“We will craft very clear policies to return the BoG’s negative equity to positive equity” – Governor

The newly appointed Governor of the Bank of Ghana (BoG), Dr. Johnson Asiama, has laid out plans to reverse the Central Bank’s negative equity position in the wake of recent financial losses.

During his swearing-in on Tuesday, February 25, 2025, Dr. Asiama emphasized that preserving stability, credibility, and public trust depends on the Bank’s financial soundness being restored.

“My sixth and last priority area is the need to reverse the Bank of Ghana’s negative equity position or the losses that have been incurred in recent years all to maintain financial stability, maintain the institution’s credibility, and restore public trust,” Dr. Asiama stated.

Significant losses were reported by the Bank of Ghana in recent years, mostly as a result of debt restructuring initiatives and more general economic difficulties. The Governor emphasized how urgent it is to solve this issue by combining effective financial policies with cost-cutting initiatives.

“In this vein, we will seek to re-examine the Bank’s non-core operations and I must say that some of these have started already in the last two weeks where savings could be made. We shall adopt several austere measures to help reduce the Bank’s operational costs and achieve cost efficiency,” he explained.

As part of the efforts to restore the BoG’s financial position, Dr. Asiama revealed that clear policies would be put in place to ensure a structured return to positive equity in the medium term.

“We will craft very clear policies to return the Bank of Ghana’s negative equity to positive equity in the medium term,” he said.

According to the Bank of Ghana’s 2022 Published Annual Report and Financial Statements, the domestic debt exchange program had a major negative impact on the bank’s balance sheet, resulting in a loss of GHC 60.8 billion.

Economic stakeholders are worried about this development’s possible long-term effects on the economy.

The BoG has repeatedly maintained its stance, asserting that it is still solvent and able to carry out its purpose in spite of the losses. Dr. Ernest Addison, a former governor, also said that when the economy stabilizes, the bank’s financial situation will get better.

During his screening, Thomas Nyarko Ampem, the deputy finance minister-designate, has rejected the idea of recapitalizing the Bank of Ghana with public funds.

Source: Ghanatodayonline.com