Deepen support to real sector to promote growth of economy … Governor urges banks
The Governor of the Bank of Ghana (BoG), Dr Johnson Pandit Asiama, has urged banks to intensify support for the real sector of the economy, stressing that the long-term sustainability of Ghana’s financial system depends on the growth of productive sectors such as agriculture, manufacturing, services and exports.
According to him, while the country has made significant progress in achieving macroeconomic stability, financial institutions must now leverage the gains to stimulate economic growth, create jobs and support businesses.
Speaking at the post-130th Monetary Policy Committee (MPC) engagement with Heads of Banks in Accra, Dr Asiama said stable macroeconomic conditions, declining interest rates and advances in financial technology presented opportunities for banks to expand their contribution to national development.
“The banking industry must increasingly turn its attention to its fundamental role of financial intermediation and support for productive economic activity. A vibrant manufacturing sector, competitive agriculture, efficient services sector and thriving export-oriented businesses are essential for generating sustainable credit demand, quality assets, employment and economic prosperity,” he stated.
Dr Asiama noted that the MPC had maintained the Monetary Policy Rate at 14 per cent following an assessment that risks to inflation and economic growth were broadly balanced at the time of its meeting.
He, however, indicated that recent global developments, particularly geopolitical tensions, were being closely monitored due to their potential impact on inflation and economic activity.
The Governor announced that the Bank had replaced the dynamic Cash Reserve Ratio (CRR) framework with a uniform reserve requirement of 20 per cent, to be maintained entirely in domestic currency.
He explained that the measure, which took effect on June 4, 2026, was intended to improve liquidity management, strengthen monetary policy transmission and enhance the development of the domestic financial market.
Touching on the performance of the economy, Dr Asiama said the Composite Index of Economic Activity grew by 12.6 per cent in March 2026, compared with 2.3 per cent in the same period last year.
He said inflation remained under control despite a slight increase in headline inflation from 3.2 per cent in March to 3.7 per cent in May, noting that core inflation continued to decline, reflecting subdued underlying price pressures.
The Governor further disclosed that prudent fiscal management and expenditure controls had resulted in a fiscal surplus of 0.1 per cent of Gross Domestic Product during the first quarter of the year.
He also mentioned improvements in the external sector, with the current account surplus reaching $3.1 billion and Gross International Reserves increasing to $14.4 billion, equivalent to 5.7 months of import cover.
On the banking sector, Dr Asiama said total industry assets had expanded by 26.6 per cent to GH¢493.9 billion, while the Capital Adequacy Ratio improved to 22.3 per cent from 17.5 per cent a year earlier.
He added that the Non-Performing Loan ratio had declined from 23.6 per cent to 18 per cent, reflecting stronger asset quality and improved resilience within the sector.
Despite the gains, he cautioned banks against complacency and urged them to strengthen credit underwriting standards, improve loan recovery efforts and comply fully with prudential regulations.
Dr Asiama also called on banks to develop innovative financial products, provide business advisory services and establish export support initiatives to help Ghanaian businesses access regional and international markets.
He reaffirmed the Bank of Ghana’s commitment to working closely with industry players to build a resilient, inclusive and globally competitive financial sector capable of supporting the country’s development aspirations.
BY KINGSLEY ASARE
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