The Bank of Ghana has revealed that the banking sector’s performance in half-year 2024 pointed to continuing recovery from the macroeconomic challenges since 2022.

However, asset quality concerns remained a drag on the performance of the sector.

According to its July 2024 Monetary Report , the banking sector remained profitable, liquid, and generally efficient during the review period, with stable solvency reflecting the rebound in profitability in the industry post-Domestic Debt Exchange Programme implementation, as well as the ongoing recapitalisation effort by banks.

“The outlook remains stable, but recapitalisation and enforcement of stringent credit underwriting standards, and intensified loan recovery efforts are critical to ensuring good performance of the banking sector in the medium term”, it mentioned.

Credit Conditions Survey

Meanwhile, the results of the June 2024 Credit Conditions Survey indicated a net easing in the overall stance on loans to enterprises between May and June 2024.

This was on the back of a net easing in the stance on all components of enterprise loans namely short-term and long-term enterprise loans, loans to Small and Medium Scale Enterprises, and loans to large enterprises.

The Central Bank pointed out that banks projected their overall stance on enterprise loans to record a net tightening in July and August 2024, from a tightening in all components of enterprise loans apart from loans to large enterprises.

The overall stance on loans to households also eased during the June 2024 survey round from net ease in loans for house purchase, while consumer credit and other lending tightened marginally.

Over the next two months, it said banks project further net easing in the overall stance on loans to households, which will be reflected in loans for house purchases and consumer credit.