BoG record GHS 53.7bn impairment on Government securities for 2023
Impairment regarding Government of Ghana (GoG) securities for 2023 was GH¢53.7bn.
This is an increase in impairment compared to the GHS 48.4bn recorded in 2022.
According to the Bank of Ghana 2023 Annual Report, the GHS 53.7bn impairment is due to the reassessment of Government securities.
The Government of Ghana executed its domestic debt exchange program resulting in a provision of GH¢48.45 billion as of 31 December 2022.
Old Government securities were derecognized, and the new securities were recognized.
The Bank reassessed Government securities for impairment as of 31 December 2023 which amounted to GHS 57.3bn.
Per the report, loans and advances to GoG as well as securities issued to GoG are made at rates of interest agreed between the Ministry of Finance and the Bank of Ghana in accordance with the Bank of Ghana Act.
Interest on any amount overdrawn by GoG is charged at the Bank of Ghana’s normal interest rate.
The Central Bank notes that no new loans were granted by the Bank of Ghana to the Government in 2023.
The Bank of Ghana recorded a significant deficit in 2023 with its total liabilities surpassing assets by GH₵65.36 billion, representing an increase from the previous year’s GH₵54.52 billion deficit.
The Bank’s total operating income witnessed a notable surge, soaring by 47.3% to reach GH₵8.80 billion in 2023.
This remarkable increase was primarily attributed to several contributing factors, including interest earned on investments in securities and bonds held abroad, fines imposed on institutions for regulatory breaches, and various fees and charges.
The Bank’s total operating expenses of GH¢19.2 billion reported for 2023 show a decline when compared with the GH¢66.9 billion recorded in 2022. This was due to impairment charges on Loans and Advances and the Bank of Ghana’s holding of GoG securities.
In 2022, these two line items accounted for GH¢54.5 billion in expense charges on account of the Domestic Debt Exchange Programme.
