Coverage: Q2 2026 · Information to 13 July 2026
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TGB Quarterly Regional Banking Monitor · 13 July 2026
The oil shock split Sub-Saharan central banks between April and early July 2026: South Africa and Tanzania raised rates to 7% and 6.25%, Zambia cut to 13.25%, and Nigeria, Kenya, Ghana, Uganda and the WAEMU held.
The desk view
The Middle East conflict reached Sub-Saharan Africa through fuel prices rather than bank balance sheets. The SARB raised its repo rate by 25bp to 7% on 28 May 2026, and the Bank of Tanzania followed with a rise to 6.25% on 2 July. Elsewhere, policy rates were held or cut cautiously. Banking systems entered the shock in better shape than a year earlier: Ghana's NPL ratio fell to 18.0% in April 2026 from 23.6%, Kenya's to 15.3% in May from 15.6% in February, and Uganda's to 3.04% in March, its lowest since December 2011. The risk now runs through borrowers. The SARB expects banks' NPLs to stay above their long-term average for longer, and the Bank of Zambia has flagged elevated delinquencies among public workers.
The regional picture
The SARB dates the Middle East conflict from 28 February 2026 and the closure of the Strait of Hormuz from 2 March 2026. By its May 2026 meeting the SARB's Monetary Policy Committee described the Strait as still largely closed, with oil prices fluctuating around 100 dollars per barrel. Central banks across the region responded in different directions. The SARB raised its policy rate by 25bp to 7%, effective from 29 May 2026. The Bank of Tanzania raised its Central Bank Rate from 5.75% to 6.25% at its meeting on 2 July 2026. The Bank of Zambia went the other way, cutting by 25bp to 13.25% at its meeting on 11–12 May 2026. The Central Bank of Nigeria held at 26.5% on 19–20 May, the Bank of Ghana at 14.0% on 18–20 May, and the Bank of Uganda at 9.75% on 14 May. The Central Bank of Kenya held at 8.75% on 8 April and again on 9 June 2026, and the BCEAO kept the WAEMU's main rate at 3.00% on 10 June.
Inflation explains much of the split. South African consumer price inflation rose to 4% in April 2026 from 3.1%, and Kenya's overall inflation rose to 6.7% in May from 5.6% in April. Mainland Tanzania's headline rate rose to 4.2% in May 2026 from 3.2% in March. Elsewhere inflation remained low or was falling: Zambia's eased to 6.8% in April 2026 from 7.1% in March, Ghana's was 3.4% in April and Uganda's 3.0% in April, while WAEMU inflation was -0.2% in the first quarter of 2026. Both tighteners pointed to energy: the SARB said April's rise in inflation was mostly due to higher energy costs, and the Bank of Tanzania said its increase was intended to contain inflation driven by high energy, fertiliser and transport costs caused by the conflict in the Middle East.
Reserve requirements also changed in some systems. The Bank of Ghana replaced its dynamic cash reserve ratio with a uniform 20%, held in domestic currency, from 4 June 2026. The Bank of Uganda raised its cash reserve requirement from 9.5% to 11% to absorb excess structural liquidity. The Central Bank of Nigeria kept its cash reserve requirement for deposit money banks at 45%.