Atwima Kwanwoma Rural Bank Limited at Pakyi No2 in the Ashanti Region has designed some credit relief packages for clients to cushion them in coping with effects of the COVID-19 pandemic
The offers include tenor extensions and deferment on eligible loans for clients in vulnerable sectors highly impacted by the pandemic; particularly Susu loans, SMEs (Loans and Overdrafts) and Clearance loans.
These relief interventions have become necessary because of the trickle-down effect of COVID-19 on rural banks and the banking sector in general.
The bank has given special consideration of three months’ moratorium to private school teachers, salary workers of private institutions, and churches that have taken loans for their development projects.
The bank has also suspended charges and insurance on facilities to these three most-affected areas of their customers.
Other interventions include applications for additional facility with existing security; existing principal loan balance and new loan approved are put together and spread over the new loan term, with commitment and insurance fees applied to the new loan facility.
Talking to Business & Financial Times in an exclusive interview, the CEO of Atwima Kwanwoma Rural Bank, Dr. Stephen Sarfo Kantanka, reiterated that the pandemic has affected the global economy, and the banking industry in Ghana, generally, has been equally affected in many ways.
According to him, the designed interventions will be a comprehensive exercise, but they will be looking at it on case by case basis and offer suitable measures.
He said, for instance, that under its church development loan scheme, the bank will offer between three to six months’ moratorium; and on the other hand, businesses that are not doing well and depending on the type of goods in which the clients deals, will be given additional funds to recapitalise their businesses.
He emphasised the current unfortunate situation of private school teachers who have been very badly hit by economic effects of the pandemic, wherein schools have been closed and their livelihoods affected.
These categories of clients will be given three months’ moratorium on both interest and principal, in anticipation that after three-months government will have lifted the ban and schools will be in session.
The CEO mentioned that there are some clients who were completely out of business and overspent, which ate into their capital. Dr. Sarfo Kantanka has given a firm assurance that those affected in this regard will be recapitalised at a concessionary interest rate.
“You see the old balance is existing; so if we give the person additional capital and we make it run on the same interest rate, that will be too much and may suffocate the customer,” he added.
He mentioned that the bank has a symbiotic relationship with its customers and takes decisions that are of mutual benefit to them both.
“If the customer’s business collapses, the bank will not have any business to do; we are not in normal times and this is not the time for the bank to be making super-normal profit – and we cannot do that to collapse people’s businesses,” he stressed.
Earlier, the bank donated boxes of hand sanitisers costing GH¢10,000 to seven health facilities within its operational territories to support government’s effort in fighting the spread of coronavirus.
Atwima Kwanwoma Rural Bank is the pacesetter in rural banking, and among the first three best performing rural banks in Ghana.
As at the end of first-quarter 2020, the bank’s total assets had hit approximately GH¢195million, with deposits of about GH¢151million; and recorded a paid-up capital of GH¢3.3million which far exceeds the minimum threshold by 230%.
The bank had as at March 2020 recorded profit of a little over GH¢2.1million, and offered loans and advances to the tune of approximately GH¢36.6million with a net worth of GH¢41million.