BoG to introduce new Credit Risk Management Directive as private credit surges

The Bank of Ghana (BoG) is set to introduce a new Credit Risk Management Directive as private-sector lending records strong growth, with the central bank seeking to ensure that banks maintain sound lending standards.

Governor of the Bank of Ghana, Dr. Johnson Pandit Asiama, announced the planned directive at a post-Monetary Policy Committee (MPC) engagement with heads of banks in Accra on Tuesday, October 6, 2026.

The new directive will complement the Non-Performing Loans (NPL) Notice issued last year and provide a broader framework for managing credit across the banking sector.

Dr. Asiama said the directive would cover the entire credit management cycle, from loan origination to administration, monitoring and recovery.

“Against this background, the Bank will soon issue the Credit Risk Management Directive, which will complement the NPL Notice issued last year,” he said.

“The Directive will strengthen banks’ credit-risk frameworks, covering credit origination, administration, monitoring, measurement and recovery,” the Governor added.

The planned regulatory intervention comes as private-sector credit continues to expand rapidly.

According to the Governor, credit to the private sector grew by 35.5% in August 2026, compared with 13.3% recorded during the same period in 2025.

In real terms, credit growth stood at 29.0%, up sharply from 1.7% a year earlier.

Dr. Asiama said the strong expansion in lending requires banks to maintain effective credit-risk management to protect the stability of the financial sector.

Although the ratio of non-performing loans has declined significantly, he said it remains above regulatory thresholds.

“Although the NPL ratio has declined significantly, it remains elevated relative to regulatory thresholds,” he said.

He consequently urged banks to strengthen their credit-risk management systems and comply fully with existing NPL guidelines.

“Banks are therefore expected to continue strengthening credit risk management, while ensuring full compliance with the NPL guidelines,” Dr. Asiama said.

The Governor also cautioned banks to ensure that the rapid growth in private-sector lending is backed by prudent lending practices.

“At the same time, as private sector credit expands rapidly, this growth must be supported by sound underwriting standards and effective risk-management frameworks,” he said.

He said the new directive was expected to improve asset quality while ensuring that the expansion of credit remains sustainable.

“We expect this to further strengthen asset quality and ensure that credit expansion is sustainable,” Dr. Asiama said.

The BoG is also preparing to introduce a Liquidity Coverage Ratio Directive as part of efforts to strengthen banks’ resilience to financial stress.

According to Dr. Asiama, the directive will establish the first prudential benchmark for banks’ liquidity and require them to maintain adequate high-quality liquid assets to withstand significant liquidity stress over a 30-day period.

“This will complement the Liquidity Risk Management and Liquidity Monitoring Tools Directives issued earlier this year and further strengthen the resilience of banks’ liquidity positions,” he said.
The regulatory measures come as Ghana’s banking sector records improving financial conditions and stronger demand for credit.

The average lending rate in the banking sector fell to 15.9% in August 2026 from 24.2% in August 2025, while private-sector credit growth accelerated significantly.

The BoG says the measures are intended to ensure that expanding credit is supported by sound underwriting and effective risk management, while strengthening the resilience of the banking sector.