Assessing the Impact of the 2017-2020 Banking Crisis in Ghana: The Way Forward

The 2017-2020 banking crisis in Ghana had far-reaching consequences for the nation's financial industry, which has continued to grapple with the economic, social, and governance effects. This study assesses the impact of the crisis on financial stability, public trust, and economic growth, and proposes a way forward to build a more resilient banking sector. A mixed-methods approach was used, combining quantitative and qualitative data. A structured questionnaire was administered to 500 bank customers and other stakeholders affected by the crisis. Additionally, 20 purposive interviews were conducted with bank personnel, regulators, and economists. Data were analyzed using descriptive statistics, t-tests, chi-square tests, ANOVA, and multiple regression analysis to determine the impact and evaluate the effectiveness of policy responses. The crisis was found to have a significant negative impact on financial stability, with the mean stability score dropping from 75.4 before the crisis to 62.7 after (p < 0.001). It severely eroded public trust in banking institutions (χ² = 48.23, p < 0.001) and negatively affected economic growth. Key causes identified include poor corporate governance, high levels of non-performing loans (NPLs), and regulatory weaknesses. The findings underscore the severe economic and social costs of the banking crisis. To rebuild a resilient financial sector, Ghana must focus on strengthening regulatory frameworks, enhancing corporate governance and risk management, improving consumer protection, and promoting financial inclusion. An integrated approach is crucial for restoring confidence and ensuring long-term stability.