BoG proposes new rules to ensure banks can always pay customers when they need their Money

The Bank of Ghana (BoG) has proposed a new regulatory requirement that would compel banks to maintain sufficient high-quality liquid assets to cover their projected net cash outflows over a 30-day period of financial stress.

The proposal is contained in the Liquidity Coverage Ratio (LCR) Directive, 2026, an exposure draft published by the central bank on October 9, 2026, to solicit comments from the banking industry and the general public.

In a notice on its website, the BoG said the consultation is being conducted in accordance with its Procedures for Issuance of Directives, 2020. Stakeholders have until November 30, 2026, to submit their comments.

Under the proposed framework, banks would be required to maintain a Liquidity Coverage Ratio of at least 100 per cent. This means their stock of eligible, unencumbered high-quality liquid assets must be sufficient to cover their total net cash outflows projected over the next 30 calendar days under prescribed stress conditions.

The measure is intended to strengthen banks’ ability to withstand sudden funding pressures and meet financial obligations during periods of significant market or institution-specific stress.

According to the draft directive, the framework is designed to improve the banking sector’s capacity to absorb financial and economic shocks while reducing the risk that liquidity problems in individual banks spill over into the wider economy.

How the proposed liquidity requirement would work

The LCR would be calculated by dividing a bank’s stock of eligible high-quality liquid assets by its total net cash outflows over the next 30 calendar days.

The qualifying assets must be capable of being converted into cash quickly, with little or no loss of value, and must be free from restrictions that would prevent their use during a period of stress.

The directive identifies cash, qualifying balances held with the Bank of Ghana and eligible government securities among the assets that may qualify as high-quality liquid assets. Other eligible securities may also be included, subject to specified conditions and regulatory discounts, known as haircuts.

The proposed framework places limits on the composition of the liquidity buffer. Level 2 assets would be capped at 40 per cent of the total stock of high-quality liquid assets, while Level 2B assets would be limited to 15 per cent.

Banks would also be required to assess potential cash outflows arising from deposit withdrawals, reduced access to wholesale funding, maturing financing obligations and customers drawing on previously committed credit facilities.

The draft further requires banks to conduct their own liquidity stress tests, including scenarios that are more severe and extend beyond the minimum 30-day supervisory requirement.

Implementation timeline

The BoG has proposed September 1, 2027, as the effective date of the directive. Banks would be required to align their internal policies, processes and systems with its provisions by August 31, 2027.

The draft also provides for a one-year pilot period following publication, during which banks would submit quarterly reports to the central bank using prescribed templates. Monthly reporting would be required after the pilot period.

The arrangements are intended to support the monitoring of banks’ liquidity positions and their compliance with the new regulatory framework.

Consultation and stakeholder submissions

The central bank is inviting banks and other interested stakeholders to examine the proposed requirements and submit comments before the directive is finalised.

Submissions should be sent by email to [email protected] no later than November 30, 2026.

The BoG says it will consider all material comments received and provide written explanations addressing how they were treated in the final directive, including whether they were incorporated.

The consultation offers banks and other stakeholders an opportunity to raise concerns about the proposed framework and recommend changes ahead of implementation.

Part of broader banking-sector reforms

The proposed LCR requirement forms part of the BoG’s broader regulatory framework for strengthening liquidity risk management in the banking sector.

The exposure draft states that the directive is intended to complement the Liquidity Risk Management Directive, 2026, and the Liquidity Monitoring Tools Directive, 2026, providing both quantitative requirements and supporting liquidity-risk monitoring measures.

While the LCR would establish a minimum benchmark for banks’ short-term liquidity buffers, its implementation could require adjustments to treasury operations, asset allocation, liquidity forecasting and regulatory reporting.

The extent of these adjustments will depend on the final provisions adopted by the central bank following the consultation process.

The proposal is therefore a significant development in the regulation of bank liquidity in Ghana, with the final requirements expected to shape how banks prepare for and respond to periods of financial stress.