BoG Board outlines steps to revert Central Bank to positive equity position
The Board of the Bank of Ghana, in a bid to fortify the Central Bank’s financial position amidst favorable macroeconomic conditions and return the Bank to a positive equity position, has unveiled a suite of strategic measures aimed at ensuring long-term sustainability and resilience.
Emphasizing the imperative of rebuilding a positive equity stance over the medium to long term, the Board has articulated a steadfast commitment to refraining from monetary financing of the Government of Ghana’s budget.
This resolve, enshrined in the Memorandum of Understanding forged with the Ministry of Finance in April 2023, underscores the Bank’s dedication to upholding fiscal prudence and averting potential inflationary pressures.
In tandem with its commitment to fiscal discipline, the Bank further remains focused on optimizing its operational efficiency and bolstering profitability. Through the continued refinement of its investment portfolio and the judicious management of operating costs, the institution seeks to enhance its financial resilience and augment its capacity to navigate the ever-evolving economic landscape.
Central to the Bank’s strategic agenda is the pursuit of early recapitalization, a mission that enjoys broad consensus among key stakeholders, including the Ministry of Finance and the International Monetary Fund (IMF).
In the wake of extensive deliberations stemming from the second review of the ongoing IMF program, culminating in April 2024, the Bank is poised to finalize a Memorandum of Understanding with the Ministry of Finance to delineate the roadmap for recapitalization.
This concerted effort underscores a collective commitment to fortifying the Bank’s equity position and bolstering its capacity to withstand future financial exigencies.
Looking ahead, the Board envisages that the steadfast implementation of these policy imperatives, in conjunction with a commitment to fiscal rectitude, the maintenance of a rigorous monetary policy stance, and the pursuit of critical structural reforms, will underpin continued operational efficiency and the existence of the Bank of Ghana for the foreseeable future.
Bank of Ghana reports GHS 65.3bn deficit in 2023
In its 2023 Annual Report, the Bank of Ghana revealed a significant deficit, with total liabilities surpassing assets by GH₵65.36 billion, representing an increase from the previous year’s GH₵54.52 billion deficit.
Despite this concerning shortfall, the Bank managed to navigate through operational complexities, demonstrating resilience and adaptability in its financial management.
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.
