Just three months into the new dispensation for Ghana’s universal banking industry, First Atlantic Bank has shown the potential created by restructuring done by the Bank of Ghana over the past one and a half years. First, Atlantic Bank has the target of becoming one of the top-five banks in Ghana’s fiercely competitive commercial banking arena – but many industry pundits believe this can only be achieved over the long-term.
The first quarter of 2019 financial statements now being released by banks in Ghana will now force a rethink by banking industry analysts. First Atlantic Bank is providing a lesson in how to win the confidence of the banking public by showing how to conduct oneself so as to become a preferred option for both financial intermediation and consummation of financial transactions.
This is translating into phenomenal growth for the bank.
Most importantly, First Atlantic Bank is far more financially solid than it has ever been before; and indeed its financial muscle matches the biggest available to institutions and households in Ghana. Following its merger with Energy Commercial Bank at the turn of the year, First Atlantic Bank now has GH¢409million in core stated capital, which is comfortably more than the GH¢400million statutory minimum now in force.
This supports total assets, as at the end of the first quarter of 2019, of GH¢2.1billion, which is instructively 31% more than the balance sheet size as at the end of 2018.
This has been funded in part by a 19% increase in deposits over the 12-month period to end of March 2019 to GH¢1.6 billion, which reflects the confidence its customers have in its financial solidity as well as the sheer customer-focus of all its activities.
That confidence is being repaid in other ways, too; most particularly by the bank’s commitment to providing financial support for its customers. By the end of the first quarter of 2019, First Atlantic Bank had outstanding loans and advances with its customers to the tune of GH¢546million – this being up 58% on size of the loan book one year earlier.
Bigger business volumes are translating into bigger profitability and, crucially, First Atlantic Bank is throwing its rewards back into its activities – especially the expansion and strengthening of its product and service distribution channels. The bank’s profit before tax for the first quarter of 2019, was GH¢10.2million, up 76% on the pre-tax profit for the corresponding period of 2018. This was achieved on operating income of GH¢58.9million, up from the GH¢42.9million generated during first quarter of last year.
Importantly, net interest income grew by 56% to GH¢33million, the reward for lower cost of funding – which in turn resulted from prudent financial management and rising confidence by an increasingly discerning banking public. Their appreciation of the sheer quality of First Atlantic Bank’s product and service delivery is illuminated by a 20% increase in the bank’s income from commissions and fees – which rose to GH¢26million for the first quarter of 2019, up from GH¢21.7million over the corresponding period of 2018.
The key to First Atlantic Bank’s superior service quality lies with its excellent distribution channels resulting from a deep understanding of the customer and economic operating environment, backed by heavy investment in delivery channels.
First Atlantic Bank now has 41 branches spread across six regions nationwide. Even more importantly, the bank has heavily enhanced its digital banking platform and now offers seamless and completely secure Internet banking – including mobile foreign currency transactions. The bank currently runs 65 ATMs and is at the forefront of facilitating e-commerce too, having deployed 260 point of sales devices so far.
All this points to a bank that has equipped itself to thrive in the banking industry. Indeed, First Atlantic Bank is moving faster toward its ambition of ranking among the top-five banks in Ghana.