- posts 156% growth in profit
- pays 40% of profit available for distribution as dividend
By Seth KRAMPAH, Fomena
The Adansi Rural Bank PLC at Fomena in the Adansi North District of Ashanti Region has held its 34th Annual General Meeting of shareholders and posted another impressive growth in all financial indicators for the 2023 year under review.
The bank recorded a profit before tax of a little over GH₵ 6.2 million as against GH₵ 2.4 in 2022 representing an impressive growth of 155.93% which translates to GH¢3,77,358 in absolute terms.
The bank’s Management Performance Review as at July 2023 has revealed a profit before tax of about GH¢9.1million with deposit of about GH₵ 288 million. This is a significant performance and therefore the Board and Management are doing everything possible to ensure sustained operational efficiency to end the year well to give value to shareholders.
By this, existing shareholders and prospective ones have been urged to buy an buy more shares to set the Bank’s growth pattern on the long-term objective of making positive impact in the communities they operate.
Additionally, the Board of Directors has proposed a total Dividend payment of GH₵1,397,089.02. This represents 40% of the Profit available for distribution, after the Statutory Reserve requirements which translates into a dividend-per-share of GH₵ 0.03.
This Dividend proposal has been approved by the Bank of Ghana and would be 200% above that of last year. This year’s Dividend declaration makes the second consecutive time on Dividend declaration after the four (4)-year break on Dividend payment. It is the hope of the Board of Directors that the Bank’s performance will continue to improve in the years ahead and the Shareholders will yield the needed returns on their investments.
The Total Assets of the Bank amounted to approximately GH¢233 million in December 2023, representing an increase of %41.89 from about GH¢ 164 million in 2022.
The Bank’s growth in Total Assets was driven by a healthy increase in Deposits and the performance for year-to-date strongly suggests the Bank is very likely to witness a similar trend in 2024.
Chairman of the Board of Directors, Mr. Alexander Frimpong announced these and more at the bank’s 34th AGM of shareholders held last Saturday at Fomena in Ashanti.
Operational Environment
According to him, the Nation’s business environment improved marginally following from the economic and business challenges experienced in 2022. The economy witnessed some rising unsustainable debt and pressure on public finances.
The effect impacted on the Gross Domestic Product (GDP) performance and the local economy recorded a GDP growth rate of 2.9% in 2023, compared with a growth rate of 3.1% in 2022.
Inflation however, declined sharply in 2023 closing at 23.2% in December 2023 compared to 54.1% in December 2022. This decline was driven by easing of food and non-food inflation.
Food inflation decelerated sharply by 31.0 percentage points to 28.7% in December 2023 from 59.7% in December 2022. Similarly, non-food inflation fell by 31.2 percentage points to 18.7% in December 2023 from 49.9% in December 2022.
The decline in inflation was on the back of tight monetary policy stance, relatively stable exchange rate, and improved liquidity sterilization. The Central Bank uses the Monetary Policy Rate (MPR) as the primary policy tool to set the monetary policy stance and anchor inflation expectations in the economy.
The MPR as at December 2023 was 30% compared with 27% at same period a year ago. The 91-day and 182-day Treasury bill rates decreased to 29.39% and 31.70% respectively in December 2023, from 35.48% and 36.23% in the corresponding period of 2022.
Similarly, the rate on the 364-day instrument decreased to 32.97% in December 2023 from 36.06% in December 2022. Easing from the Domestic Debt Exchange Programme in 2022, the banking sector’s performance in 2023 pointed to gradual recovery from the challenges that bemoaned the sector in 2022.
The year 2023 saw growth in banks’ assets, supported by increased liquidity flows from deposits and a build-up in shareholders’ funds from the profits posted. The Bank of Ghana projects the sector to remain sustainable and resilient with regulatory measures put in place so far.
Operational Performance
In spite of the challenging macroeconomic environment coupled with the unprecedented high inflationary rate that pertained during the reviewed year, the bank managed to pull yet another remarkable operational performance in all key financial indicators as indicated in the table.
| Items | GH₵’ Million 2023 | GH₵ ‘Million 2022 | Percentage Change |
| Total Assets | 232,984,792 | 164,091,226 | 41.89 |
| Shareholders’ Fund | 15, 868,922 | 11,460,023 | 38.47 |
| Stated Capital | 5,039,787 | 4,975,310 | 1.29 |
| Deposits | 211,950,012 | 143,103,322 | 48.12 |
| Loans & Advances | 42,881,904 | 41,225,839 | 4.02 |
| Investments | 140,281,757 | 83,860,758 | 67.28 |
| Fixed Deposits | 8,820,642 | 10,215,061 | (13.65) |
| Total Operating Income | 36,659,338 | 25,434,819 | 44.13 |
| Profit Before Tax | 6,201,540 | 2,423,182 | 155.93 |
| Profit After Tax | 4,807,539 | 1776,040 | 170.69 |
| Proposed Dividend | 1,397,089.02 | 463,117 | 201.67 |
Stated Capital & Shareholders’ Funds
The Bank’s Stated Capital grew by 1.29% from approximately GH₵ 4.97million in 2022 to a little over GH₵5million in the year under review while Shareholders’ Funds also increased by 38.47% in 2023 compared to 19.36% in 2022.
While the Bank expects an expansion of its Balance Sheet through organic growth, it is important to sign on new shareholders and also have existing shareholders invest more into the Stated Capital of the Bank. This according to the board chairman would enable the growth of the Bank to be accelerated and ensure that the Bank is able to expand its operations and enhance its profitability to the benefit of its cherished shareholders.
SOCIAL RESPONSIBILITY
The Bank continues to provide support to various state institutions and stakeholders within its catchment areas. Some projects supported within the bank’s catchment areas during the year under review included that of the Traditional Councils, Ghana Education Service (GES), the Ghana Police Service, Heal the Komfo Anokye Project at the Komfo Anokye Teaching Hospital (KATH) and support for Farmers’ Day Celebration.
The Board Chairman stressed that the bank is socially responsible and would continue to support projects and engage in environmentally friendly activities in the years ahead.
FUTURE OUTLOOK
The Chief Executive Officer of the Bank, Daniel Amponsah in an interview with Business & Financial Times said the Bank would continue to put in pragmatic measures to ensure positive growth and achievement of the Strategic Plan of the Bank.
He stressed that the Bank would intensify loan recovery, embark on intensive deposit mobilization, strengthen internal controls and maintain quality assets to increase profitability.
He has also emphasised that the Bank’s business focus in 2024 is on driving growth, innovations, efficiency and service as the main pillars in achieving profitability.
Mr. Amponsah stressed the Bank would develop the human capital to meet demands of functioning profitability as well as achieving the objective of overcoming the shocks of the unfriendly macro economy and rising cost of living as well as its devastating effects.
