Banks in Ghana wrote off GH¢654.2 million as bad debt in the first four months of 2025. This marks a drop compared to the GH¢863.4 million recorded in April 2024 and GH¢1.087 billion in April 2022, according to the latest Domestic Money Bank Report by the Bank of Ghana.
The bad debt provision, as noted in the report, was classified under loan losses, depreciation, and other items.
The report also observed that the industry’s exposure to credit risk improved between April 2024 and April 2025. This was reflected in a decline in the non-performing loan (NPL) ratio over the period, though the level remained high in April 2025.
Asset quality within the banking sector showed similar improvement. The NPL ratio dropped to 23.6% in April 2025, down from 25.7% in April 2024. When adjusted for fully provisioned loan losses, the ratio decreased further to 9.0% in April 2025, from 11.1% the previous year.
The Bank of Ghana attributed this improvement to stronger loan growth outpacing the increase in the stock of non-performing loans.
The banking industry’s NPL stock climbed by 8.7%, reaching GH¢21.7 billion in April 2025, up from GH¢20.0 billion in April 2024.
Data from the report revealed that the private sector continued to dominate the NPL landscape, owing to its larger share of industry credit.
The proportion of non-performing loans linked to the private sector increased to 93.4% in April 2025, up from 91.0% in April 2024. In contrast, the public sector’s contribution to the NPL stock fell to 6.6% from 9.0% over the same period.
