Bank of Ghana (BoG)'s audited financial statement for 2022 mentions the Domestic Debt Exchange Program (DDEP) and COCOBOD loans as the main causes of loss.

As opposed to 2021, when the bank gained GH$1.23 billion in profit, this year's loss is shocking.

The central bank's director of research, Dr. Philip Abradu-Otoo, explained in an interview with Citi FM that the losses were mostly caused by shocks caused by the government's domestic debt restructuring and depreciation of the local currency.

He emphasised that a loss of this magnitude has never been experienced by the bank before.

"The reason for the loss is primarily due to the Domestic Debt Exchange Programme. Just like banks suffered losses on their holdings of government instruments, the BoG also suffered a loss on its holdings of government instruments—both marketable and non-marketable," Dr. Abradu-Otoo stated.

He continued by saying that some loans to COCOBOD were impaired as a result of the restructuring programme, which caused a negative swing in their balance sheet, and that the impact of the DDEP resulted in a loss of GH48.1 billion.

“The impact of the DDEP on these two items, we incurred a loss of GH¢48.1 billion, we also had some loans to COCOBOD which were impaired as a result of the DDEP. DDEP impact that has swung our balanced sheet into negative territories”.

Despite the challenging situation, Dr. Abradu-Otoo expressed optimism that the government would provide capitalization to facilitate the central bank's recovery from the losses. He reassured Ghanaians, especially financial institutions, that their funds deposited with the BoG are safe, emphasizing that the loss was not a result of bad decisions or reckless policies, but a direct impact of the DDEP.

“What were are seeing on the balance sheets of BoG is not as a result of reckless policy, or bad decisions but the direct impact from DDEP. All is safe, carry on with your normal businesses,” he assured.

The Bank of Ghana's audited financial statement for 2022 was released on July 28, revealing 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. The institution is now seeking measures to stabilize its financial position and ensure the safety of its operations moving forward.