News Guide Africa

Tag: Ghana Association of Banks (GAB)

  • BoG, CIB join forces to guard Ghana’s financial ecosystem

    BoG, CIB join forces to guard Ghana’s financial ecosystem

    Ghana’s central bank and its premier professional banking body have pledged a renewed, united front to fortify the nation’s financial sector against emerging risks, fraudulent practices, and shifting technological disruptions.

    The renewed alliance between the Bank of Ghana (BoG) and the Chartered Institute of Bankers (CIB Ghana) was finalized during a high-level strategic visit by CIB Ghana’s newly appointed Governing Council to the Governor of the Bank of Ghana, Dr. Johnson Pandit Asiama, at Bank Square in Accra.

    The dialogue focused on embedding strict ethical standards, elevating professional capacity, and preparing the industry for complex challenges ranging from cybersecurity and digital assets to artificial intelligence and quantum computing.

    Elevating Standards Across the Financial Spectrum

    During the engagement, the incoming President of CIB Ghana, Dr. Ellen Ohene-Afoakwa, presented the Institute’s strategic roadmap aimed at fostering competent, future-ready banking professionals. She highlighted flagship initiatives such as the Branch CEO Programme, the Chartered Banker for Executive Leadership (CBEL) Programme, and nationwide ethics and fraud awareness certification campaigns.

    Dr. Ohene-Afoakwa emphasized that the leadership team is focused on upholding integrity and building institutional capacity ahead of major global events.

    “Our vision is centered on dialing up ethics and professionalism across all tiers of the banking sector, rebuilding the Bankers’ House, and successfully hosting a truly World Conference of Banking Institutes (WCBI),” Dr. Ohene-Afoakwa stated.

     

    Ghana is scheduled to host the international WCBI conference in Accra in 2028, offering a global platform to highlight the nation’s financial education ecosystem and showcase Africa’s contributions to modern banking development.

    Focus on Fraud Prevention and Community Banking

    Welcoming the delegation, Governor Dr. Johnson Pandit Asiama commended CIB Ghana’s proactive stance in supporting regulatory bodies and stakeholders, including the Ghana Association of Banks (GAB), to combat fraudulent activities and emerging operational risks.

    Dr. Asiama stressed that high ethical standards are non-negotiable for maintaining public trust in financial institutions, comparing the sector’s duty of care to that of essential public services.

    “Just as society expects unwavering competence and moral responsibility in the health sector, those working in the banking sector must consistently demonstrate high levels of professional skill, ethical conduct, and accountability,” Dr. Asiama remarked.

     

    The Governor outlined ongoing central bank efforts to enforce rigorous background verifications and drive reforms within community banking. He challenged CIB Ghana to expand its training and certification programs beyond mainstream commercial banks.

    “I encourage the Institute to extend its ethics and capacity-building frameworks to encompass community banks and the broader financial ecosystem to ensure holistic protection for depositors,” he added.

     

    The meeting concluded with both entities expressing confidence that deepened institutional collaboration will foster a secure, trusted, and ethically sound banking industry capable of driving sustainable economic growth across Ghana.

     

  • BoG signals possible lifeline for struggling bank as recapitalization deadline looms

    BoG signals possible lifeline for struggling bank as recapitalization deadline looms

    By Adnan Adams Mohammed

    The Bank of Ghana (BoG) has indicated it is considering a strategic extension of the recapitalization deadline for a single, unnamed commercial bank currently struggling to rebuild its capital to meet the minimum capital requirement following the impacts of the Domestic Debt Exchange Programme and the recent poor quality of risk assets held by the sector.

    The move, seen by industry analysts as an attempt to maintain systemic stability rather than trigger another aggressive round of liquidations, marks a rare moment of flexibility from the central bank since the 2017–2019 financial sector clean-up.

    Following the domestic debt exchange program (DDEP), several indigenous banks saw their capital buffers severely eroded. The BoG subsequently mandated all universal banks to rebuild their capital to a minimum of GH¢400 million.

    While the majority of the 23 active commercial banks in the country have successfully shored up their capital through retained earnings or fresh shareholder injections, one institution remains in the “danger zone.”

    According to sources close to the regulator, this specific bank has shown a “credible and documented plan” to secure the necessary funds but requires a marginal window beyond the original cutoff to finalize the transaction.

    Stability over liquidity

    The Governor of the Bank of Ghana, Dr. Johnson Pandit Asiama, has previously emphasized that the regulator’s priority is to ensure a “resilient and robust” banking sector. By considering an extension, the BoG appears to be opting for a “soft landing” for the struggling entity to avoid the high costs and public panic often associated with bank closures.

    “The objective is not to collapse banks, but to ensure they are healthy enough to support the economy,” a senior official at the BoG noted. “If a bank has a clear path to compliance and the delay is purely administrative or logistical, it makes sense to allow them the time to cross the finish line.”

    Market reaction

    The news has been met with cautious optimism by the Ghana Association of Banks (GAB). Financial experts argue that a single bank failure, even if isolated, could dampen investor confidence just as the sector is beginning to recover from the shocks of the 2023 fiscal crisis.

    “This is a pragmatic move,” said a banking consultant in Accra. “The DDEP hit the local banks the hardest. Giving an institution that is 90% of the way there a few more months to breathe is better for the taxpayer than a full-scale intervention.”

    Governance and transparency

    Despite the potential extension, the BoG has made it clear that any reprieve will come with “stringent conditions.” This likely includes closer regulatory oversight, restrictions on dividend payments, and a freeze on high-risk lending until the capital injection is fully verified.

    The identity of the bank remains confidential to prevent speculative withdrawals of deposits by customers, though rumors in the financial district suggest it is a medium-sized indigenous lender with significant exposure to the public sector.

    As the financial year draws to a close, all eyes will be on the BoG’s final directive. Whether this extension becomes a blueprint for other struggling entities or remains a “one-off” exception will determine the shape of Ghana’s banking landscape heading into 2027.

     

     

     

  • Bank lending rates fall in response to latest BoG benchmark interest rate cut

    Bank lending rates fall in response to latest BoG benchmark interest rate cut

    By Toma Imirhe

    Following the latest cut by the Bank of Ghana’s Monetary Policy Committee (MPC) to its benchmark Monetary Policy Rate (MPR) which it trimmed it by 250 basis points to 15.50% at its late-January 2026 meeting Ghana’s commercial banking sector has begun to adjust its deposit and lending rate structures amid evolving credit conditions. The MPR cut, the first major policy action of 2026, reflects a broader easing cycle that has seen multiple reductions since mid-2025 and is intended to support economic recovery while preserving price stability.

    Responding to the fall in benchmark rates, Ghana’s commercial lenders have begun adjusting their interest rate schedules, particularly for variable-rate loan customers:

    According to industry sources, many commercial banks have started trimming interest rates on both existing and new loan facilities in line with the decline in the Ghana Reference Rate, notably since early January. These adjustments have largely affected borrowers on variable interest rate contracts, where repayment terms automatically realign with benchmark movements.

    The Ghana Association of Banks (GAB) has noted that the transmission of reference rate cuts into commercial lending rates is progressing across most lenders, even as critics warn that the pace of transmission still needs to accelerate to offer tangible cost relief to businesses.

    On the deposit side, while comprehensive data for 2026 remains limited, financial market observers report deposit rate cuts have remained relatively low compared with the declines in lending yields. This suggests banks are balancing a narrowing interest margin with competitive needs for deposit mobilization, especially in a softer monetary environment.

    Although specific banks have not publicly detailed broad, sector-wide lending rate cut announcements, analysts assert that larger lenders such as GCB Bank Limited, Ecobank Ghana, Absa Bank Ghana Limited and Stanbic Bank Ghana Limited historically among those with competitive lending portfolios are likely adjusting their loan pricing across products to mirror the lowered Ghana Reference Rate (GRR) and the MPR.

    The GRR, which is effectively the base lending rate used by commercial banks to price most loans and influenced by the MPR, interbank and government securities yields, has fallen modestly to 14.58% in early February 2026 from 15.68% in January.

    Treasury bill rates, which feed into the GRR calculation, have also declined following the policy adjustment. In the first week of February, yields on 91-day, 182-day and 364-day bills slid to roughly 9.97%, 11.82% and 12.06%, respectively, down from levels reported during late January auctions.

    Interbank rates the cost of overnight funds traded between banks have similarly eased, contributing to the lower GRR, although these remain well above the deposit rates, reflecting ongoing liquidity management in the banking system.

    Historical data from the Bank of Ghana also shows that average lending rates the headline price of credit across all maturities have steadily declined over the past year. By the end of 2025 these averaged just over 20%, down sharply from around 30% in early 2025.

    The MPR, a foundational anchor for money market interest rates in Ghana, started the easing cycle in 2025 from 28% during the first half of the year, to 25% in late July, before it moved down to 21.5%, September and then to 18% by late November, before this latest substantial reduction. This series of cuts increasingly improved liquidity conditions and assisted the downward momentum in key market rates.

    Looking ahead, market analysts largely expect the central bank to maintain an easing bias in coming MPC meetings, especially if inflation remains subdued within or near the medium-term target band and economic growth remains on track. This outlook suggests the possibility of further cuts or at least a sustained lower policy rate later in 2026, which would reinforce the downward trajectory for money market rates and promote cheaper credit availability.

    While challenges such as deposit rate rigidity and credit risk premiums persist, the policy pivot to a 15.50% MPR and ongoing transmission into commercial bank pricing signals meaningful progress in lowering borrowing costs for Ghana’s businesses a critical element for renewed investment and economic momentum in 2026.

    Consumer and corporate borrowers alike will be watching closely for both subsequent MPC decisions and more decisive rate adjustments from major lenders in the weeks ahead.