Ghana's banking sector enjoying healthy profitability metrics - Fitch

Fitch Ratings' verdict on Ghana's banking sector is that the sector is enjoying healthy profitability metrics.

According to the credit rating agency, the sector’s pre-tax return on equity and return on assets were 22% and 4.3%, respectively.

Fitch said this in its analysis of the acquisition of a 55.2% stake in Société Générale’s Ghanaian subsidiary by Attijariwafa bank.

The verdict of Fitch reinforces the perception of the Governor of the Bank of Ghana that the banking sector is profitable, although still remains about the non-performing loan ratios of banks.

"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. The capital adequacy ratio of the banking system improved further to 19.1 per cent in August 2026 from 18.3 per cent in August 2025. Asset quality also improved, with the Non-Performing 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," he said during the 132nd MPC press conference in Accra on Thursday, September 24.

Fitch Ratings' comments on the Société Générale stated that the "acquisition will not significantly increase AWB’s exposure to the rest of Africa, although we expect it may slightly diversify AWB’s earnings base due to Ghanaian banks’ healthy profitability metrics.

"The sector’s pre-tax return on equity and return on assets were 22% and 4.3%, respectively, in 8M26. Exposure to the region fell to 24% of consolidated assets at end-1H26 (end-2023: 26%). While this remains high, granular country exposures mitigate risks at group level. We expect continued growth in Morocco to support the relative weighting of domestic operations; Moroccan assets grew by about 4% in 1H26, broadly in line with growth in the rest of Africa."

Below is the full assessment of Fitch...

Fitch Ratings-London/Dubai-05 October 2026: Attijariwafa bank’s (AWB; BB+/Stable/bb+) acquisition of a 55.2% stake in Société Générale’s Ghanaian subsidiary is likely to be ratings neutral for AWB, Fitch Ratings says. Société Générale Ghana (SGG) had assets of less than USD1 billion, or around 1% of AWB’s total assets and 11% of its total equity, at end-2025, and its small size compared to AWB means the acquisition is unlikely to materially increase AWB’s exposure to the rest of Africa or pressure its capital ratios. We also expect SGG to contribute only modestly to AWB’s assets and net income (3% of AWB’s net income in 2025) over the medium term as domestic growth in Morocco should be broadly in line with the growth of AWB’s other African operations.

The acquisition will not significantly increase AWB’s exposure to the rest of Africa, although we expect it may slightly diversify AWB’s earnings base due to Ghanaian banks’ healthy profitability metrics. The sector’s pre-tax return on equity and return on assets were 22% and 4.3%, respectively, in 8M26. Exposure to the region fell to 24% of consolidated assets at end-1H26 (end-2023: 26%). While this remains high, granular country exposures mitigate risks at group level. We expect continued growth in Morocco to support the relative weighting of domestic operations; Moroccan assets grew by about 4% in 1H26, broadly in line with growth in the rest of Africa.

The transaction should also have no material effect on AWB’s regulatory capital ratios, given SGG’s modest size and AWB’s strong earnings generation. AWB’s internal capital generation is underpinned by its healthy return on equity (1H26: 17.5%, annualised). We expect its common equity Tier 1 ratio (end-2025: 10.2%) to remain at 10%-11% in the near term. AWB also retains capital flexibility and could strengthen its capital position, if necessary, through dividend adjustments or additional core capital from shareholders. AWB’s exposure to Ghanaian cedi volatility and any resulting impact on its regulatory capital ratios should be very limited, given the subsidiary’s small size.

The transaction takes place as the operating environment for Ghanaian banks improves. Macroeconomic conditions are stabilising following volatility associated with the 2024 sovereign debt restructuring. Fitch’s upgrade of Ghana’s Long-Term Issuer Default Ratings to ‘B’/Positive from ‘B-‌’/Stable in May reflected a sharp decline in government debt relative to GDP and a marked increase in international reserves, which reduced external liquidity risks. The Positive Outlook reflects our expectation of continued fiscal prudence and a further build-up of external buffers.

Our upgrade of AWB’s Long-Term Issuer Default Rating to ‘BB+’/Stable from ‘BB’/Stable in December 2025 reflected, among other factors, a lower contribution from vulnerable overseas operations to total assets and revenue, a record of strong performance demonstrating the resilience of its business model, and stronger capital ratios. AWB’s VR could be downgraded if the contribution of the rest of Africa to revenue or total assets increases materially, or if capital ratios weaken markedly. We do not expect this acquisition to trigger either of these risks. Our base case remains that AWB will not pursue aggressive external growth in Africa, given the favourable growth prospects in Morocco, combined with a stricter prudential framework around capital adequacy requirements.