The Bank of Ghana (BoG) has reported mixed performance in the banking sector during the first half of 2024, citing variations in commission growth, gross income, operating expenses, and financial assets.
According to the BoG, net fees and commissions grew by 16.8% in June 2024, down from 30.6% the previous year. Other income experienced a notable contraction, falling by 16.2% to GH¢2.4 billion in June 2024, compared to GH¢2.8 billion in June 2023.
Despite these changes, the banking sector’s overall operating income rose sharply to GH¢16.8 billion in June 2024, up from GH¢14.9 billion in June 2023. Similarly, gross income increased to GH¢23.0 billion from GH¢20.1 billion during the same period.
On the cost side, operating expenses grew by 15.5% in June 2024, significantly lower than the 44.9% increase recorded in June 2023, primarily due to slower growth in staff and administrative costs. Impairment losses on financial assets, including provisions for bad debt and depreciation, contracted by 39.5% in June 2024, a notable improvement compared to the 32.7% increase in June 2023.
BoG highlighted that the sector continues to recover from macroeconomic challenges dating back to 2022. However, asset quality concerns persist as a drag on performance, though the sector remains profitable, liquid, and generally efficient. The rebound in profitability, driven by the post-Domestic Debt Exchange Programme (DDEP) recovery and ongoing recapitalisation efforts, contributed to stability in the sector’s solvency.
Looking ahead, the BoG emphasized the importance of recapitalisation, enforcement of stringent credit underwriting standards, and intensified loan recovery efforts to maintain the banking sector’s stable outlook and performance in the medium term.
