetary policy to the commercial banking sector, which entered 2025 still burdened by the effects of the Domestic Debt Exchange Programme and capital adequacy pressures.
As of the end of 2024, eleven banks recorded capital ratios below the prudential threshold. By November 2025, that number had declined to five, reflecting recapitalisation efforts, tighter supervision, and improving macroeconomic conditions.
Looking ahead, the Governor revealed that the Bank of Ghana is laying the groundwork for the next phase of financial sector growth. Significant progress has been made in modernising the payments ecosystem, including the completion of the National Payment Systems Strategy for 2025 to 2029, which outlines a coordinated roadmap for interoperability, cybersecurity, instant payments, and infrastructure modernisation.
Together, these initiatives, alongside the ambitious NPL reduction target, signal a renewed determination by the central bank to position Ghana’s financial system for long-term resilience, competitiveness, and sustainable growth.
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