Bosomtwe Rural Bank signs onto GDPS to protect depositors

From left – right: Fred Asafu-Adjaye, Director; Prof. Oteng Adjei, Director; Philip Edward Kwabena Antwi Esq, Board Chairman; Benjamin Osei-Boateng Esq, Vice-Chairman

Bosomtwe Rural Bank Limited at Kuntanase in the Bosomtwe district of Ashanti Region has signed onto the Ghana Deposit Protection Scheme that was established by the Ghana Deposit Protection Act 2018 (Act 968).

The primary objective of signing onto the scheme seeks to protect small depositors from loss incurred by them as the result of an insured event’s occurrence.

Directors of the bank are of the view that the interests of depositors have become paramount, and believe that the decision to sign onto the Deposit Protection Scheme will go a long way in boosting public confidence.

Chairman of the Board of Directors, Philip Edward Kwabena Antwi Esq, whose address was delivered by Benjamin Osei-Boateng Esq, Vice-Chairman, made this known during the bank’s 29th Annual General Meeting of shareholders held yesterday at Kuntanase in Ashanti Region.

According to him, the bank registered satisfactory growth in almost all financial indicators despite the unfriendly and challenging macroeconomic environment in which the bank operated during the 2018 period under review.

The macroeconomic indicators of the Ghanaian economy improved in 2018 – with exception of the cedi which consistently depreciated against all the major trading currencies; and this did not in fact favour businesses as expected.

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Inflation rate as at the close of business 31st December 2018 was 9.4% as against 11.08% in the year 2017, with a government of Ghana Treasury bill rate of 14% in 2018 as against 13% in 2017.

In spite of the challenging macroeconomic and political environment that pertained during the reviewed year, the bank managed to pull yet another satisfactory operational performance in almost all financial indicators in the 2018 year under review, as shown in the table.

The bank’s paid up capital was about GH¢3.63million as at 31st December 2018, and has further increased to about GH¢3.8million as at the close of business 31st July 2019. The amount far exceeds Bank of Ghana’s minimum threshold, and is about 280% more than the minimum GH¢1million required to be achieved by all rural banks before February 2020.

New share purchases solely accounted for this significant increase of GH¢1,579,687. The Board and Management have appreciated shareholders of the bank for their immense contribution in growing its capital base.

However, the Board is unable to recommend payment of dividend. This, according to the board chairman, is because they have become duty-bound to uphold prudential guidelines from the Regulator, implementation of International Financial Reporting Standards (IFRS), coupled with the financial sector meltdown and need to build the Bank’s liquidity buffers.

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 The bank continues to offer assistance to communities and institutions within its catchment areas, in terms of community development projects and financial support which amounted to GH¢33,900. The major economic areas that benefitted included Education, Health, Sports and Recreation and Security.

The Chief Executive Officer of the bank, Mr. Francis Agyei Bekoe, in an interview with B&FT said the bank’s business focus in 2018 ws on driving growth, innovations, efficiency and service as the main pillars in achieving profitability.

According to him, signing onto the Ghana Deposit Protection Scheme is one of the steps the board has taken to build public confidence in the bank. He is of the view that this step will better-position the bank, particularly at this time when public confidence in the banking sector has waned.

He emphasised that the bank will continue to pursue massive share and deposit mobilisation; follow stringent cost-reduction policies; strengthen internal control measures; and develop the human capital to meet the demands of functioning profitability in this competitive banking environment.

 

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