Ghana’s banking sector wrote off GH¢1.64 billion in bad debt last year, a reduction of 57.1 percent compared with the GH¢3.82 billion written off in 2024, new central bank data shows, as lenders pressed ahead with balance sheet clean-ups ahead of a tightening regulatory deadline.
The Bank of Ghana’s (BoG) January 2026 Banking Developments Report showed that the industry’s Non-Performing Loan (NPL) ratio fell to 18.9 percent in December 2025, from 21.8 percent a year earlier, although asset quality risks across the sector remained elevated. The NPL ratio adjusted for fully provisioned loans also improved, declining from 8.5 percent to 5.0 percent over the same period.
Despite the ratio improvement, the absolute stock of bad loans grew. The total NPL stock increased by 0.8 percent to GH¢21.0 billion in December 2025, a marked slowdown from the 31.4 percent growth recorded in December 2024, reflecting tighter lending standards and stronger recovery efforts across the sector.
The private sector continues to dominate the bad loan pile. According to the central bank, the proportion of NPLs attributable to private borrowers rose to 97.5 percent in December 2025 from 96.2 percent the previous year, while the public sector’s share shrank from 3.8 percent to 2.5 percent, consistent with its smaller share of total credit.
Asset quality improvements were recorded across most sectors during the review period, with two notable exceptions. NPL ratios in the construction sector worsened from 29.8 percent to 30.7 percent, while the agriculture, forestry and fishing sector deteriorated sharply, rising from 38.0 percent to 46.3 percent. Analysts have previously linked the construction sector’s persistent stress to outstanding government arrears owed to contractors.
The data arrives as Ghana’s banks face a hard deadline to get their houses in order. The BoG has mandated all regulated financial institutions to bring their NPL ratios to 10 percent or below by December 2026, with banks exceeding 15 percent barred immediately from paying dividends or bonuses once the rule takes full effect.
BoG Governor Dr Johnson Pandit Asiama, speaking at the 128th Monetary Policy Committee press conference in January, acknowledged the improvement but said the 18.9 percent ratio remained too high. He said ongoing policy measures targeting legacy loans, stricter credit underwriting and action against wilful defaulters are expected to drive further improvement through the year.
