The decline was driven primarily by reduced credit to the public sector, alongside a moderation in private sector credit flows as banks reallocated portfolios toward Government and Bank of Ghana securities.

This was captured in the 2025 September 2025 Monetary Policy Report.

Also, private sector credit flows amounted to GH¢10.710 billion in August 2025, down from GH¢14.319 billion in August 2024.

Despite this slowdown, the private sector remained the dominant recipient of credit, accounting for 95.5% of total outstanding credit in August 2025, compared with 92.7% a year earlier.

By sectoral distribution, credit flows were concentrated in the services (68.2%), commerce and finance (23.8%) and manufacturing (23.0%) sectors.

The outstanding private sector credit was GH¢91.028 billion at end-August 2025, compared to GH¢80.318 billion at end-August 2024.

In real terms, the private sector credit recorded a modest expansion of 1.7%, as against a contraction of 1.1% over the same period in 2024.

The growth in real sector private sector credit was, however, slightly above trend, with the deviation from trend widening marginally in August 2025, compared to the previous year.

Source: Joy Business

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This is compared with the 25.5% growth recorded in June 2024.

The profit before tax also rose by 32.2% to GH¢10.8 billion, from GH¢8.1 billion in June 2024.

According to the report, the higher growth in profit during the first half of this year was due to increases in interest income and other income lines in 2025 relative to the same period in 2024.

Generally, all income lines increased at higher growth rates in June 2025 compared to the same period last year.

Net Interest Income

Net interest income increased by 20.2% to GH¢14.2 billion, higher than the corresponding growth of 19.4% in June 2024.

In year-on-year terms, interest income increased to GH¢21.6 billion from GH¢18.0 billion, representing a growth of 20.4% in June 2025 compared with 19.1% in June 2024.

The higher growth in interest income is explained by the relatively higher rates on money market instruments this year compared to the first half of 2024, as well as higher lending rates.

Interest expenses also rose to GH¢7.5 billion in June 2025, representing a higher growth rate of 20.7% compared to the 18.6% growth recorded in June 2024.

Net Fees and Commissions

The net fees and commissions recorded a marginal growth of 17.8% from 16.8% a year ago, while other income recorded a higher growth of 52.2% to GH¢3.6 million.

This is from GH¢2.4 billion (16.2% contraction) during the same review period.

According to the report, these developments in the different income lines culminated in an increase in the industry’s operating income to GH¢20.9 billion in June 2025 from GH¢16.8 billion. This represented  a higher growth of 24.4% compared to 12.3% in the year prior.

Similarly, gross income increased to GH¢28.3 billion in June 2025 (23.4% year-on-year growth) from GH¢23.0 billion in June 2024 (14.0% year-on-year growth).

Cost Lines

The cost lines also recorded similar increases in growth rates in June 2025 compared to the same period in 2024.

The banking industry’s operating expenses grew by 21.4% in June 2025, compared to 15.5% in June 2024. This is on the back of higher growth in staff costs and other operating (administrative) expenses.

However, impairment losses on financial assets as well as provisions for bad debt and depreciation contracted by 14.8% in June 2025, compared to the 39.5% contraction in June 2024.

Source: Joy Business

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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.