Agricultural Development Bank (ADB) Plc posted a record profit in 2025 and restored its capital base, but audited financial statements filed with the Ghana Stock Exchange (GSE) reveal a banking institution still carrying a severe non-performing loan burden that has quietly shrunk its lending activity even as its balance sheet swelled to GH¢17.89 billion.
The five-year financial summary in the full annual report tells a story that headline profit figures obscure. Net loans and advances to customers, the primary measure of a bank’s lending activity, fell from GH¢3.24 billion in 2022 to just GH¢2.01 billion by 31 December 2025, a 38 percent contraction over three years. This came even as total assets grew 22 percent in 2025 alone, driven overwhelmingly by a surge in cash holdings to GH¢9.90 billion and investment securities to GH¢5.03 billion rather than by lending to farms, businesses, or households.
The credit quality data within the full notes to the financial statements explains the loan book retreat. The Bank of Ghana (BoG) regulatory classification table in the report shows that of ADB’s total gross loan portfolio of GH¢5.00 billion as at 31 December 2025, GH¢3.52 billion, or approximately 70.4 percent, was classified as Loss, the most severe category under the central bank’s grading framework. This compares to GH¢2.84 billion in Loss-classified loans a year earlier. The total Bank of Ghana provision against these loss loans stood at GH¢2.41 billion at year-end.
The concentration of credit risk is equally stark. Of ADB’s gross loan book, corporate term loans alone accounted for GH¢2.19 billion, down from GH¢2.57 billion the prior year, while individual term loans stood at GH¢1.20 billion. Total gross loans contracted from GH¢4.23 billion in 2024 to GH¢3.89 billion in 2025, a further reduction of GH¢331 million in a year when many peer institutions were growing their lending.
The auditors, KPMG, signed off on the statements on 31 March 2026 without a qualification. The bank’s impairment loss on loans and advances during 2025 amounted to GH¢231.78 million, compared to GH¢302.92 million in 2024, suggesting some moderation in new provisioning requirements even as the legacy stock of bad loans remained enormous.
The bank’s strategic response to this problem has been to pivot heavily toward government securities and treasury instruments rather than private sector lending. Investment securities on the balance sheet rose from GH¢3.80 billion to GH¢5.03 billion between 2024 and 2025, and short-term treasury bills accounted for GH¢3.56 billion of the GH¢9.90 billion in cash and cash equivalents at year-end. This approach generated the GH¢2.09 billion in interest income that drove the dramatic improvement in net interest income to GH¢1.37 billion, but it represents a fundamental shift away from the bank’s founding mandate.
ADB was established to provide institutional credit to Ghana’s agricultural sector. The report notes that throughout 2025 the bank maintained 89 branches and agencies with a staff complement of 1,473, unchanged from 2024 in terms of network size. But a bank whose lending activity has contracted by more than a third over three years while parking the majority of its assets in government instruments is, at its core, operating as a government securities investor rather than a development lender.
Managing Director Edward Ato Sarpong, who was appointed on 6 February 2025, has framed the bank’s recovery under what he calls Project 135, a four-year strategy targeting a top-three ranking among Ghanaian banks. The Directors’ Report confirms the board does not recommend the payment of a dividend for 2025, with accumulated losses still standing at GH¢1.75 billion despite the year’s GH¢367.29 million profit.
Finance Minister Cassiel Ato Forson has pledged a government recapitalisation of ADB in 2026, a commitment that appears increasingly necessary given the scale of the legacy non-performing loan problem. With GH¢3.52 billion in loss-classified loans on the books and a net loan portfolio of only GH¢2.01 billion, the bank’s ability to fulfil its core agricultural development mandate without a substantial injection of fresh capital and a resolution of its bad debt stock remains in question.
