The Bank of Ghana has reduced its policy rate to 14 per cent, signaling growing confidence in the country’s economic recovery as the banking sector shows signs of renewed strength.
Announcing the decision at the 129th Monetary Policy Committee briefing in Accra, Governor Johnson Pandit Asiama said improving financial sector indicators and easing inflationary pressures supported the rate cut from 15.5 per cent.
The move comes amid a broader rebound in the banking industry, which has been recovering from the economic shocks of 2022–2023. Key indicators—including profitability, liquidity, and asset quality—have all improved, reflecting stronger financial health across banks.
A major highlight of the recovery is the steady decline in non-performing loans (NPLs), which dropped to 18.7 per cent in February 2026 from 22.6 per cent a year earlier. The improvement has been driven by aggressive loan recovery efforts, write-offs, and a gradual return of lending to the private sector.
Lower interest rates are also beginning to ease credit conditions. Average lending rates have fallen significantly to 19.2 per cent, down from over 30 per cent in early 2025, helping to revive borrowing and support business activity.
The Governor noted that investment activity within the sector has surged, with asset growth largely fueled by a sharp rise in bank investments, supported by stronger deposits and capital.
Despite the progress, the central bank cautioned that the level of bad loans remains well above the global benchmark, underscoring the need for continued reforms. To address this, the Bank of Ghana is intensifying supervision, enforcing stricter loan classification rules, and promoting better credit information systems.
Officials say the combination of policy easing and stronger banking fundamentals is expected to further stimulate lending, boost private sector growth, and sustain the country’s ongoing economic stabilisation.
