The study aimed to assess knowledge management’s effect on banks’ performance in the Accra Metropolitan Area through a mediating variable of banking innovations. The study was based on quantitative and explanatory research design and approach. Convenience sampling techniques were used in sampling 216 respondents, who consisted of staff and managers of five commercial banks in AMA. SPSS was used for the descriptive and confirmatory factor analyses. The study revealed that knowledge management has a positive influence on return on assets, return on equity, and net profit margins. Again, banking innovations showed a statistically significant impact on return on assets, return on equity, and net profit margins. The study revealed that banking innovations mediated the association between knowledge management and the performance of the banks. It was recommended that banking sector firms must progressively embrace knowledge management as part of their management principles.