The Bank of Ghana (BoG) has justified the construction of a new headquarters, revealing that its current head office is no longer fit for purpose.

According to BoG, the outcome of the structural integrity work was that the main building does not satisfy the full complement of excess strength required for a building to be considered safe for usage. This, it indicated, means that in the case of a worst-case gravity and wind loading scenario, for example, unusually strong wind, the building may be significantly affected.

“A structural integrity assessment conducted revealed that the current BoG Head Office building, built by the Nkrumah Government in the early 1960s, is no longer fit for purpose and could not stand any major earth tremors…”
Bank of Ghana

Reacting to the statement by the National Democratic Congress (NDC) which accused the Bank of Ghana of building a new head office at an alleged amount of $250 million, BoG stated that the building also does not have the required strength to withstand the expected imposed significant earthquake loads that would be expected to occur in the Accra area. Based on this, it explained that looking at the strategic objective of positioning Ghana as the financial hub of the subregion, with prospects of a potential Headquarters for a future regional Central Bank, it was agreed that a new headquarters was needed.

“The Board and Management of the Bank considered a new Head Office building as the most important priority project to support the operational efficiency of the Bank, and also position the Bank of Ghana in a very good position to be the host of the regional Central Bank as we currently host the West African Monetary Institute (WAMI) of the Sub region.”
Bank of Ghana

BoG vehicle maintenance budget

On the issue of waiver or write offs without recourse to Parliament as per section 53(1) (2) of the PFM Act, the Central Bank highlighted that its 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.

In light of this, it noted that any further discussion on parliamentary approvals beyond what was approved in the 2023 budget would be handled by the Ministry of Finance.

Additionally, BoG revealed that 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 not stop an ECL application and impairments on the books of BoG. And lastly, on this point, the Minister has followed up on his intentions and has submitted a letter to the Bank of Ghana detailing out 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.”
Bank of Ghana

Touching on the vehicle maintenance expenses, BoG indicated that the line is a generic name for expense covering fuel cost for all BoG operations, insurance of all BoG fleet of vehicles, car parts replacements, and other maintenance cost. Historically, it explained that fuel cost had accounted for about 90% of the vehicle maintenance expenses expenditure line.

“For 2022, the fuel cost increased by 123.3 percent compared to 28.9 percent in 2021. This was on the back of petrol and diesel prices increasing from GHC6.6618 per liter of petrol, and GHC6.665 per liter of diesel at the end of 2021 to GHC 16.5811 per litre of petrol and GHC19.6053 per liter of diesel at the end of 2022. This implies increases of 149% (Avg. 87%) and 194% (Avg. 122%).”
Bank of Ghana