Kaaseman Rural Bank posts satisfactory growth in 2019

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Kaaseman Rural Bank Limited at Sefwi-Kaase in the Bia East district of the Western Region has posted satisfactory growth across performance indicators during the 2019 fiscal year under review.

The bank recorded margin increases in areas such as total assets, advances, investments and deposits; while reserves, profit and shareholders’ funds saw a decline against appreciable growth in paid-up capital.

Arguably in the area of a very important indicator in the banking industry – total deposits, the bank mobilised a little over GH¢48.65million in 2019. This represents 12.3 percent more compared to the 2018 achievement of GH¢43.34million.

The total outstanding loans and overdrafts granted by the bank during the year under consideration stood at GH¢30.90million. The money was channelled to sectors like petty trading, agriculture, cottage industries, transport and salaried workers. In 2018 the bank advanced a total of GH¢30.48million, showing 1.4 percent less as compared to the 2019 figure.

At the end of 2019 financial year, the total assets base of Kaaseman Rural Bank was put at GH¢58.04million against GH¢54.64million in the previous year – indicating a marginal growth of 6.2 percent.

Mr. Paul Donkor, Chairman of Board of Directors-Kaaseman Rural Bank, announced these developments during the 32nd annual general of shareholders held at Sefwi-Kaase. He said externalities such as stiff competition and other macroeconomic shocks affected anticipated growth for the bank in 2019.

He noted that the bank’s pre-tax profit declined significantly from GH¢1.43million to GH¢440,276, representing 69.3 percent decrease. “The reasons attributed to the drastic reduction in profit for 2019 include many customers’ inability to pay back credit facilities extended to them by the bank on maturity dates; falling interest rates, which remain a burden to the bank as it has great impact on its profitability; and the bank’s inability to redeem its investments that are locked-up with some of the defunct financial institutions,” he said.

The bank was unable to declare dividend for its shareholders. The Board Chairman explained that the decision is in adherence to a directive by the Bank of Ghana, the regulator, for all banks not to declare dividend due to impacts of the COVID-19 pandemic on the financial sector.

Commenting on corporate social responsibility, Mr. Donkor said the bank spent about GH¢20,000 on development donations toward the reconstruction of a burnt dormitory of Methodist Senior High/Technical School, and Berekum and Drobo Traditional Council toward the celebration of their Munufie Kesse festival.

He added that the bank donated a motorbike to the Police Service at Sefwi-Kaase to aid mobility, and an air-conditioner to the Sefwi-Debiso District Police Headquarters. “The bank continues to provide financial support to needy but brilliant students. However, at close of the year, almost all the beneficiary students had completed their studies.”

Details of the bank’s performance are captured in the table below.

Indicator 2019 (GH¢) 2018 (GH¢) % Change
Total Assets 58,048,828 54,642,755 6.2
Total Deposits 48,651,719 43,340,384 12.3
Advances 30,905,383 30,488,478 1.4
Investments-short term 14,585,228 14,085,228 3.5
Investments-long term 126,590 126,590
Profit before tax 440,276 1,1435,110 -69.3
Paid-up capital 2,616,869 1,911,944 36.9
Reserves 3,462,968 5,523,111 -37.3
Shareholders’ Funds 6,079,837 7,435,055 -18.2

 

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