BoG Losses Hit GH¢15.6bn as Gold-for-Oil Collapse Adds Pressure
The Bank of Ghana's 2025 loss is bigger than the headline. GH¢15.6 billion net loss, up 66% from 2024, is bad enough. But the real number is negative equity of GH¢96.3 billion. That is not a temporary dip. It is a structural hole.
CERPA's policy brief calls the trend a 'deepening structural challenge'. They are right. The loss comes from two things: debt impairments on the central bank's domestic bond holdings, and the now-dead gold-for-oil programme.
Gold-for-oil: a GH¢2bn policy failure
The gold-for-oil programme was supposed to stabilise fuel prices and reduce dollar demand. Instead, it incurred over GH¢2 billion in losses. According to Business Insider Africa, the programme was terminated in March 2025 after a board meeting on March 13. The central bank was swapping gold for fuel at below-market rates. The subsidy gobbled up reserves.
This matters for investors because it shows policy risk. The government created a quasi-fiscal operation outside the budget. When it failed, the central bank ate the loss. That erodes trust in BoG's independence and its ability to manage the cedi.
Negative equity and IMF programme risks
The NDC Majority Caucus argued that the GH¢96.3 billion negative equity 'must not be interpreted through a narrow lens of commercial banking' (per Graphic Online). They claim the loss is tied to economic stabilisation. That is partly true. Central banks in distressed economies often take losses from exchange rate subsidies and debt purchases. But the scale is unusual.
A central bank with negative equity cannot pay dividends to the government. The fiscal deficit gets wider. The bank also has less credibility when it tries to tighten monetary policy. The cedi will remain under pressure.
Ghana is in the middle of a three-year Extended Credit Facility (ECF) programme with the IMF. The programme assumed the central bank would return to profitability eventually. That assumption now looks optimistic.
Expect the IMF to demand deeper fiscal consolidation or a recapitalisation of the central bank. Either option hurts. Recapitalisation would mean issuing more bonds, adding to the debt stock. The debt restructuring from 2024 to 2025 may not be the last. The risk is that Ghana's sovereign bond yields stay elevated. Investors already priced in a restructuring. But a second restructuring or a prolonged IMF programme keeps the country in 'distressed' status longer.
The Bank of Ghana has a damaged balance sheet. The gold-for-oil collapse is a warning about policy execution. The negative equity limits the bank's room to act. For investors, this means higher risk premiums on Ghana assets and slower recovery. Watch for the next IMF review. It will reveal whether the government can stabilise the central bank's finances or whether more adjustments are coming.