Ahafo Community Bank at Kukuom in the Asunafo South district of the Brong Ahafo Region has outlined strategies to increase owners’ equity significantly to meet the minimum capital requirement by end of first quarter this year.
All Rural and Community Banks (RCBs) were required by the Bank of Ghana (BoG) to raise a stated capital of GH¢1million by the end of December 2017. As at December 31, 2017, Ahafo Community Bank had managed to mobilise just GH¢436,208, with a deficit of over GH¢500,000.
Interacting with the B&FT, Mr. Pobi Antwi Donkor-General Manager of the Bank, revealed that pending BoG’s approval, the Board of Directors have agreed on a strategic injection to the tune of GH¢700,000 by three separate firms – at latest by March-ending this year.
The bank has also rolled out shares promotions – enticing the public with items such as smartphones, wax-prints and machetes, he added.
All things being equal, Ahafo Community Bank will be eligible to pay dividends to shareholders, starting from end of the 2018 financial year.
To this end, the bank has decided to adopt a plough-back ratio to ensure year-on-year increase of its stated capital to withstand the shock of future upward adjustments by the regulator.
Touching on other operational projections, Mr. Donkor said the bank in 2017 mobilised GH¢9.80million deposits, setting an increased target of approximately GH¢12.75million for 2018.
The bank is banking its hopes on a vigorous marketing drive within its cocoa-driven local economy to achieve the target.
Mr. Donkor indicated that the bank has budgeted giving out a little over GH¢4.54million as loans and advances, representing a 10% increase over the 2017 portfolio of GH¢4.13million.
About 45% of the allocation will go to monthly salary earning workers, 25% to micro traders and 20% to farmers, whereas cottage and transport operators will take 10%.
In 2018 the bank will increase its investments marginally, from GH¢5.29million to GH¢5.53million. The total income target for the year is around GH¢3.34million as against the 2017 achievement of GH¢2.76million.
The General Manager noted that the bank intends to install two ATMs at its Kukuom headquarters and the Goaso branch before the end of June, and roll out the U-Connect platform in the first quarter as well as opening new branches at Abuakwa in Kumasi and Dadiesoaba.
The bank expects these strategies to boost its profit margin, targetting GH¢688,949. In the previous year it achieved GH¢532,996.