The banking industry’s Non-Performing Loans (NPLs) ratio surged to 24.1% in June 2024, up from 18.7 percent in June 2023.

According to the Bank of Ghana, despite improvements in the banking sector’s performance, elevated credit risk poses a threat to the sector’s recovery process.

However, it believes, the consistent rebound in profits, adherence to recapitalisation plans, and enforcement of strict credit underwriting standards will however help ensure that banks remain on the path to full recovery and resilience.

It stated in its Monetary Policy release that the banking sector performance in the first half of the year points to continued recovery from the impact of the Domestic Debt Exchange Programme.

Total banking sector assets grew by 33.3% to GH¢323.1 billion at end-June 2024, relative to 21.2% growth at end-June 2023.

Profitability, liquidity, and efficiency indicators also improved over the period.

The Capital Adequacy Ratio (CAR) adjusted for reliefs remained unchanged at 14.3%, between June 2023 and June 2024.

Without reliefs, the Central Bank said the CAR was reported at 10.6%  in June 2024, higher than the 7.4% recorded in June 2023.