The International Monetary Fund (IMF) has defended the Bank of Ghana (BoG) concerning its significant financial losses, asserting that these costs were essential for stabilising Ghana’s economy following a period of severe macroeconomic distress. IMF Mission Chief Ruben Atoyan stated on Thursday that the central bank’s monetary policy actions were prudent, not overly aggressive, and have yielded positive outcomes.
Context of Economic Challenges
These statements follow the recent release of the Bank of Ghana’s 2025 audited financial statements. The report revealed a substantial loss of GH¢15.6 billion for the year. This figure represents a significant increase from the GH¢9.49 billion loss recorded in 2024.
Furthermore, the central bank’s negative equity position worsened considerably, rising to GH¢93.82 billion from GH¢58.62 billion in the previous year. These financial setbacks are primarily attributed to the Bank’s aggressive liquidity management and sterilisation operations.
These operations were implemented as a strategy to control inflation and restore overall economic stability in Ghana. The nation has been navigating a challenging economic landscape, including a recent crisis and a debt restructuring program.
IMF’s Rationale for the Losses
Dr. Atoyan explained that the costs incurred by the Bank of Ghana were an unavoidable consequence of implementing necessary monetary policy measures. He emphasized that there is an inherent financial cost associated with conducting monetary policy, especially in environments characterized by high inflation and elevated interest rates.
“You know that the Bank of Ghana 2025 financial statement was just published, and it transparently presents the cost of doing business with high inflation and high interest rates,” Dr. Atoyan stated during an interview on PM Express Business Edition.
He elaborated that the central bank’s efforts to absorb excess liquidity from the financial system, a key tool for managing inflation, inevitably came with a financial price. “Absorbing liquidity from the market is costly, and that’s what we see as reflected in the statement,” he added.
Balancing Short-Term Costs with Long-Term Stability
While acknowledging that these operations weakened the Bank’s balance sheet in the short term, Dr. Atoyan maintained their necessity for achieving long-term economic stability and restoring confidence. “Yes, so it did generate some costs for the Bank of Ghana, but it was a necessary cost for the stabilisation going forward,” he stressed.
The IMF Mission Chief pointed to the visible positive results of these policy measures in the broader Ghanaian economy. “I think people on the ground actually recognise that,” he remarked, suggesting that the public is experiencing the benefits of the stabilization efforts.
Bank of Ghana’s Policy Stance
In recent years, the Bank of Ghana has adopted a tight monetary policy stance. This includes maintaining high interest rates and conducting significant liquidity absorption operations. These measures are central to its strategy to combat inflation, stabilize the national currency (the cedi), and rebuild macroeconomic confidence.
The aggressive approach was deemed essential following Ghana’s economic crisis and its subsequent debt restructuring program. The central bank’s actions reflect a commitment to anchoring inflation expectations and ensuring a more stable economic environment for businesses and citizens alike.
Future Outlook and Implications
The IMF’s defense of the Bank of Ghana’s financial performance suggests a continued endorsement of the central bank’s current policy direction. As Ghana works towards sustained economic recovery, the focus will likely remain on balancing the immediate financial costs of stabilization with the imperative of achieving lasting macroeconomic stability.
Readers and industry stakeholders will be watching closely to see how the Bank of Ghana navigates these financial challenges while continuing its efforts to control inflation and foster economic growth. The interplay between monetary policy actions, central bank balance sheet health, and overall economic recovery will be a key area to monitor in the coming months and years.
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