In October 2023, banks wrote off ¢3.19 billion as bad debt, marking a 9.5% year-on-year increase, as per the Bank of Ghana's Domestic Banks Income Statement.

This amount exceeded the ¢2.92 billion recorded in the same period in 2022, with provisions taking various forms, including loan losses and depreciation.

The Bank of Ghana reported that asset quality risks rose in October 2023, evident in the increased Non-Performing Loans (NPL) stock and NPL ratio during the period.

The industry's NPL ratio surged to 18.3% in October 2023 from 14.0% in October 2022, driven by higher growth in the NPL stock and a contraction in gross loans during the review period.

Similarly, the NPL ratio adjusted for the fully provisioned loan loss category increased from 3.9% to 6.4% during the same comparative period.

The NPL stock saw an 18.8% increase to ¢13.5 billion in October 2023 from ¢11.3 billion in October 2022, reflecting a deterioration in domestic currency loans.

In October 2023, the private sector accounted for the largest share of nonperforming loans, constituting 93.8% of the total.

The industry's NPL ratio reflected a deterioration in NPL ratios for five economic sectors, while three reported improvements during the review period.

Among economic sectors, the agriculture, forestry, and fishing sector recorded the highest NPL ratio of 37.4%, marking a sharp increase from 22.4% a year ago. The construction sector followed with an NPL ratio of 36.9%, up from 31.7% a year earlier.

The transportation, storage, and communication sector recorded the highest year-on-year increase in NPL ratio, rising to 27.3% from 11.2%, while the commerce and finance sector's NPL ratio increased to 19.6% from 15.9% over the same comparative period.

However, the NPL ratios of the electricity, water and gas, manufacturing, and mining and quarrying sectors declined to 8.3%, 13.8%, and 4.1% in October 2023 from their respective positions of 11.1%, 14.6%, and 4.6% in October 2022.