Finance and tax analyst Nelson Cudjoe Kuagbedzi is proposing that banks and other financial institutions publish names of loan defaulters as a strategy to improve loan recovery and strengthen discipline within the banking sector.

His call follows new data from the Bank of Ghana showing that the non-performing loan (NPL) ratio declined to 18.9 percent in December 2025, from 21.8 percent a year earlier.

While welcoming the improvement, Mr. Kuagbedzi said the level of bad loans remains unacceptably high and continues to pose risks to financial stability.

The decline continues a gradual easing of asset quality pressures in the second half of the year, after the NPL ratio peaked above 23 percent between March and May.

The trend suggests banks intensified recovery efforts, including loan write-offs and restructuring, supported by relatively improved macroeconomic conditions and tighter credit risk management.

A more pronounced improvement is observed when impaired loans classified under the loss category are excluded.

On this basis, the NPL ratio fell sharply to 5.0 percent in December 2025, from 8.5 percent in December 2024, pointing to progress in resolving the most distressed exposures on banks’ balance sheets.

Despite the gains, Mr. Kuagbedzi cautioned that weak loan repayment culture remains a major challenge, particularly among large corporate borrowers and politically exposed entities, which he said often default with limited consequences.

In an interview with Citi Business News, he stressed the need for stronger deterrence mechanisms to complement existing recovery measures such as court actions and credit bureau reporting.

“Banks must periodically publish the names of defaulters in the dailies. Nobody wants to be embarrassed. Once names are published, borrowers will be on standby because they know that if they default, their names will be exposed publicly,” he said.

He added that improved loan recovery would free up capital for lending to productive sectors of the economy, lower borrowing costs over time, and enhance confidence in the banking system.

Mr. Kuagbedzi also called on regulators to support banks with clearer guidelines on disclosure and enforcement, stressing that transparency must be balanced with due process to avoid abuse while protecting the stability of the financial sector.