The banking sector maintained strong profitability in the first four months of 2026 despite declining interest rates and moderating income growth, recording a combined after-tax profit of GH¢4.6 billion as the industry continued to benefit from improved macroeconomic stability and tighter cost management.
The latest banking sector performance data released by the Bank of Ghana show that banks earned GH¢4.6 billion in profits between January and April 2026, representing a 7.1 percent increase over the GH¢4.3 billion recorded during the same period in 2025.
The improved earnings come against the backdrop of Ghana’s remarkable macroeconomic turnaround over the past year, during which inflation declined to historic lows, the cedi strengthened significantly, and the Bank of Ghana gradually reduced its Monetary Policy Rate as economic conditions improved.
These developments have contributed to lower lending rates and declining yields on money market instruments, reshaping the earnings profile of commercial banks.
According to the central bank’s data, profit before tax also continued its upward trajectory, increasing by 5.6 percent in April 2026 compared with the same period last year.
However, the pace of growth slowed considerably from the 21.9 percent expansion recorded in April 2025, reflecting a moderation in banking sector revenues as interest rates continued to decline.
The Bank of Ghana noted that, with the exception of other operating income, every major source of banking revenue recorded slower growth during the review period compared to the previous year.
Net interest income, traditionally the largest contributor to bank earnings, recorded the sharpest slowdown. Growth declined from a robust 15.5 percent in April 2025 to a contraction of 2.2 percent in April 2026 as banks earned less interest income due to falling lending rates and lower returns on money market investments.
Income from fees and commissions continued to support profitability but also experienced slower growth. Fee and commission income expanded by 15.6 percent in April 2026, down from the stronger 26.2 percent growth recorded during the corresponding period in 2025.
Despite slower revenue growth, banks were able to preserve profitability through disciplined cost management. Operating expenses increased by only 2.1 percent during the first four months of the year, a significant improvement from the 23 percent growth recorded over the same period in 2025.
The moderation in operating costs was largely attributed to controlled staff expenses and a substantial reduction in non-staff operational costs, allowing banks to offset part of the pressure created by weaker income growth.
However, the industry faced rising credit risk costs during the period. Provisions for depreciation, bad debts and impairment of financial assets increased sharply by 35.1 percent, compared with a contraction of 24.2 percent recorded in April 2025.
The increase suggests banks are adopting a more cautious approach to credit risk management as lending activity gradually recovers.
Although profitability remained positive, key performance indicators showed some moderation compared to the previous year. The banking sector’s Return on Assets (ROA) declined to 4.3 percent in April 2026 from 5.0 percent a year earlier, indicating that banks generated slightly lower returns from their asset base.
Similarly, Return on Equity (ROE), which measures the profitability generated from shareholders’ investments, fell to 22.4 percent from 30.0 percent recorded during the same period last year, reflecting the combined effects of narrowing interest margins and changing market conditions.
The latest performance underscores the resilience of Ghana’s banking industry as it transitions into a lower interest rate environment following the country’s macroeconomic recovery.
In recent months, Bank of Ghana Governor Dr. Johnson Pandit Asiama has consistently indicated that the financial sector remains well-capitalised and profitable but must gradually reduce its dependence on interest income by diversifying into transactional banking, digital financial services, payments, treasury operations and other fee-based income streams.
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