The Ahafo Community Bank at Kukuom in the Asunafo South District of the Brong Ahafo Region posted growth in all the performance indicators during the 2017 year under review.
The bank recorded an impressive increase of 886.82% in profit before tax from GH¢35,005 in 2016 to GH¢345,437 in 2017, while total assets grew by 19.23% from a little over GH¢10.67 million to approximately GH¢12.80 million.
The capital adequacy ratio of the bank stood at 15.55%, showing an excess of 5.55%. Primary reserves went up from 8.45% to 15.21% as against the Bank of Ghana’s minimum requirement of 8%. Secondary reserves on the other hand, appreciated to 36.52% which is slightly above the industry requirement of 30%.
The sum of investments in treasury bills and other forms of short term securities in the year was GH¢5.17 million as compared to GH¢4.34 million in the year before, increasing by 19.04%. Accumulated deposits during the year under review was GH¢9.68 million, indicating a marginal growth of 6.74% from GH¢9.07 million in the previous year.
Total advances increased by 22.99% from GH¢3.07 million to GH¢3.45 million. The stated capital of the bank surged from GH¢322,410 to GH¢676,620. Notwithstanding the significant increase, it fell short of GH¢323,380 to the BoG minimum capital requirement of GH¢1 million.
The Board Chairman of the Bank, Rev. Kofi Sakyi, announced these at the 19th annual general meeting, held at Kukuom.
He said due to the bank’s inability to meet the capital requirement, the Directors were unable to recommend payment of dividend and urged owners of the bank to expand their holdings to prevent a takeover or merger, which will defeat the sovereign interest of promoters as well as the owners.
The Ahafo Community Bank like many other banks, the Board Chairman indicated, has to battle with non-performing loans. He said: “last year, the bank had to charge GH¢80,722 as bad and doubtful debt which poses a great liquidity challenge for the bank. The bank will therefore adopt proactive steps in the years ahead to ensure a brighter future. We’ll ensure good corporate governance, compliance with statutory requirement of BoG and ARB Apex Bank directives and improve customer care and provide quality services.”
In an interview with B&FT, Mr. Pobi Antwi Donkor, General Manager of the Bank, was very optimistic that it was going to meet the minimum capital requirement, latest by December 2018. Some investors, including the Paramount Chief of Kukuom Traditional Area, Osahene Kwaku Aterkyi II, he noted, have shown keen interest in injecting fresh capital into the bank and they are expected to release an initial sum of about GH¢350,000 before the year ends, followed by huge subsequent injections.
He said the bank has repackaged some of its products, especially loan schemes for petty traders and farmers, who form the core of the bank’s customer base. “Previously, the minimum number for group loan was 15 people but we have reduced it to 5 people, focusing on women. This is to ensure effective monitoring and management of loanees to reduce default.”