The 2023 loss was attributed to a rise in the cost of the central bank’s open market operations.

With interest rates at high levels, the cost of conducting open market operations surged to GH¢8.4 billion, up from the GH¢1.7 billion recorded in 2022. In addition, impairments on newly issued Government of Ghana Bonds, per IFRS standards, added to the loss position reported in the year. 

Notwithstanding the loss, the central bank says its overall operations have been effective enough, and this helped the bank to defend its mandate of bringing inflation down.

Inflation declined significantly in the year, falling from 54.1% in December 2022 to 23.2 per cent in December 2023. 

The Governor of the Bank of Ghana, Dr Ernest Addison, said the bank continued to be policy solvent as the total income earned from the its group operations was enough to cover the costs associated with the conduct of monetary policy operations.

Although the Bank of Ghana has since 2023 maintained that the losses have not impacted its policy solvency, the Graphic Business believes the government must as a matter of urgency prioritise the recapitalisation of the central bank to avert any potential negative impact on the sector.

The International Monetary Fund in its report on Ghana’s three-year programme highlighted that the BoG’s balance sheet had been affected by the debt restructuring exercise and therefore urged the government and the BoG to assess the impact and develop plans for recapitalisation.

The government was unable to do that last year due to the tight fiscal environment and economic challenges but the economy is beginning to show signs of recovery.

It is with this mind and understanding the current economic crunch that the Graphic Business urges the government to quickly put in place measures to recapitalise the bank.

The losses may not immediately impact the operations of the central bank but there could be potential challenges in a year or two if the BoG is not quickly recapitalised.

Although some have argued that the government recapitalising the BoG could compromise the independence and credibility of the central bank, the Graphic Business is of the view that this is the only available option at the moment.

The other option, which is the BoG retaining its profit to build back its capital buffers, may take a longer time, a situation which could expose the central bank if any crisis should happen.

We have been witnesses to how the central bank became the last resort in government’s debt restructuring by taking huge losses on behalf of the government, a situation which saved the economy from further decline. 

This is why the Central bank needs to be recapitalised as soon as practicable, without which we expose the central bank unduly.