BoG posts GH¢60.81bn losses in 2022

The Bank of Ghana has posted losses totalling GH¢60.81 billion for the 2022 financial year.

This compares to a profit of GH¢1.23 billion recorded in the 2021 financial year.

The losses were a result of the government’s domestic debt restructuring activities, and the depreciation of the local currency, among others.

The BoG’s audited financial statement for 2022 which was released yesterday (July 28) indicated that as at 31 December 2022, the total liabilities of the central bank and its subsidiaries exceeded its total assets by GH¢54.52 billion.

This was specifically due to the Impairment of the Government of Ghana’s securities holdings of GH¢48.45 billion which was occasioned by the DDEP; the Impairment of loans and advances granted to Quasi-government and financial institutions amounting to GH¢6.12 billion; and the depreciation of the local currency resulting in net exchange loss of GH¢5.27 billion.

The report noted that the Board of Directors and Management of the Bank had assessed the policy solvency implications arising out of the negative net worth position and the Group’s ability to continue to generate enough income to cover its monetary policy operations and other operational costs.

“In view of this, the Directors of the Bank will continue to operate on a going concern basis due to a variety of factors underpinned by expectations of an improved macroeconomic situation and policy actions specifically targeted at improving the balance sheet of the Bank of Ghana” the report highlighted.

Specific steps and actions to be taken to recover and build- back a positive equity include retention of profits to help rebuild capital until equity firmly returns to the positive region; and refraining from monetary financing of the Government of Ghana’s budget.

In this respect, action has already been taken with a Memorandum of Understanding on zero financing of the budget signed between the Bank of Ghana and the Ministry of Finance on 26 April 2023.

The BoG is also taking immediate steps to optimize its investment portfolio and operating cost mix to bolster efficiency and profits.

Source: Graphic.com.gh