Commercial banks in Ghana have pushed back against claims that inadequate scrutiny and unrealistic loan targets are responsible for the surge in non-performing loans (NPLs) within the financial sector.
The banks argue that they adhere to stringent lending practices and risk assessment measures to ensure loan repayments while supporting economic growth.
Victor Asante, Managing Director of First Bank Ghana, addressed the issue, stating that the rise in NPLs is influenced by broader economic challenges rather than reckless lending practices.
He emphasized that factors such as inflation, exchange rate volatility, and disruptions in key sectors have significantly affected borrowers’ ability to repay loans.
“Our banks maintain rigorous credit assessment frameworks before disbursing loans.
However, external economic pressures, including the rising cost of doing business, have made it difficult for some borrowers to meet their repayment obligations,” Asante explained in an interview with Ahotor News.
He further noted that financial institutions continue to refine their risk management strategies to minimize defaults while ensuring businesses and individuals have access to credit.
Additionally, he called on the government and regulators to create an enabling environment that fosters economic stability, allowing businesses to thrive and meet their financial obligations.
The discussion around non-performing loans remains a pressing issue, with stakeholders calling for collaborative efforts between banks, regulators, and policymakers to address the underlying causes and strengthen Ghana’s financial sector.
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