By Benjamin Nii Nai Anyetei
Finance and tax analyst Nelson Cudjoe Kuagbedzi has called on banks and other financial institutions to publish the names of loan defaulters as a way of strengthening loan recovery and improving discipline within Ghana’s banking sector.
His comments follow the release of new data from the Bank of Ghana showing that the non-performing loan (NPL) ratio declined to 18.9% in December 2025, down from 21.8% a year earlier. While welcoming the improvement, Mr Kuagbedzi cautioned that the level of bad loans remains unacceptably high and continues to pose risks to financial stability.
The latest figures indicate a gradual easing of asset quality pressures in the second half of 2025, after the NPL ratio peaked at over 23% between March and May. The trend suggests banks intensified recovery efforts, including loan write-offs and restructuring, supported by improved macroeconomic conditions and tighter credit risk management.
A sharper improvement was recorded when loans classified under the loss category were excluded. On this basis, the NPL ratio fell to 5.0% in December 2025, from 8.5% in December 2024, pointing to progress in resolving the most distressed assets on banks’ balance sheets.
Despite these gains, Mr Kuagbedzi warned that a weak loan repayment culture remains a major challenge, particularly among large corporate borrowers and politically exposed entities, who he said often default with limited consequences.
Speaking in an interview with Citi Business News, he stressed the need for stronger deterrence measures to complement existing recovery tools such as court actions and credit bureau reporting.
“Banks must periodically publish the names of defaulters in the newspapers. Nobody wants to be embarrassed. Once names are published, borrowers will be on alert because they know that if they default, their names will be exposed publicly,” he said.
Mr Kuagbedzi argued that improved loan recovery would free up capital for lending to productive sectors, help lower borrowing costs over time and boost confidence in the banking system.
He also urged regulators to support financial institutions with clearer guidelines on disclosure and enforcement, stressing that while transparency is critical, it must be balanced with due process to prevent abuse and protect the stability of the financial sector.
