Finance Minister Advocates for Asset Sales to Recapitalize Bank of Ghana

Finance Minister Dr. Cassiel Ato Forson has urged the Bank of Ghana to sell assets for its recapitalization, dismissing the use of taxpayer money. He stressed the need for internal solutions, including expenditure cuts and the divestiture of non-essential properties, to address BoG’s financial issues without burdening the public. The government seeks a proactive financial strategy from the central bank.

In an emphatic statement, Finance Minister Dr. Cassiel Ato Forson has firmly ruled out the use of taxpayer funds to recapitalize the Bank of Ghana (BoG). He has emphasized that the central bank should seek internal strategies, including the divestiture of certain assets, to address its financial challenges. This position follows the revelation that BoG had previously engaged in an agreement to secure a GH¢53 billion bailout, which is no longer feasible given the government’s fiscal constraints.

During an interview on Joy News’ PM Express, Dr. Forson highlighted the importance of self-sufficiency for BoG, citing a significant financial deficit amounting to ¢60 billion. He expressed concerns regarding the bank’s unhealthy balance sheet and negative equity generated from its debt accumulation, reinforcing the necessity for BoG to manage its expenditures prudently without relying on public funds.

Dr. Forson directed BoG to explore avenues for expenditure reduction, insisting that taxpayers should not bear the burden of a GH¢53 billion recapitalization. He criticized the bank’s costly recent initiatives such as the construction of its new head office and proposed that selling and leasing the property could generate necessary capital.

In addition, he recommended that BoG divest from its hospitality assets, such as hotels and guest houses, to bolster its financial position. He stated, “They should sell some of them and use the money to recapitalize. The taxpayer cannot be used as a punching bag.”

The Finance Minister asserted that allocating taxpayer money to support BoG would detract from funding essential public services, questioning the affordability of such a significant allocation. He remarked, “Giving ¢53 billion to the central bank will simply mean that we will have to deny the taxpayer some public good, like roads, like schools, like hospitals.”

Dr. Forson indicated a willingness to negotiate with BoG should it present a credible plan for addressing its fiscal situation internally. He suggested a gradual reinvestment of profits over the next decade as a means of achieving stable recapitalization, indicating that the government expects proactive steps from the central bank moving forward.

In conclusion, Finance Minister Dr. Cassiel Ato Forson has reiterated that the Bank of Ghana must seek internal solutions for its financial troubles rather than relying on taxpayer funds. By proposing asset sales and expenditure cuts, he emphasizes the need for fiscal responsibility. This strategic direction underscores a broader commitment to safeguard public resources for essential services. The upcoming measures taken by BoG will be closely monitored as they navigate this challenge.

Original Source: www.graphic.com.gh