The Bank of Ghana has proposed a new Liquidity Coverage Ratio (LCR) directive, requiring banks to hold high-quality liquid assets to cover 30 calendar days of financial pressure. The central bank is seeking public and industry feedback on the proposed framework, with a deadline of 30 November 2026 for submissions. This move aims to strengthen how banks manage short-term financial stress.
The proposed LCR framework would introduce a formal prudential benchmark for evaluating banks' ability to absorb sudden cash outflows. This gives regulators a clearer picture of institutional resilience and provides banks with a defined standard to plan around. The consultation is being carried out in accordance with the BoG's Procedures for Issuance of Directives, 2020.
Stakeholders, including banks and members of the general public, are invited to submit written comments to the central bank by email. The BoG will review all substantive feedback received and provide written explanations indicating whether comments were incorporated into the final directive or not. This allows institutions to flag implementation concerns or propose adjustments before the rules come into force.
The liquidity proposal is part of a wider regulatory push by the BoG to reinforce risk management across the banking sector. The central bank has also outlined plans for a Credit Risk Management Directive, which is expected to complement a Non-Performing Loan notice issued last year. This directive targets the quality and management of banks' loan portfolios.
The practical implications for banks will likely extend to treasury operations, asset composition, and liquidity planning. The full scope of the impact will only become clear once the final directive is published. The proposed LCR requirement focuses on short-term liquidity resilience, while the credit risk directive addresses the discipline applied to lending decisions.
The Bank of Ghana has previously taken action against unauthorised digital credit service providers. In a public notice, the central bank named 20 mobile loan applications operating without necessary authorisation, warning that they breach regulatory requirements. The flagged applications represent serious violations spanning customer data privacy and consumer protection standards.
The Bank of Ghana's proposal aims to ensure that banks can continue meeting short-term obligations even when funding conditions tighten sharply. The central bank's move to tighten liquidity standards across the banking sector is designed to strengthen the resilience of Ghana's financial system.
Key points
- The Bank of Ghana proposes a 30-day liquidity buffer rule for banks to manage short-term financial stress.
- The proposed Liquidity Coverage Ratio requirement seeks to introduce a formal prudential benchmark for evaluating banks' resilience.
- The central bank is seeking public input on the proposed framework, with a deadline of 30 November 2026 for submissions.
