Heads of Banks during the Post MPC meeting
The Governor of the Bank of Ghana (BoG), Dr. Johnson Asiama, has urged banks to shift from short-term resilience to long-term structural reforms in order to safeguard the durability of the financial system following the restoration of macroeconomic stability.
Speaking at the post-Monetary Policy Committee engagement with heads of banks, Dr. Asiama said durability requires stronger business models and broader ownership, alongside deeper intermediation, disciplined innovation, and sound governance.
“Stability has been restored. The task now is durability. Durability requires stronger business models, broader ownership, deeper intermediation, disciplined innovation, and sound governance. The Bank of Ghana will continue to engage as a firm, fair, and forward-looking partner, and supportive where necessary, but clear in its expectations,” he stated.
He assured the banking industry of the central bank’s continued partnership but emphasised that expectations remain clear, noting that with macroeconomic stability improving and regulatory reliefs now behind the sector, attention must turn to strengthening the foundations of the banking industry.
“With macroeconomic stability improving and regulatory reliefs now behind us, the conversation must shift from resilience to structure. The task ahead is to strengthen the underlying architecture of the banking sector,” he stated.
Providing an overview of the broader economic environment, the Governor said global growth in 2025 proved more resilient than expected, supported by easing inflation and improving real incomes, with 2026 projected to see steady, though uneven, growth.
These trends, he noted, offer a more supportive external backdrop for emerging economies such as Ghana, as real GDP expanded by 6.1 percent in the first three quarters of 2025, driven largely by services and agriculture.
Dr. Asiama also indicated that the disinflation process had been broad-based, supported by tight monetary policy, fiscal consolidation, and exchange rate appreciation, with inflation expectations remaining well anchored.
The Governor, however, cautioned that structural vulnerabilities remain within the banking sector, with loans accounting for less than one-fifth of total industry assets, while financial asset concentration in sovereign and central bank instruments remains elevated.
He added that approximately 68 percent of industry profitability is driven by net interest income.
He therefore urged banks to diversify their income streams as interest margins compress in a normalising rate environment, particularly through transactional banking, trade services, payments, treasury activities, and other fee-based income sources that are less balance-sheet intensive.
While non-performing loans have declined, he said they remain above benchmark levels. As credit expansion resumes, underwriting discipline and sectoral risk assessment will be critical.
Stability, he stressed, must now translate into purposeful intermediation, supporting agriculture, manufacturing, SMEs, and value-adding sectors without reintroducing asset quality pressures.
By Ebenezer K. Amponsah