Bank of Ghana loses GH¢60Bn: Central Bank Rejects Accusations Of Reckless Spending And Blames DDEP For Loss

• The Bank of Ghana has said claims that it lost close to GH¢60 billion in 2022 due to reckless spending are unfounded
• Director of Research at the central bank, Dr Philip Abradu-Otoo, said if not for the DDEP, the loss would not have been recorded
• He, however, disclosed that there are ongoing efforts to inject adequate capital into the central bank

The Bank of Ghana (BoG) has fought against accusations that the GH¢60 billion loss it recorded in 2022 was due to reckless policies.

Director of research at the central bank, Dr Philip Abradu-Otoo, has rejected claims by policy analysts that because the Bank of Ghana does not operate like a commercial bank, it cannot lose money.

“We chose an action to save the economy from total collapse but as a result of the DDEP [Domestic Debt Exchange Programme], it has landed us here,” he told Citi News.

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Ofori-Atta's DDEP widely criticised

This is not the first time the Domestic Debt Exchange Programme (DDEP) has been criticised as poorly thought through.

The programme by Ghana's finance ministry, led by Ken Ofori-Atta, was to prevent an economic collapse due to the government's inability to pay domestic lenders.

However, the plan, described as insensitive because it eroded the investments of thousands of Ghanaians, faced fierce public resistance.

Individual bondholders, banks and other interest groups rejected the proposals under the voluntary debt exchange programme.

Commercial banks took the fall, with experts projecting that smaller banks will come out more battered than the big banks.

The BoG’s audited financial statement for 2022, released on July 28, 2023, shows that even the central bank was not spared.

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The figures in the report showed that as of December 31, 2022, the total liabilities of the central bank and its subsidiaries exceeded its total assets by GH¢54.52 billion.

BoG will recover the losses

The BoG director of research disclosed that there are ongoing efforts to inject capital into the central bank.

“The central bank will have to retain its profits. We are now going to ensure that we strictly retain all our profits...we need now to move towards optimising the returns from our portfolio. We manage our funds ourselves at the Bank of Ghana," Dr Abradu-Otoo said.

Minority slams BoG for losing money

Meanwhile, YEN.com.gh reported in a related story that the Minority has said it is strange that the Bank of Ghana would lose money in the Domestic Debt Exchange Programme (DDEP).

A ranking member on the finance committee of Parliament, Isaac Adongo, said the central bank cannot undertake monetary policy without printing money.

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Speaking on behalf of the Minority after the 2023 mid-year budget presentation on July 31, the MP said the Bank of Ghana is broke.

Source: YEN.com.gh