- bags GH¢24.7million profit
- offers shareholders 30% returns on investment as dividend
By Seth KRAMPAH, Pakyi No2
Atwima Kwanwoma Rural Bank PLC at Pakyi No2 in the Amansie Central District of Ashanti Region has recorded yet another remarkable operational performance in the 2023 year under review.
Profit & Dividend
In the Bank’s recognition of solid financial performance in 2023 and the Board’s commitment to delivering value to shareholders, the Board has proposed a dividend of GH¢0.15p per share for 2023 financial year representing a return of 30% on the current share value.
In all 16,341,527 ordinary shares qualified for the dividend as at the closure of register on September 30, 2023 and this amounts to GH¢2,451,229.05. This became possible after the Bank of Ghana had given an exceptional approval to a proposal put in by the Board of Directors. The Board has therefore assured shareholders of their continuous efforts to continue to pay dividend in subsequent years.
The Bank recorded a pretax profit of about GH¢24.7million compared to approximately GH¢ million in the previous year representing an impressive growth of 161.73 %. The Bank not only elevated its service offerings but also achieved remarkable strides in profitability, maintaining its position as one of the best performing rural banks in Ghana.
The Bank’s profit margin experienced a robust and encouraging increase, propelled by the board and management’s strategic emphasis on meticulous cost management and a deliberate shift towards high-margin products.
This impressive figure reflects not only the growth in both shareholder funds and profit before tax but also highlights the Bank’s exceptional ability to enhance these financial metrics. The Board’s strategic focus and operational excellence have allowed them to significantly outperform industry averages, demonstrating the Bank’s commitment to delivering outstanding value to their stakeholders.
The Chairman of the Board of Directors, Kwame Kyei Kusi who announced these and more at the Bank’s 41st Annual General Meeting of Shareholders held recently at Pakyi No2 near Kumasi in Ashanti Region.
Operational Environment
According to him, the global economy experienced dawdling growth and high inflation in the 2023. The International Monetary Fund [IMF] reported decline in global economic growth from 3.5% in 2022 to 3.0% in 2023. Advanced economies are estimated to slow down due to policy tightening, with growth rates falling from 1.5% in 2023 to 1.4% in 2024.
Emerging markets and developing economies are also expected to see a slight decline in growth from 4.1% in 2022 to 4.0% in 2023and 2024.
Ghana’s economy for the year 2022 and 2023 reflected a complex landscape characterized by significant challenges, including high inflation, debt issues, and a struggling currency, but there were efforts to stabilize and reform the economy.
The economy experienced a 2.9 % growth in 2023, which is lower than the 3.8 per cent recorded in 2022. Inflation remained a significant challenge throughout 2023, from the 2022 peak value of 54.10 percent, with year on-year rate reducing to 23.20%
The Banking industry in Ghana remained robust and well placed despite economic challenges encountered during the year under review. The banking sector, which was astounded by the Government’s Domestic Debt Exchange Program (DDEP) in the last quarter of 2022, managed to recover and make some significant gains.
Profitability grew by 224.6% from GH¢ 6.6 billion loss in 2022 to GH¢ 8.3 billion profit in 2023. The sector’s Return on Assets [ROA] improved to 5.4% in December 2023 from -3.8% in December 2022. Also, banks’ Return on Equity [ROE] rose to 34.25% from -25.5% over the comparative period.
Overall, the Banking sector performance in 2023 pointed to a gradual recovery from the challenges in 2022. The Rural Banking sector saw a significant growth in all the financial indicators. The sector recorded total deposit of GH¢9.7 billion with total asset at 11,08 billion and profit before tax of GH¢364 in total.
Operational Performance
In spite of the challenging macroeconomic environment coupled with the unprecedented occurrence of DDEP amidst high inflationary rate that pertained during the reviewed year, the bank confidently and comfortably pulled another remarkable operational performance in all key financial indicators as shown in the table.
| Indicators | 2023 | 2022 | % Change |
| Deposit | 378,072,248 | 293,938,997 | 28.62 |
| Investment | 297,782,142 | 227,427,147 | 30.94 |
| Loans /Advances | 76,652,534 | 57,818,466 | 32.57 |
| Total Assets | 460,036,059 | 356,743,095 | 28.95 |
| Stated Capital | 3,929,712 | 3,550,565 | 10.68 |
| Shareholders Fund | 64,295,077 | 48,150,683 | 33.53 |
| Gross Income | 90,918,899 | 66,728,498 | 36.25 |
| Profit Before Tax | 24,712,060 | 9,441,868 | 161.73 |
Stated Capital
The Bank’s Stated Capital increased to GH¢3,929,712 at the end of the year 2023, up from GH¢3,550,565 in the previous year resulting in an increase of GH¢379,147 representing a growth of 11%.
As a requirement by the Bank of Ghana [BOG], all Rural and Community banks are to meet a minimum stated capital of GH¢1million and Akrbank has it in excess of 300%. The Board has therefore appealed to shareholders to buy more shares since Bank of Ghana may very soon increase the minimum requirement.
Corporate Social Responsibility
In the year under review the bank spent a total amount of GH¢175,104.00 on Corporate Social Responsibility activities towards the stakeholders within its catchment areas with special focus on Health, Education, Security, Agriculture and other social needs.
Awards
The bank was adjudged the ‘Rural Bank of the year 2023’ by KN Unique Communications in the Ghana West Africa Business Excellence awards which was held in Accra at the Movenpick Hotels and Resorts Accra, on 10th May, 2024. The bank was awarded for the bank’s outstanding contributions to the business community.
This year the bank was selected as a winner of the 5th Ghana Credit Excellence awards in the MSME Rural & Community Bank Brand of the Year category at the British Council, Accra among other prestigious awards for the year under review.
FUTURE OUTLOOK
The Chief Executive Officer of the Bank, Samuel Sekyere Bonsu 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. Sekyere Bonsu stressed that 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 just to improve upon its enviable image as the pace setter in rural banking.
