Abokobi Rural Bank Records Profit

The Abokobi Area Rural Bank, a pioneer rural bank in Ghana, achieved a 519.99 per cent increase in profit before tax in 2012 after it emerged from deficit in 2010.

The bank ended its financial year with a profit position of GH¢306,108.00 up from GH¢58,868.00 it earned in 2011. The ARB Apex Bank, the umbrella body of rural banks, has attributed the increase in profit to effective and efficient management of its resources.

Although the bank posted substantial increases in deposits and assets and thus declared a dividend of 3.32 pesewas per share, the Board Chairman, Nii Afutu Brempong III, at the bank’s 2013 annual general meeting at the weekend, said its stated capital growth moved in a snail pace, and this is a concern for management.

With a marginal increase of 1.46 percent in stated capital at GH¢185,266.00 in 2012, he said, records showed that about 90 percent of shareholders owned less than 1,000 shares, which was not encouraging given the bank’s recent performance.

“What is more disturbing is the fact that most of us bought our shares at the initial rate of GH¢0.01,” and this, he said, compelled the bank to fall on its reserve for expansion and other capital developments for the operating year. The bank, therefore, at its well-attended AGM, launched a special share mobilization programme aimed at raising its stated capital to GH¢500,000.00.

But the shareholders in response to the call to increase holdings, during discussion of the financial report, equally accused the present directors of the board, saying many of them had very low number of shares in the bank, hence the low interest from the ordinary shareholder.

Nii Brempong III said competition on the financial market was becoming more and more serious, which called for expansion in infrastructure, creation of attractive products, development of human resource capacity with attractive rewards and the projection of the bank’s name and image through regular advertisements.

Appealing further to the existing shareholders, he said, “now that your bank is on the ascendancy to reach the skies, do not let outsiders take control of the bank by their acquisition of shares. We give you the first option.” The bank’s total assets grew by 32.51 per cent from GH¢5,074,890 in 2011 to GH¢6,724,550 in 2012 with its time deposits and savings growing from GH¢514,917 to GH¢820,411 and from GH¢2,428,558 to GH¢3,077,791 respectively.

In the near future, the bank intends to open more branches, expand its microfinance programme, repackage its Susu scheme, provide mobile banking services, intensify loan recovery and build the capacity of the bank’s staff.

Source: GNA