Ghana’s banking sector recorded a strong improvement in profitability in 2025, with profit before tax (PBT) rising by 39.8 per cent to GH¢23 billion, up from GH¢16.5 billion in 2024.

The performance was driven largely by higher investment income, stronger net trading income and a sharp reduction in net impairment losses, according to the PwC Ghana Banking Survey 2026.

The survey said the growth in profitability outpaced the sector’s income expansion, with total income increasing by 24.1 per cent from GH¢35.5 billion in 2024 to GH¢44.1 billion in 2025.

Consequently, the industry’s PBT margin improved by 5.9 percentage points, from 46.3 per cent to 52.2 per cent.

Investment income drives earnings

Investment income emerged as a major contributor to the banks’ improved earnings, increasing by GH¢7.8 billion, representing a 45.2 per cent growth in 2025.

The increase occurred despite declines in the average interest rates on the Government of Ghana’s 91-day and 182-day Treasury bills, which fell by approximately 10.8 per cent and 11.1 per cent, respectively.

According to the survey, the growth in investment income was supported by a 57.6 per cent increase in the volume of investment securities held by banks.

The report also linked the development to a Bank of Ghana directive requiring banks to maintain reserves in the same currency as the underlying deposits.

The measure improved Ghana cedi liquidity within the banking system, enabling banks to deploy more funds into securities.

Trading income also rises

Net trading income also recorded significant growth, increasing by GH¢2.4 billion, or 43.5 per cent, during the year.

PwC attributed the increase largely to foreign exchange translation and transaction gains.

The report said the gains were supported by banks maintaining net short foreign currency positions in line with Bank of Ghana policies, together with the strengthening of the Ghana cedi.

It, however, noted that the impact varied among individual banks, depending on their foreign currency exposures and trading strategies.

Loan losses fall sharply

Another significant factor behind the improved profitability was a substantial decline in net impairment losses.

Net impairment losses fell by 75.9 per cent, from GH¢3.5 billion in 2024 to GH¢841 million in 2025.

The survey said the reduction followed an industry-wide clean-up of loan portfolios towards the end of 2025 after a Bank of Ghana directive.

Despite the exercise, impairment charges remained contained, partly because of adequate collateralisation and the full provisioning of non-performing loans.

Impairment reversals and recoveries on existing loans also contributed positively to banks’ bottom lines.

PwC said the development suggested that banks had strengthened their credit management processes and were better positioned to manage credit-loss risks.

Costs remain a concern

The stronger profitability came despite a rise in operating expenses.

Operating expenses increased by approximately 26.5 per cent, from GH¢16 billion in 2024 to GH¢20.2 billion in 2025.

However, the increase in costs was more than offset by the growth in income, allowing a larger proportion of banks’ earnings to translate into profit.

The improvement in the PBT margin from 46.3 per cent to 52.2 per cent therefore points to stronger cost absorption across the sector.

Outlook

PwC cautioned that maintaining the current level of profitability could prove challenging as the banking sector adjusts to a lower-yield environment.

It said banks would need to preserve asset quality, maintain cost discipline, diversify their income streams and adapt their business models to changing market conditions.

The survey emphasised that institutions capable of combining revenue growth with prudent risk management and operational efficiency would be better positioned to sustain their performance.

The 2025 results therefore mark a significant improvement in the sector’s earnings, but the sustainability of that performance will depend on how effectively banks manage credit risks, operating costs and the changing investment environment.