Ghana’s banking industry must move beyond preserving financial stability and begin actively driving economic transformation by channeling capital into productive sectors, supporting exporters and helping businesses expand, Governor of the Bank of Ghana, Dr. Johnson Pandit Asiama, has said.
Addressing chief executives and heads of banks at a post-Monetary Policy Committee (MPC) engagement in Accra, Dr. Asiama said the improving macroeconomic environment presents a unique opportunity for banks to play a more strategic role in translating economic stability into broad-based prosperity.
His remarks come as Ghana records stronger economic growth, declining inflation, improving fiscal performance and a healthier banking sector, creating conditions that could support increased lending and private sector expansion.
“The challenge before us is not merely to preserve stability, but to transform stability into prosperity,” Dr. Asiama said.
He urged financial institutions to leverage lower interest rates, advances in financial technology and improving economic conditions to develop innovative products tailored to the changing needs of households and businesses.
From Stability to Economic Expansion
According to the Governor, the long-term health of the banking sector is inseparable from the performance of the real economy.
He noted that sustainable growth in manufacturing, agriculture, services and export-oriented businesses is essential for generating quality credit demand, reducing lending risks and creating jobs.
“As we sustain stable macroeconomic conditions, the banking industry must increasingly turn its attention to its fundamental role of financial intermediation and support for productive economic activity,” he said.
Rather than limiting their role to providing loans, Dr. Asiama encouraged banks to position themselves as strategic partners to businesses by offering advisory services, supporting entrepreneurship and helping firms identify export opportunities.
He proposed the establishment of export-focused support programmes and “export clinics” that would enable businesses to tap into markets where banks’ parent companies, subsidiaries and international partners already operate.
The Governor argued that such interventions would not only improve business competitiveness but also strengthen Ghana’s export base and deepen regional economic integration.
Economy Shows Strong Momentum
The Governor’s call comes against the backdrop of a significantly improved economic environment.
The Bank of Ghana’s Composite Index of Economic Activity expanded by 12.6 per cent in March 2026, compared with 2.3 per cent during the same period last year, driven by stronger private sector credit growth, industrial activity, trade and consumption.
Inflation has also remained under control despite recent marginal increases. Headline inflation rose from 3.2 per cent in March to 3.7 per cent in May 2026, while underlying inflationary pressures continued to ease as reflected in declining core inflation.
Fiscal performance has equally improved, with government recording a fiscal surplus of 0.1 per cent of GDP during the first quarter of 2026, exceeding programme expectations.
The external sector remains robust. Ghana posted a current account surplus of US$3.1 billion in the first quarter, supported by strong gold and cocoa exports and stable remittance inflows. Gross International Reserves increased to US$14.4 billion, providing 5.7 months of import cover.
Banking Sector Strengthens
Dr. Asiama highlighted significant improvements within the banking industry itself.
Total banking sector assets increased by 26.6 per cent to GH¢493.9 billion, while the industry’s Capital Adequacy Ratio rose sharply to 22.3 per cent from 17.5 per cent a year earlier.
Asset quality has also improved, with the Non-Performing Loan (NPL) ratio declining from 23.6 per cent to 18.0 per cent.
The Governor described the developments as evidence of the resilience of Ghana’s banking system and the impact of reforms undertaken over recent years.
However, he cautioned banks against complacency, warning that credit risks remain elevated.
He urged institutions to strengthen underwriting standards, improve loan recovery processes and continue efforts to reduce bad loans to prudent levels.
Turning Remittances into Investment
One area where the Bank of Ghana sees significant untapped potential is remittance mobilisation.
Dr. Asiama disclosed that the central bank would work with banks and other stakeholders to develop investment-linked remittance products capable of converting a larger share of remittance inflows into productive investments.
The initiative aims to channel remittance resources into business expansion, infrastructure financing and long-term capital formation rather than consumption alone.
According to him, this approach could deepen financial markets, strengthen economic resilience and create new sources of investment capital for the economy.
Regulatory Reforms and Emerging Risks
The Governor also outlined ongoing regulatory reforms designed to strengthen the resilience of the financial sector.
The Bank has issued six exposure drafts covering liquidity risk management, stress testing, recovery planning, interest rate risk management and internal capital adequacy assessments.
He called on banks to actively participate in consultations before the end of June to ensure the reforms are practical and effective.
At the same time, Dr. Asiama expressed concern over rising cases of fraudulent land title documentation and abuses involving third-party collateral used to secure loans.
He revealed that supervisory reviews had uncovered instances where properties were pledged without owners’ knowledge, ownership documents forged and consent letters falsified.
“When collateral cannot be legally enforced, loan recoveries are compromised, balance sheets are weakened, and public confidence is undermined,” he warned.
The Governor urged bank executives to strengthen verification procedures, tighten internal controls and take decisive action against misconduct.
A Broader Development Role
For policymakers, the message from the Governor was clear: macroeconomic stability alone is not an end in itself.
The next phase of Ghana’s economic recovery will depend on how effectively financial institutions channel resources into productive sectors, support entrepreneurship, facilitate exports and expand investment opportunities.
With economic indicators strengthening and confidence gradually returning, the Bank of Ghana is signalling that the banking sector has a central role to play in converting stability into sustained growth, job creation and long-term prosperity.
