In a decisive move to strengthen Ghana’s financial sector, the Bank of Ghana (BoG) has unveiled a series of regulatory measures aimed at addressing the persistent issue of loan defaults and enhancing transparency within the banking industry.
Key Highlights of the New Measures:
• Disclosure of Willful Defaulters: Commercial banks are now mandated to disclose the identities of blacklisted willful defaulters in their audited financial statements. This initiative aims to promote transparency and accountability within the banking sector.
• Restriction on Further Credit: Banks are required to restrict additional credit facilities to strategic or willful defaulters and share their identities with key financial sector oversight bodies.
• Cap on Non-Performing Loans (NPLs): A directive has been issued for commercial banks to cap their Non-Performing Loan Ratios at 10% of gross loans by December 2026. This measure is aimed at restoring asset quality and promoting sound lending practices.
• Enhanced Reporting and Transparency: Banks are instructed to enhance their NPL reporting and disclosures, including monthly submissions and improved public transparency.
Digital Lending Regulations:
Recognizing the challenges posed by unregulated digital lending platforms, the BoG is finalizing comprehensive digital lending guidelines, expected to be issued by August 2025. These guidelines will address licensing, disclosure of terms and interest rates, data protection, and ethical recovery practices.
Strengthening Governance in Foreign-Owned Banks:
The BoG has also announced plans to issue directives aimed at reinforcing local accountability and board independence in foreign-owned banks operating in Ghana. This move seeks to ensure that major credit and risk decisions are made within the country, under the purview of Ghanaian regulatory oversight.
These comprehensive measures underscore the BoG’s commitment to fostering a resilient and transparent financial system in Ghana. Stakeholders are encouraged to familiarize themselves with these new regulations and ensure compliance to promote a stable banking environment.
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