Ghana’s Fiscal Deficit Shrinks to 0.2% of GDP Amid $500B Banking Sector Boom

Provisional data on the Government budget execution for the first seven months of 2026
reflected improvement in revenue mobilisation with marginal shortfalls below target,
alongside constrained total spending.

These developments resulted in an overall fiscal deficit (on commitment basis) of GH¢3.5 billion (0.2% of GDP), as against the budget target of GH¢31.0 billion (1.9% of GDP). The deficit was financed largely from domestic sources.

The primary balance (on commitment basis) recorded a surplus of 1.4 percent of GDP, as
against a surplus target of 0.2 percent of GDP. At end-July 2026, the provisional public debt
stock stood at 45.9 percent of GDP, compared with 44.7 percent of GDP at end-December
2025.

The banking sector remains solvent, profitable, and liquid, alongside improving asset quality.

In August 2026, total assets of the sector increased by 20.5 percent, year-on-year, to
GH¢500.2 billion, supported by robust deposit mobilisation and growth in other funding
sources.

Capital Adequacy Ratio of the banking system improved further to 19.1 percent in
August 2026 from 18.3 percent in August 2025.

Asset quality also improved, with the NonPerforming Loan (NPL) ratio declining to 15.7 percent from 20.8 percent over the same period, supported by the strong rebound in credit growth.

Despite the improvement in the industry’s asset quality, credit risk remained elevated. Banks are, therefore, expected to adhere to the NPL guidelines to bolster confidence in the financial system.