Ghanaian banks stand to gain from the closure of the Domestic Debt Exchange Programme (DDEP), but soaring bad loans threaten to cap their profitability, according to Fitch Solutions
In a press statement dated 27 January 2026, the international ratings agency noted that the debt restructuring’s end has bolstered capital buffers across Ghana’s banking sector. Its latest outlook on Sub-Saharan Africa’s banking industry predicts a friendlier monetary policy landscape, with loan growth accelerating in most markets this year.
Yet Fitch flags Ghana’s elevated non-performing loans (NPLs) as a major risk. As of October 2025, these bad loans lingered at 9.5%, a level the agency expects to drag on banks’ earnings.
Region-wide, Fitch anticipates robust loan expansion by year-end, fueled by pent-up demand, brighter economic outlooks, and lower government borrowing amid fiscal tightening. Banks now face urgency to shift capital toward private-sector lending to maintain returns.
In recent years, regional banks ramped up holdings in high-yield government securities now comprising 20-35% of assets in some markets, up from 10-15% pre-pandemic.
Story by: Mercy Addai Turkson #ahotoronline.com