Fix Credit Risk or Repeat the Crisis — Albert Essien’s Warning to Ghana’s Banks
Former Group Managing Director of Ecobank, Albert Essien, has identified weak risk management — particularly credit risk — as the single biggest downside of Ghana’s banking sector.
Reflecting on Ghana’s recent banking sector crisis, Mr Essien argued that the core challenge facing the industry is not regulatory compliance alone, but how effectively banks manage lending risk.
According to him, while many bankers are well-trained in financial theory and risk analysis, sustainable banking requires more than technical knowledge.
It requires character.
“I think one of the biggest downsides for our bank sector is risk management — especially credit risk. It’s about learning the theory, yes, but also building the character,” he stated.
Mr Essien noted that non-performing loans (NPLs) remain elevated — still hovering in the region of the 20 percent range — and questioned why the industry continues to struggle with credit quality.
“We should ask ourselves why. How do we treat it? How do we reduce it? That is something the Institute should think about,” he said, urging professional bodies to convene experts and develop targeted programmes to address the persistent risk management gap.
Beyond credit risk, the former banking executive warned that the sector is entering a new era defined by rapid automation and artificial intelligence.
Having witnessed the transition from ledger books to spreadsheets, Essien says the next transformation is already underway.
“We are in great automation. The future is about understanding how artificial intelligence will change the banking system,” he explained.
He revealed that some financial institutions are already deploying algorithms to support lending decisions — a shift that demands new technical skills from bankers.
“Banking will basically remain what it is — taking deposits, keeping some, lending some. But the mode of delivery is what is changing,” he added.
His message is clear: Ghana’s banking sector must strengthen credit discipline, build ethical leadership, and embrace AI-driven innovation — or risk repeating the mistakes of the past.
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