At the close of a year marked by difficult policy decisions and painstaking reforms, the Governor of the Bank of Ghana, Dr. Johnson Pandit Asiama, has
At the close of a year marked by difficult policy decisions and painstaking reforms, the Governor of the Bank of Ghana, Dr. Johnson Pandit Asiama, has outlined how 2025 became a turning point for monetary stability, banking sector resilience and the rebuilding of confidence in the financial system.
Speaking at the Chartered Institute of Bankers 2025 Governor’s Day and Annual Bankers’ Dinner at the Mövenpick Ambassador Hotel in Accra on December 20, Dr. Asiama framed the year not as one of comfort, but of adjustment.
He reminded bank executives and regulators that they were not bystanders in the policy process but active participants who had to reprice risk, restructure portfolios and strengthen governance in an environment that demanded discipline.
A system emerging from uncertainty
Dr. Asiama took office earlier in 2025 at a time when confidence in policy coordination and consistency had been badly eroded.
Market behaviour, he noted, reflected uncertainty rather than conviction, making even well-intentioned policy actions less effective.
Restoring credibility therefore became the immediate priority of the central bank.
The first phase of reforms focused squarely on re-establishing monetary and market discipline. In March, the Monetary Policy Committee raised the policy rate by 100 basis points, a move aimed at anchoring inflation expectations rather than merely projecting toughness.
This was reinforced by governance changes within the MPC itself, including transparent majority voting and the publication of individual votes to strengthen accountability.
Operational reforms soon followed.
From June, the dynamic cash reserve requirement was recalibrated to better align cedi deposits with cedi reserves and foreign currency deposits with foreign currency reserves, correcting long-standing liquidity mismatches.
In September, the policy rate corridor was widened to improve short-term liquidity management, while tighter net open position limits in October curtailed speculative foreign currency exposure on bank balance sheets.
The Bank of Ghana also re-engineered its Open Market Operations, introducing longer-tenor sterilisation instruments and restoring the 14-day bill as the main OMO tool.
These measures reshaped liquidity planning and market pricing across the financial system.
The results, according to the Governor, were evident. Inflation, which stood above 23 percent at the beginning of the year, declined steadily into single digits by November, reaching levels last seen in 2019.
Over the same period, the cedi appreciated cumulatively by more than 20 percent. With disinflation firmly established, the MPC was able to cut the policy rate by a cumulative 1,000 basis points over the year, a move Dr. Asiama said would not have been credible without the earlier tightening.
Confidence also returned to the fixed income market. Trading volumes on the Ghana Fixed Income Market more than doubled by October compared to the previous year, signalling renewed market activity after the disruption caused by the domestic debt exchange.
Repairing Banks
Beyond macroeconomic stability, Dr. Asiama stressed that 2025 was equally about repairing and strengthening the banking system itself.
The sector entered the year still burdened by the effects of the Domestic Debt Exchange Programme, with capital adequacy pressures widespread. By the end of 2024, eleven banks were below the prudential capital threshold.
By November 2025, that number had fallen to five, reflecting recapitalisation efforts, closer supervision and improving macro conditions. Nonetheless, the Governor made it clear that remaining capital gaps must be closed.
Asset quality also came under scrutiny. Elevated non-performing loans were treated as a systemic risk rather than a routine statistic.
Banks were given clear timelines to reduce NPL ratios towards the 10 percent prudential benchmark by the end of 2026, with loan restructuring encouraged where viable, particularly as interest rates declined.
Governance Reforms
Boards were reminded that oversight must be substantive, not symbolic. Local governance requirements in foreign-owned banks were strengthened, and clearer expectations were enforced around outsourcing, data protection and operational resilience. Dr. Asiama argued that strong governance is not a constraint on competitiveness but a prerequisite for it.
At the system level, macro-prudential supervision shifted from diagnosis to prevention. Stress testing, forward-looking assessments and capital planning were strengthened, with a clear pathway towards Basel III-aligned tools designed to ensure the system can absorb shocks without amplifying them.
Reforming Microfinance
The Bank of Ghana also turned its attention to the troubled microfinance and specialised deposit-taking institutions sector.
Recognising its importance to financial inclusion and local economic activity, the central bank rolled out a comprehensive Microfinance Sector Reform Strategy aimed at resolving long-standing structural weaknesses and rebuilding public confidence.
Under the new framework, four distinct institutional categories were established – Microfinance Banks, Community Banks, Credit Unions and Last Mile Providers – each with clearly defined mandates and prudential requirements.
The ARB Apex Bank is also set to be restructured into a strategic policy instrument serving the entire microfinance sector, extending its role beyond rural and community banks.
Financial integrity featured prominently in the Governor’s address, especially as Ghana undergoes its third Financial Action Task Force mutual evaluation. Dr. Asiama cautioned that compliance on paper is no longer sufficient, stressing that supervisors will focus on whether controls work in practice.
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