- records over 371% in profit margin
East Akim Rural Bank Ltd. has recorded an impressive growth by making its first profit since 2018, with an over-300 percent increase in its net profit after tax.
The bank recorded profit before tax of approximately GH₵331,325 as against a loss of GH₵152,560 in the previous year, signifying 317 percent profit after tax of approximately GH₵328,222 as against a loss of GH₵151,344.00 in the previous year.
This feat was attained as a result of good measures put in place by the Board and Management, like embarking on a loan expansion drive by expanding the outreach of Micro Finance Loans (the Ntoboa Loan) to market women, and the Agric Loan to gallant cocoa and vegetable farmers in the bank’s catchment area and beyond.
This exercise saw more women and cocoa farmers gaining access to loan products, thus helping to improve their businesses and personal lives. The above-mentioned products contributed to the increase in the bank’s total portfolio from approximately GH₵3.1million to a little over GH₵6.9million, representing an increase of 123.63%.
|ITEMS||2020||2021||% CHANGE 2020/2021|
|Loans and Advances||3,101,707.00||6,936,346.00||123.63|
|Investment in Securities||1,384,627.00||1,184,549.00||(14.45)|
|Profit /Loss before tax||(152,560.00)||331,325.00||317.18|
|Total Operating Income||1,255,287.00||3,034,812.00||141.76|
|Net Profit /Loss after tax||(151,344.00)||328,222.00||316.87|
The chairman of the Board of Directors of the bank, Emmanuel Adusei – whose report was read on behalf of the Vice-Chairman Jonas Amponsa Asamoah, said these and more at the bank’s 4th Annual General Meeting at Osiem in the Eastern Region.
The bank also sponsored the Best Vegetable Farmer at the 37th Farmers Day held on the 1st Friday of December 2021 at Abuakwa North Municipality.
The board chairman expressed optimism that with the feats chalked up during the year under review, the bank’s future is bright and they envisage better products and services to customers, compliance with regulatory requirement, prudent measures for profit maximisation and extending their office outlets to other vantage points.
The bank looks forward to installing an Automated Teller Machine (ATM) to enhance service delivery for their cherished customers.
With the Ghana Card’s introduction as the only card a customer can transact business with as a regulatory directive by the Bank in Ghana, we hope to strengthen monitoring of our loans and improve on our Loan Recovery. This will also help minimise fraud and multiple borrowings in the banking sector.
The bank intends to roll-out new products called the Church and Educational Development Loan Product and ‘Sika Dwatire’ Susu Loan Product onto the market to help SMEs in the bank’s catchment areas.
As part of measures to digitise the bank, management intend to rope-in as many customers and non-customers as possible on the GhanaPay platform – where they can deposit as well as withdraw money from their account using the GhanaPay platform of the bank.
Managing Director, ARB Apex Bank, Alex Kwasi Awuah, commended the East Akim Rural Bank for their consistency in performance during the year under review.
Giving details on GhanaPay, Mr. Awuah noted that the ARB Apex Bank is adopting key strategies to get all their registered members to be on the platform.
He further encouraged RCBs to leverage this new service to issue wallet accounts for existing and new customers, as well as set up bank agents. All one requires to register for the service is the Ghana Card and a GPS address. He added that it offers the regular Mobile Money free except for the E-levy.
Mr. Awuah also said that the Board of Directors of ARB Apex Bank has approved a new four-year Strategic Plan that allows them to raise GH¢25million over a five-year period in equity from member RCBs, which happen to be the sole shareholders of ARB Apex Bank.
In that regard, there will be an Extra-ordinary General Meeting (EGM) to enable all shareholders take a decision to help raise the capital.
He expressed confidence that: “As we are commencing this strategic crusade at the 4th AGM of East Akim Rural Bank, shareholders and directors will support the initiative. We will begin a sensitisation drive on this very soon at the Regional Chapter meetings of the Association of Rural Banks”. Mr. Awuah urged them to help to achieve this noble objective so that rural banks can together build a formidable ARB Apex Bank going into the future.
He mentioned that employee-fraud has been identified as a threat in the banking sector. According to the 2020 fraud report released by the Bank of Ghana: “In 2020, many routine activities of institutions – including financial transactions that usually would have been undertaken in-person – were conducted online”.
Customers who were not used to digital/electronic methods of making financial transactions were compelled to use them. Consequently, some sections of the banking sector were exposed to heightened levels of fraud-related risk due to the increased patronage of electronic/digital products and services occasioned by emergence of the COVID-19 pandemic.
The report concluded: “The banking sector has become more susceptible to fraud due to the increased use of innovative emerging technologies for business transactions. 2020 recorded a marginal increase in reported fraud incidents and a marginal decrease in losses incurred. At our RCBs industry level, cash suppression by our staff remains a significant challenge as identified in the report. I humbly plead with all CEOs to ensure that cash suppression and MoMo fraud are minimised in our banks”.