By Elorm Desewu
The Bank of Ghana, (BoG) plans to auction US$120 million to the Bulk Oil Distribution Companies (BDCs) in the first quarter of 2025.
This is to enable them get enough forex for importation of crude oil into the country as the government has temporally suspended the Gold for Oil Program.
According to BoG’s Forex Forward Auction Calendar, the central bank will auction US$40 million to the BDCs in each month of the first quarter of 2025.
In each of the months in the first quarter, the BoG will auction US$20 million every fortnight to meet the dollar demands of the BDCs
According to the Bank of Ghana, the said amount is going to be sold at the Foreign Exchange Forward Auction in accordance to its auction guidelines.
Last year, the central bank gave authorisation to nine forex brokers in the country to operate on the Ghana Interbank forex market effective January 01, 2024 to December 31, 2024.
They are Black Star Brokerage, CSL Capital, Fenics MD, ICAP African Brokers Ltd, Obsidian Acherner, Regulus, Sarpong Capital, Savvy Securities and Terika Financial Services Ltd.
This is in line with Section 3.13.1 of the Ghana Interbank Forex Market Conduct rules which stipulates; “local and International Foreign Exchange (FX) Brokers who want to operate in Ghana’s forex market are required to obtain prior approval from the Bank of Ghana at the beginning of every calendar year” it said in a statement issued and signed by the Secretary of the BoG, Ms. Sandra Thompson.
According to Bank of Ghana, it reserves the right to delist any authorised FX broker for nonperformance or non-compliance with the FX Act and the Interbank FX Market Conduct rules. An FX broker is to particularly note that “it shall not deal directly with a corporate entity; it shall not also buy or sell foreign exchange for its own account nor hold, borrow or lend foreign exchange to an authorised market participant”.
A statement from the Financial Markets Department of BoG said on each trading day, authorised FX brokers shall be required to send to the BoG an interim report mid-day and end of day report when the market closes and should cover pricing and volumes. This report shall be sent to fxbrokers@bog.gov.gh; FX brokers shall adhere to all applicable requirements under the Ghana Interbank FX Market Conduct rules.
The Bank of Ghana (BoG) shall impose penalties and/or revoke authorisation if any FX broker is deemed to have deviated from any of the Ghana Interbank FX Market Conduct rules; an FX broker shall apply for a renewal of authorisation as an FX broker in Ghana by the end of the first working week of December of every calendar year; restructuring of the FX broker, e.g. mergers, takeovers and any other significant changes (e.g. change of company name, etc.); must be reported to the BoG without delay.
In the event of restructuring and/or changes to the FX brokers’ regulatory status, proof must be provided that the regulatory authority has either approved or has not objected to such changes; An FX broker shall not take the other side of customer trades, nor should the trade be outsourced to any single third party who can skew the price according to their own trading book.
It said, If the counterparty makes its own price, then the FX broker should seek a best price from a reasonable array of wholesale market makers and an FX broker shall not deal directly with a corporate entity, it shall not also buy or sell foreign exchange for its own account nor hold, borrow or lend foreign exchange to an authorised market participant.
An FX broker must have a robust system in place with the required safeguards against cybercrime and other forms of internet or other technology threats in line with the Bank of Ghana’s Cyber Security Directives; and also an FX broker shall quote exchange rates that are based on actual transactions within the domestic economy in Ghana and may be required to provide evidence of that as deemed necessary.
