Copyright ghanaguardian
Ghana’s banking industry sustained strong growth and profitability in the first eight months of 2025, recording a 46.1% increase in profit-after-tax to GH¢9.7 billion, up from GH¢6.7 billion during the same period in 2024. The September 2025 Monetary Policy Report attributed the robust performance to broad-based income growth across the sector, with significant gains in interest earnings, fees, and other operating income. The report showed that other income rose sharply by 47.3% in August 2025, reversing a 2.9% contraction recorded a year earlier. Net interest income increased by 21.8%, reaching GH¢19.2 billion compared to GH¢16.9 billion in August 2024. This growth was largely driven by lower interest expenses, reflecting easing interbank lending rates and improved cost management by banks. Year-on-year, interest income expanded by 21.5% to GH¢29.3 billion, while interest expenses rose to GH¢10.2 billion from GH¢8.4 billion, representing a 20.9% increase, slightly below the 22.1% growth recorded in 2024. The sector also saw growth in net fees and commissions, which rose 13.1% in August 2025—slower than the 22.9% increase a year earlier—reflecting moderated transactional activity. Overall, net operating income climbed by 28%, a significant improvement from 10.9% growth recorded during the same period in 2024. Operating expenses grew moderately by 19.5%, compared to 18.9% a year earlier, mainly due to marginal increases in staff and administrative costs. In contrast, provisions for depreciation, bad debts, and impairment losses fell sharply by 46%, compared to a 19.2% decline in 2024. The report attributed this to higher recoveries and successful write-offs of legacy non-performing loans. The sector’s overall profitability improved notably, with return-on-equity (ROE) rising to 32.2% in August 2025, up from 31.4% a year earlier, while return-on-assets (ROA) increased from 4.9% to 5.6% over the same period. These gains, according to the report, underscore the banking industry’s strong recovery, improved asset quality, and enhanced balance sheet resilience, reflecting renewed confidence and operational stability in Ghana’s financial sector.
