International ratings agency Fitch Ratings has projected that at least six commercial banks operating in Ghana will struggle to meet capital requireme
International ratings agency Fitch Ratings has projected that at least six commercial banks operating in Ghana will struggle to meet capital requirements by the end of 2025 unless they secure new injections of funds or merge with stronger institutions.
According to Fitch’s latest banking sector outlook, the affected banks are unlikely to achieve capital adequacy compliance through internal capital generation alone.
This situation places them at risk of either being acquired by well-capitalised competitors, seeking direct government support, or applying for regulatory forbearance from the Bank of Ghana (BoG).
State Banks Among the Strugglers
Fitch revealed that two of the undercapitalised banks are state-owned institutions that have already benefited from capital support in the past.
Despite these interventions, the report noted that the pair remain short of compliance and will likely require additional government bailouts before the end of 2025.
However, the ratings agency cautioned that such support may not materialise immediately, given the fiscal constraints facing the country.
Sector-Wide Progress Despite Isolated Weaknesses
The warning comes at a time when Ghana’s banking sector has recorded significant improvements in capital buffers.
The capital adequacy ratio (CAR) — which measures a bank’s financial strength — excluding forbearance, stood at 8.7% in February 2024.
By the end of the first half of 2025, that figure had surged to 18.2%, reflecting the sector’s ability to absorb shocks and rebuild following the 2017–2019 banking sector clean-up and the recent Domestic Debt Exchange Programme (DDEP).
The Bank of Ghana had earlier explained that the rebound was partly due to the phased recognition of losses from cedi-denominated government bonds, which heavily impacted banks’ balance sheets.
By December 2025, the remaining 25% of those bond-related losses will be fully incorporated into regulatory capital calculations.
Fitch believes the majority of banks will remain compliant when that adjustment is completed, underscoring that the problem is limited to a handful of vulnerable institutions.
Fragile Banking Recovery
The financial sector has endured turbulent times in recent years.
The 2017–2019 banking sector reforms saw the revocation of licenses of nine banks, 23 savings and loans companies, and over 300 microfinance institutions due to insolvency and weak governance.
Billions of cedis were spent by the state to clean up the sector, restore confidence, and protect depositors.
The sector was again rattled in 2023 when the government’s debt restructuring programme forced banks to take heavy losses on their holdings of domestic bonds.
While the BoG offered regulatory reliefs, including temporary forbearance measures, analysts warned that the sustainability of many smaller and state-owned banks remained uncertain.
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