"Bank of Ghana and Ministry of Finance to sign recapitalization MoU by Q3 2024"

" Bank of Ghana and Ministry of Finance to sign recapitalization MoU by Q3 2024 \r\n\r\nThe Bank of Ghana (BoG) is set to sign a Memorandum of Understanding (MoU) with the Ministry of Finance by the end of the third quarter, aiming for early recapitalization following significant losses in two consecutive years.\r\n\r\nThis MoU is a strategic initiative to restore the financial health of the central bank, which reported a GHS 10.5 billion loss in 2023, primarily due to high expenditure on monetary interventions. This follows an even larger GHS 60.9 billion loss in 2022, attributed to impairments during the domestic debt exchange program (DDEP).\r\n\r\nThe Ministry of Finance and the BoG will formalize the recapitalization plan, ensuring the central bank can maintain its critical role in managing monetary policy and ensuring price stability. The plan will outline the necessary capital, the timeline for recapitalization, and, crucially, the sources of funding.\r\n\r\nThe early recapitalization is expected to bolster the central bank\u2019s operational capacity both domestically and internationally. This will be executed alongside strict adherence to the BoG's zero financing of the government\u2019s budget, an agreement signed in April 2023.\r\n\r\nThe recapitalization discussions involved the BoG, the Ministry of Finance, and the International Monetary Fund (IMF) after assessing the DDEP's impact on the bank\u2019s balance sheet. Unlike the previous year\u2019s impairments, the recent GHS 10.5 billion loss resulted from the BoG\u2019s open market operations aimed at controlling inflation.\r\n\r\nThese operations, which include issuing BoG bills to mop up excess liquidity, were necessary to prevent a surge in demand for foreign exchange and subsequent inflationary pressures.\r\n\r\nBy issuing BoG bills, commercial banks purchase these securities, and the BoG pays its monetary policy rate as interest upon maturity. The central bank asserts that without these measures, inflation would have risen more than anticipated. Despite the substantial loss, the Bank of Ghana maintains that it remains policy solvent and committed to its mandate.\r\n\r\nThis strategic recapitalization effort underscores the central bank's commitment to financial stability and its proactive measures to navigate economic challenges."

"Bank of Ghana and Ministry of Finance to sign recapitalization MoU by Q3 2024"

Digital or Die: IMF Chief Warns Nations as the Future of Money Goes OnlineAMP

Dubai Chambers Highlights Importance of Digital Transformation in Expanding Business Horizons and Strengthening Dubai’s Position as a Leading Capital of the Digital Economy During GITEX Global 2025AMP

African Finance Ministers Endorse Ghana’s GOLDBOD Model as Blueprint for Resource-Driven GrowthAMP