On April 1, 2021, Bank of Jamaica (BOJ), in accordance with the Bank of Jamaica Act, made a distribution to the Government of Jamaica (GOJ) of $32.6 billion from accumulated profits for the period 2018-2020 less unrealised gains as at December 31, 2020. Such a transaction is already routine for many modern central banks but, for Jamaica, appeared significant because it was unprecedented.
This article sheds light on the sources of these profits and important features of BOJ’s future financial relationship with the GOJ.
HOW ARE BOJ PROFITS GENERATED?
As with any other entity, BOJ profits are the residue of income from operations after deducting the recurrent expenses incurred in generating that income over a given reporting period.