AMENFIMAN Rural Bank Limited at wassa Akropong in the wassa Amenfi East District in the western Region is to establish a university college in the Amenfi State with the support of chiefs and other influential personalities.
The bank has made an impressive operational performance in the 2016 year under review.
As first step, the bank has commissioned a technical assessment of the project and the preliminary feedback has been positive.
The board has proposed an additional 10 percent profit after tax annually to fund this project. This makes the bank’s total contribution to corporate social responsibility 15 percent of the profit after tax.
The Chairman of the Board of Directors, Dr Tony Aubynn, announced this at the bank’s 33rd Annual General Meeting held recently at the assembly hall of Amenfiman Senior High School at wassa Akropong.
Macroeconomic & political environment
According to Dr Aubynn, Ghana’s economy experienced slow growth during the year under review against the backdrop of the IMF fiscal consolidation programme and rising debt.
With a GDP growth of 3.9 percent from 3.4 percent in 2015, general economic activities in the country could best be described as modest.
The national economy experienced some inflationary and exchange rate challenges as inflation peaked at 19.2 percent, even though the country managed to end the year at 15.4 percent.
The 9.6 percent depreciation of the dollar, which is a major trading currency, also affected the prices of goods and services in the country.
Similarly, the run-up to the 2016 general election created a lot of uncertainties in the business community.
Rural financing agenda
The bank’s quest to remain leaders in rural financing is on course as management continues to increase access to credit to micro, small and medium enterprise (MSMEs) and farmers in the rural communities. This according to the chairman, is helping to boost economic activities and development in the bank’s operational communities.
During the year under review, a total of GH¢64 million (out of a Proposed GH¢66 million) was give out as loans to micro, small and medium enterprises in the bank’s operational areas.
Meanwhile, the Amenfiman Rural Bank has earmarked an amount of GH¢80 million for farmers and MSMES in its communities in 2017. Its special farmers loan scheme is doing well and so the Board has approved an expansion to cover all farmers. This will be its modest support for the government’s programme of using agriculture to underpin Ghana’s growth and development.
It posted a pre-tax profit of approximately GH¢9.98m in 2016 as against a little over GH¢5.5m in the previous year, representing a remarkable growth of 78 percent. Bank official say it is the highest profit so far recorded in the rural banking industry, judging by the financial report of all rural banks in Ghana whose 2016 audited accounts have been made public.
This comes with improved revenue generation raising total income from a little over GH¢21.2 million to approximately GH¢30.4m, which is a significant improvement in the bank’s income generation activities, and it reflects the careful execution of strategy during the year under review.
The bank’s total deposits grew significantly from GH¢87.3 million to GH¢128.8 million in the 2016 year under review, representing 47.5 percent of the 2015 performance, even though government domestic borrowings resulted in high interest rates on treasury bills during the year under review. This was as a result of the hardworking staff members and the mobilisation drive pursued by management and staff.
Payment of dividend
In line with the Board of Directors’ decision to ensure that the financial returns to shareholders of the bank continue to grow, it has proposed a dividend payment of GH¢0.060 per share, amounting to GH¢593,132.12 in monetary terms.
The chairman assured shareholders that the board would continue to make decisions and investment that would be in their best interest.
In line with its policy to pay appropriate financial returns on shareholders investment as the business continues to grow, the board has proposed an increase in dividend per share from GH¢0.050 per share to GH¢0.060.
This, according to the board chairman, is a reflection of the bank’s growth and in line with its general philosophy of distributing the benefits of its success to stakeholders.
Dr Aubynn also said the rate of return was significantly higher than market rates, especially at a time when Government of Ghana treasury bills are around 12 percent per annum. He therefore, encouraged all current shareholders and prospective investors to consider Amenfiman Rural Bank as their investment destination.
The Chief Executive officer of the bank, Dr Alex Asmah, said its business focus in 2017 was on driving growth, innovation, efficiency and service as the main pillars in achieving profitability and market leadership in 2017.
The bank’s business model, according to the CEO, is still tailored for the MSMEs and will push for more market penetration as they develop new and better products and trusted relationship with clients of the bank.
He disclosed that the bank had already begun the installation of ATMs at the various branches and would soon roll out other electronic channels for the benefit of the cherished customers of the bank.
Regulator advice – ARB Apex Bank
The Deputy Managing Director of ARB Apex Bank Limited Mr Alex Kwasi Awuah, adviced shareholders, particularly those who would like to serve on the board, to cast off the habit of peddling falsehood about the bank as well as making unproductive criticism.
According to him, banking thrives in a credible and dignified environment and so such act may put depositors off and may lead to panic withdrawals that might collapse the bank.