'Central Banks cannot be insolvent or bankrupt' – Bank of Ghana

The Bank of Ghana has emphasized that it cannot become insolvent or bankrupt as suggested by some economists and analysts.

In a statement issued on August 9, 2023, to clarify aspects of its 2022 audit financial statement which highlighted an impairment loss of GH¢60.8 billion for the period, the BoG explained that Central Banks do no operate like commercial banks.

It further pointed out that the recent financial outcome of the impairment loss “has very little implication for the operations of the Bank of Ghana as supported by evidence from other central banks”.

“Technically, Central Banks cannot be insolvent or bankrupt,” the BoG added.

Meanwhile, the BoG Governor, Dr. Ernest Addison, and his deputies have been criticized for the huge losses recorded in 2022.

The Minority in Parliament, for instance have given the leadership of the institution a 21-day ultimatum to resign over they described as gross mismanagement of the economy.

But the BoG has insisted the impairment losses recorded in 2022 was largely due to government’s Domestic Debt Exchange, COCOBOD loans and depreciation of the cedi.

Officials at the Bank have explained that it took about 50 percent of the haircuts associated with the government's debt swap programme.

YAM/NOQ

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