Banking Sector Bad Loan Write-Offs Decline 57.1% as Banks Write Off GH¢1.64bn in 2025
Banks in Ghana wrote off GH¢1.64 billion in impaired loans in 2025, representing a 57.1% decrease compared to the previous year.
Figures from the Domestic Money Banks Income Statement released by the Bank of Ghana show that the banking industry had made provisions amounting to GH¢3.82 billion for bad debts in 2024.
These provisions covered expected loan losses, depreciation and other related impairment charges.
Data contained in the central bank’s January 2026 Banking Sector Developments Report indicate that asset quality risks within the banking sector remained relatively high as at the end of 2025, although some key indicators improved during the period.
The industry’s Non-Performing Loans (NPL) ratio declined to 18.9% in December 2025 from 21.8% recorded in December 2024.
In the same vein, the NPL ratio adjusted for fully provisioned loan losses also dropped to 5.0% in December 2025, compared with 8.5% during the corresponding period in 2024.
Despite the improvement in these ratios, the total stock of non-performing loans rose slightly by 0.8% to GH¢21.0 billion in December 2025, compared with the sharp increase of 31.4% recorded in December 2024.
A breakdown of the NPL portfolio revealed that the private sector continued to account for the largest share of impaired loans within the banking industry, largely due to its significant portion of total credit extended by banks.
The share of NPLs attributed to the private sector increased to 97.5% in December 2025 from 96.2% in December 2024, while the proportion linked to the public sector declined to 2.5% from 3.8% over the same period.
The Bank of Ghana explained that the year-on-year reduction in the overall NPL ratio reflected improvements in asset quality across most sectors of the economy.
However, two sectors experienced deterioration in asset quality during the review period. The NPL ratio in the construction sector rose from 29.8% to 30.7%, while that of the agriculture, forestry and fishing sector increased from 38.0% to 46.3%.
All other sectors recorded improvements in asset quality over the period under review.
