Omanghana
The Bank of Ghana has released a draft Credit Risk Management Directive for public consultation, proposing stronger lending controls for banks, savings and loans companies, finance houses and financial holding companies.
The draft sets July 1, 2027, as the implementation date, with affected institutions expected to align their governance arrangements, internal policies and procedures by June 30, 2027. Industry stakeholders and the public have until November 30, 2026, to submit comments before the framework is finalized.
The proposed rules seek to strengthen financial institutions’ ability to identify and manage lending risks, with controls suited to their size, operations and capital strength. They cover responsibilities across loan assessment, approval, monitoring and recovery.
Boards would retain overall responsibility for credit risk oversight and review their institutions’ lending policies and risk appetite at least annually, or whenever significant changes occur. Senior management would be responsible for implementing those policies and clearly assigning duties throughout the lending process.
The draft also provides for timely write-offs of fully provisioned loans where there is no reasonable expectation of recovery. However, writing off a loan would not cancel the institution’s legal right to pursue repayment. Prior written approval from the central bank would generally be required, subject to exemptions determined by the regulator.
Alongside the credit risk proposals, the Bank of Ghana has published a draft Liquidity Coverage Ratio Directive aimed at strengthening banks’ capacity to meet payment obligations during periods of financial stress.
The liquidity framework proposes a minimum ratio of 100%, requiring banks to hold sufficient high-quality liquid assets to cover projected net cash outflows over a 30-calendar-day stress period. This buffer is intended to improve resilience when funding becomes difficult to obtain or withdrawals increase.
The liquidity draft sets a separate implementation date of September 1, 2027, with banks expected to adjust their internal systems and processes by August 31, 2027. Comments on both drafts can be submitted to bsdletters@bog.gov.gh by November 30, 2026.
Source: Omanghana
