The Ibrox outfit parted ways with Balogun in 2022, but brought the 35-year-old centre-back back on a free transfer from Queens Park Rangers last summer.
Balogun featured only two times before the arrival of new Rangers boss Philippe Clement and the Belgian tactician has reinstated the experienced centre-back in the starting line-up.
Ferguson admitted that Balogun has impressed him since his return to Ibrox and he added that he was baffled when Rangers let the player leave on a free transfer in 2022.
The former Rangers star stressed that the defender is a brilliant backup for the squad and praised his no-nonsense defending style.
He also pointed out that the Rangers star is a big and strong player and is good on the ball.
“I like him, I like the way he comes across and I like him as a player”, Ferguson said on the Go Radio Football Show.
“I said that when Rangers let him go down to QPR on a free transfer, I was surprised.
“Leon Balogun is not going to play every single game, but he is a brilliant backup.
“And since he has come back to the team, I have been so impressed with him.
“No-nonsense defender; big, strong, powerful and he is pretty decent on the ball.”
Rangers are set to go up against Aberdeen at Pittodrie on Sunday and it remains to be seen whether Balogun will be in the starting line-up for that game.