- bags 5.2 million profit
- pays GH¢ 0.072 as dividend per share
Otuasekan Rural Bank PLC at Kofiase in the Sekyere West District of Ashanti Region has posted a remarkable growth in all financial indicators in the 2023 year under review.
The Bank recorded profit before tax of approximately GH¢ 5.2 million in the year under the review as against a little over GH¢ 1.3 million in the previous year representing 294% impressive growth.
The rise in profit has been attributed to improved revenues generated from operations and prudent management of recurrent expenditures both on the part of the Board, Management and the entire Staff.
In view of this remarkable results, the Directors have recommended the payment of total dividend of GH¢838,119 representing GH¢0.072p dividend per share for the 2023 year under review.
The Directors of the Bank have obtained exceptional approval from the Bank of Ghana to pay dividends to the shareholders for the financial year of 2023. Otuasekan Rural Bank PLC is among the few Banks approved by the BoG to pay dividend.
The regulator’s “No objection letter to dividend declaration and payment is a clear indication that, the Bank had complied with all the conditions necessary for the payment of dividend to shareholders in accordance with the relevant laws.
This dividend declaration and exceptional approval has actually brought a huge relief to the Bank’s shareholders who have not received dividend for the past three years.
The Bank’s share capital stood at approximately GH¢ 3.4million at the end of the financial year ended 2023 which far exceeds the regulator’s threshold of GH¢ 1 million which makes the bank very capitalised.
The Chairman of the Board of Directors Dr Prince Stephen Adom Attakora announced these and more at the Bank’s 35th Annual General Meeting of shareholders held last Friday at Kofiase in Ashanti.
Operational Environment
According to him, Ghana’s economy continued to show signs of economic recovery and stability from the pandemic into the early part of 2022 only to be truncated by the spillover of the Russia-Ukraine war.
The supply chain disruptions associated with the Russia-Ukraine war and the tightening of financing conditions acted in concert to worsen Ghana’s debt levels, which were already at unsustainable levels, with attendant high debt-service cost and rollover risks.
The tight financing conditions in the face of widening financing gap were exacerbated by the Ghana sovereign credit rating downgrades and subsequent exclusion from the global capital market(s).
The combination of these adverse external shocks exposed Ghana to a surge in inflation, large exchange rates depreciation, and exerted significant financing pressures of the budget alongside rising public debt levels.
To address this economic crisis, the Government introduced Domestic Debt Exchange Program (DDEP) as one of the strategies. The effect of the DDEP on Government Budget revealed that the debt exchange programme resulted in about 77% reduction in the settlement value of the indicative bonds.
In spite of the unstable macroeconomic environment in which the bank operated during the reviewed year, the bank managed to pull an impressive operational performance in all the financial indicators as shown in the table.
|
Indicators |
2023
Amount (GHS) |
2022
Amount (GHS) |
%
Change |
| Deposits | 192,008,924 | 146,619,686 | 30.96 |
| Investments | 107,532,183 | 86,559,522 | 24.23 |
| Advances | 53,696,447 | 43,821,282 | 22.54 |
| Total Assets | 217,721,193 | 165,680,862 | 31.41 |
| Share Capital | 3,439,835 | 2,807,129 | 22.54 |
| Shareholders’
Funds |
15,864,107 | 13,388,601 | 18.49 |
| Profit
before Tax |
5,185,350 | 1,315,964 | 294.03 |
Corporate Social Responsibilities
The Bank continued to offer assistance to communities and institutions within its catchment areas in terms of community development projects. In the year under review the bank spent an amount of GH¢ 192,307 on corporate social responsibility activities towards the stakeholders with special focus on Education, Health, Security among others.
Rated Strong
Otuasekan Rural Bank was rated strong and ranked 19th out of 147 Rural and Community Banks (RCB) in Ghana, in the RCB’s Quarterly Performance Review for the 2nd quarter by ARB Apex Bank PLC.
Future Outlook
The CEO of the Bank, John De-Graft Owusu in an interview with Business & Financial Times said Management would continue to seek ways of strengthening and developing the Banks’ operations to maintain the confidence that customers and shareholders have in the Bank.
The Bank’s business model according to the CEO is still tailored for the Micro Small and Medium Enterprises and would push for more market penetration as they develop new and innovative products and trusted relationships with clients of the Bank.
The post Otuasekan Rural Bank records 294% growth in profit appeared first on The Business & Financial Times.
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