The Governor of the Bank of Ghana, Dr. Johnson Asiama, says banks in Ghana now have a clear roadmap to reduce non-performing loans (NPLs) to about 10% by the end of 2026.
According to him, recent regulatory measures and policy reforms introduced by the central bank will help financial institutions improve asset quality and manage credit risk more effectively.
Roadmap to Reduce Bad Loans in Ghana’s Banking Sector
Dr Asiama explained that the new framework provides a structured approach for banks to deal with problem loans, including mechanisms for restructuring distressed assets and improving credit discipline.
He noted that reducing NPLs is critical to strengthening the banking sector and restoring confidence in the financial system.
The Bank of Ghana has therefore encouraged banks to take proactive steps to clean up their balance sheets and adopt stronger credit risk management practices.
Asset Management Company to Help Tackle NPLs
Part of the strategy involves banks selling certain bad loans to an Asset Management Company (AMC) to help reduce the overall NPL burden within the sector.
Dr Asiama said such measures will help financial institutions free up capital and focus on lending to productive sectors of the economy.
Targeting a Stronger and More Stable Banking Industry
The central bank’s plan forms part of broader reforms aimed at strengthening Ghana’s financial system following recent economic challenges.
The Bank of Ghana is targeting an NPL ratio of around 10% by December 2026, a move expected to enhance the resilience and stability of the banking industry.
Officials believe achieving this target will improve credit conditions, support economic growth, and position Ghana’s banking sector for long-term sustainability.
