The Bank of Ghana (BoG) says comparing the 2022 financial performance with 2021, without taking into consideration of the economic situation in the country is misleading.

According to the central bank, 2022 was the peak of economic and social crisis in Ghana.

In a press statement in response to the Minority in Parliament's reaction to its 2022 Annual Report, it said 2022 was "A culmination of fiscal overruns and debt distress resulted in Ghana losing access to both international and domestic markets.

"The Rating agencies downgraded Ghana to the junk category with huge macroeconomic imbalances. The cedi depreciated sharply from ¢6 to the dollar at the end of 2021 to almost ¢13.1 to the dollar at the end of November 2022 until it came down to about ¢8.57 to the dollar at the end of December 2022 (resulting in about 30 per cent on a year-on-year basis and averaged 31.13%).

"Similarly, inflation rose from an average of 12.62 per cent at the end of December 2021 to 54.14 per cent at the end of December 2022. These developments had a significant impact on the operations of the Bank and every other entity in the country. A year-on-year comparison of the financial statement of all entities in Ghana would reveal these sharp jumps."

The Minority in Parliament says the central bank acted illegally when it purported to write off some debt owed it by government.

This was after the Bank of Ghana had written off over ¢30 billion of government's debt.

Government, earlier this year, wrote off half of the ¢77.6 billion it owed to the Central Bank and replaced the remainder with a lower-yielding, 15-year bond.

The move is part of the country’s push to restructure its domestic debt – a requirement to qualify for the next tranche of a $3 billion International Monetary Fund (IMF) rescue loan.

This, the opposition party says is due to the incompetence of the Governor of the bank, Dr Ernest Addison.

The opposition National Democratic Congress (NDC) and its caucus in Parliament are, therefore, calling for the head of the Governor and his deputies.

Speaking at a news conference on Monday, August 8, Minority Leader Dr Cassiel Ato Forson announced that if the BoG Governor and his deputies do not resign, they will mobilise concerned Ghanaians to occupy the central bank.

But in a response, the BoG said comparing the 2022 financial year to 2021 is misleading without considering the situation in the country.

The Bank gave specific examples and how these developments impacted the Bank’s operation in the year in question.

It cited vehicle maintenance expenses, communication expenses, computer expenses, foreign and domestic travel expenses and external directors' expenses.

Further, the BoG explained the issue of waiver or write-offs without recourse to Parliament as per section 53(1) (2) of the PFM Act. 

"Firstly, the BoG’s understanding is that the Minister for Finance in his 2023 budget statement, which was approved by Parliament, had the policy of debt restructuring as a key policy initiative.

"Any further discussion on parliamentary approvals beyond what was approved in the 2023 budget would be handled by the Ministry of Finance," it said.

Secondly, the BoG said, "Beyond the parliamentary approval, the IFRS accounting standard, which requires the full implementation of the expected credit loss (ECL), meant that the mere announcement by the government of a debt restructuring would trigger ECL applications and impairment charged.

"On this score, the issue of parliamentary approval or not would stop an ECL application and impairments on the books of BoG." 

Lastly, the central bank stated that "the Minister has followed up on his intentions and has submitted a letter to the Bank of Ghana detailing the terms of the exchange.

"All conditions precedent (seeking parliamentary approval) to allow for the exchange of the BoG’s non-marketable instruments under the Domestic Debt Exchange have been satisfied."