- Embarks on strategic interventions for banking excellence
- Records 482% growth in profit
The ARB Apex Bank Limited – a mini-central bank that offers support services to the rural and community banks in Ghana – has recorded an impressive operational performance in the 2020 year under review.
The bank, notwithstanding the prevailing economic and social difficulties, put up an impressive performance – increasing its total operating income by 16% from GH¢64.96million in 2019 to GH¢75.3million in 2020 and recording profit before tax of GH¢5.9million, representing a whopping 482.4% growth from GH¢1million in the previous year.
Total assets of the bank recorded significant growth of over 29%, from GH¢582.4million in 2019 to GH¢751.9million in 2020. Deposits grew by 32.6% from GH¢488.9million in 2019 to GH¢648.5million in 2020 – with corresponding growth of 62.2% in Investments rising from GH¢258.3million in 2019 to GH¢418.9million in 2020.
Apex Bank continued to invest heavily in infrastructure to support the smooth-running of RCBs. Besides the US$8million funding from the Ministry of Finance and World Bank, the Board has recently approved an additional US$1.2million to support upgrading the Data Centre and the Disaster Recovery site to avert any interruption in the operations of RCBs.
These and more were contained in an address delivered by the Chairman of the Board of Directors, Dr. Toni Aubynn, at the Bank’s 19th Annual General Meeting held virtually recently.
According to him, the banking sector’s performance remained strong at the end of 2020; with robust growth in total assets, deposits and investments.
The increase in total assets resulted in strong growth of investments in government securities. Total deposits recorded significant year-on-year growth, reflecting strong liquidity flows emanating from the COVID-19 fiscal stimulus and payments to contractors.
Overall, the pandemic’s impact on the industry’s performance seems moderate, as banks remained liquid, profitable and well-capitalised. A series of policy and regulatory measures were put in place by the Bank of Ghana to loosen financing conditions, ease liquidity pressures and keep credit flowing to support critical sectors of the economy.
These measures – including a reduction in the Policy Rate by 150 basis points; lowering the primary reserves by 200 basis points; and dropping the Capital Adequacy Ratio by 150 basis points – were not only helpful but timely.
The rural banking sub-sector also recorded some significant improvements in the year under review, with total assets growing by 33.3% year-on-year from GH¢4.2billion to GH¢5.6billion at the end of September 2020. Deposits rose from GH¢3.4billion in September 2019 to GH¢4.8billion as at September 30, 2021. Loans and advances recorded an increase by 15.6% from GH¢1.4billion to GH¢1.7billion.
By these favourable macroeconomic conditions in the business environment, coupled with an unprecedented pandemic that pertained during the reviewed year, the bank managed to pull yet another remarkable operational performance in all the financial indicators for 2020.
Strategic Interventions for Banking Excellence
The Managing Director of the Bank, Mr. Kojo Mattah, in an address outlined some strategic interventions embarked upon by the Bank which have improved banking excellence. Notable among these are included: Investment in ICT, Cyber Security Solutions Deployment; and an Agency Banking Project which has hit its advanced stage; as well as the Improved Image of ARB Apex Bank and RCBs, and a collaboration with key and relevant institutions with the primary objective of generating business for rural and community banks.
According to Mr. Mattah, the Apex Bank continued to invest heavily in ICT, which has become the key business enabler all over the world. “Today, we boast a modern ICT backbone that is helping us develop innovative customer-centric products for our customers,” he stressed.
He mentioned that the Data Centre upgrade being funded by the World Bank has been completed, and that RCBs can attest to the vast improvement in service turnaround time on the network, and the improved real-time communication between RCBs and Apex Data Centre as well as the Disaster Recovery Site.
The Ghana Financial Sector Development Project (GFSDP), which is being implemented to improve and strengthen the financial sector by government under World Bank project financing, has approved a contract to be awarded for the implementation of four major cyber and information security requirements as stipulated in the Bank of Ghana Cyber Directive.
This contract, according to Mr. Mattah, will offer ARB Apex Bank and RCBs maximum protection and secure all access to database applications in use for all critical applications: like T24, CCC-ACH, SWIFT, iTrans among others.
The project will also protect, secure and segregate all access to existing local and wide area networks; provide a third layer of security on accessing all applications on the Bank’s network through the use of software and hardware tokens; and also protect and secure local and external networks against hackers. This system, he said, will provide ARB Apex Bank real-time information on the type of attack and where it is being originated from.
Mr. Mattah announced to shareholders that the Agency Banking project – being feasibility study and business modelling – has been completed and they are in the process of selecting a service provider to support deployment of the shared Agency Banking platform, which is expected to sign-up at least 5,000 Bank Agents. This, he said, will lead to the launch of this novel project in the RCBs sub-sector – bringing in a never-before-seen revolution in the rural economy of the country.