Agricultural Development Bank PLC (ADB) recorded a decline in profitability for the first half of 2026, even as the bank reported significant improvements in its balance sheet, liquidity and capital position.

For the six months ended 30 June 2026, ADB posted profit after tax of GH¢192.64 million, down 16.4% from GH¢230.49 million in the corresponding period of 2025. Profit before tax also declined by about 20.5% to GH¢294.53 million, compared with GH¢370.36 million a year earlier.

The decline came as the bank's reported revenue fell 6.0% to GH¢737.88 million from GH¢785.38 million. Operating income stood at GH¢756.00 million, down from GH¢792.73 million.

Net interest income, which remains a major source of earnings for the bank, decreased 10.5% to GH¢559.53 million. Interest income fell from GH¢1.051 billion to GH¢808.18 million, although the bank also benefited from a significant reduction in interest expenses, which declined from GH¢426.00 million to GH¢248.65 million.

There were, however, improvements in some non-interest income lines. Net fees and commission income increased 7.6% to GH¢125.62 million, while net trading income climbed 22.1% to GH¢52.74 million.

ADB reported basic and diluted earnings per share of 0.12, compared with 0.14 for the same period in 2025.

Balance Sheet Expands to GH¢19.54 Billion

Despite the decline in earnings, ADB's balance sheet expanded considerably.

Total assets increased 30.3% to GH¢19.54 billion, from GH¢14.99 billion in the comparative period. Cash and bank equivalents jumped 45.5% to GH¢10.45 billion, while investment securities increased 32.3% to GH¢6.09 billion.

Loans and advances to customers, however, declined by approximately 9.8% to GH¢2.04 billion, from GH¢2.26 billion.

Customer deposits increased strongly, rising 23.5% to GH¢14.86 billion from GH¢12.03 billion. Borrowed funds also increased to GH¢1.52 billion from GH¢1.04 billion.

One of the most notable improvements was in shareholders' equity, which increased 76.8% to GH¢2.67 billion, compared with GH¢1.51 billion. The bank reported GH¢869.39 million under deposits for shares, while accumulated losses improved to GH¢1.59 billion from GH¢1.76 billion.

Recapitalisation Strengthens ADB

The improvement in ADB's capital position follows the bank's ongoing recapitalisation.

According to the financial statements, ADB received GH¢850 million from the Government of Ghana in 2025 as a deposit for shares. The injection helped improve the bank's Capital Adequacy Ratio from negative 3.15% in 2024 to 27.17% as of 31 December 2025.

At ADB's Annual General Meeting held on 24 June 2026, shareholders approved a recapitalisation exercise through a private placement, and the bank has appointed transaction advisers for the process.

As of 30 June 2026, ADB's Capital Adequacy Ratio stood at 26.94%. The bank said its capital position was also supported by continued loan recoveries amounting to GH¢79.3 million.

Its liquidity ratio improved to 155.11%, while the Common Equity Tier 1 ratio stood at 24.94%.

One area investors may continue to watch is asset quality. ADB's ratio of non-performing loans to gross loans remained high at 67.84%, although this was an improvement from 71.08% in the comparative period.

Operating Cash Flow Surges

ADB also recorded a substantial improvement in cash generation.

Net cash generated from operating activities increased to GH¢1.98 billion, compared with GH¢575.71 million in 2025. The bank subsequently used GH¢1.09 billion in investing activities, including approximately GH¢1.08 billion spent on medium- and long-term government securities.

Cash and cash equivalents closed the period at GH¢10.45 billion, up from GH¢7.18 billion.

Outlook

ADB's first-half numbers present two different stories. Profitability weakened, with revenue, net interest income, profit before tax and net profit all declining from the previous year.

At the same time, the bank's financial position strengthened considerably following its recapitalisation. Assets, deposits, liquidity, capital adequacy and shareholders' equity all improved, while operating cash generation increased sharply.

For investors, the progress in recapitalisation and liquidity is encouraging, but the 67.84% non-performing loan ratio remains an important metric to monitor as ADB continues its turnaround. The next phase will be whether the stronger capital base can translate into improved lending quality and renewed earnings growth.