Otuasekan Rural Bank posts growth in all indicators

• records GH¢1 million profit before tax
• shareholders get 31.7% returns on current GH¢50p share price

By Seth KRAMPAH, Kofiase

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 2024 year under review.

The Bank recorded profit before tax of approximately GH¢ 13.1 million in the year under review as against a little over GH¢ 5million in the previous year representing 153.1% 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.

By this, the Board of Directors has congratulated management and staff for the remarkable GH¢7.9million profit growth which translates in absolute terms and have therefore been urged to work assiduously towards increasing the Bank’s profitability to increase shareholders’ investments.  Directors of the bank have also been commended for their strategic direction and decisiveness in achieving this remarkable success.

Dividend Payment

The Board of Directors has proposed a total Dividend payment of GH¢2,000,931. This translates to a dividend-per-share of GH¢0.1585p which gives a return on a dividend of 31.7% on the Bank’s current share price of GH¢ 0.50p which the regulator has given its exceptional approval to pay the proposed dividend to shareholders.

It is the hope of the Board of Directors that the Bank’s performance will continue to improve and move towards such a positive direction to enable the continuous payment of Dividend in the years ahead.

Stated Capital and Shareholders Funds

In the 2024 year under review, the Bank’s Stated Capital grew by 17.11% from GH¢3.49million in 2023 to a little over GH¢ 4million in 2024. Shareholders’ Funds also increased by 23.33 % in 2024 from about GH¢15.9million in 2023 to approximately GH¢19.6million. The increase resulted from unprecedented profit achieved and rigorous sales of ordinary shares.

The Bank in spite of the growth in share capital is strategizing to sign up new shareholders, and also have existing shareholders invest more into the Stated Capital of the Bank. This will enable the growth of the Bank to be accelerated and ensure that the Bank is able to expand its operations and enhance its profitability to the benefit of cherished shareholders.

The Chairman of the Board of Directors, Kwadwo Nkansah – Fordjour announced these and more at the Bank’s 36th Annual General Meeting of shareholders held last Friday at Mampong Kofiase in Ashanti.

Operational Environment

According to him, Ghana’s real Gross Domestic Product (GDP) grew by 3.6% year on year in fourth quarter 2024 (October to December) according to the Ghana Statistical Service. The growth was largely driven by Information and Communication, Financial and Insurance Activities and Manufacturing.

The annual inflation rate in Ghana for December 2024 was 23.8% as against 23% during the same period in 2023. The Bank of Ghana Monetary Policy Rate ended the year 2024 at 27% as against 30% in 2023. The 91-Day Treasury bill rate also ended the year with 27.7%

In the 2024 year under review, Ghana’s rural and community banks (RCBs) played a pivotal role in bolstering the nation’s economy, particularly in advancing financial inclusion and providing credit to the Small and Medium-sized Enterprises (SMEs) sector. Amidst the macroeconomic challenges, these banks demonstrated resilience and innovation, significantly impacting local economies and underserved communities.

The banking sector remained resilient amid macroeconomic challenges. Total assets grew by 33.3% to GH¢323.2 billion as of June 2024, driven by robust growth in deposits and other funding sources. Profitability indicators showed improvement, with the sector remaining profitable and well-capitalized. The Capital Adequacy Ratio (CAR) with reliefs stood at 14.0% in December 2024, up from 13.9% in December 2023

In spite of the challenging macroeconomic environment coupled with the high inflationary rate that pertained during the reviewed year, the bank managed to pull a remarkable operational performance in all key financial indicators as indicated in the table.

Indicators	2024  Amount       (GHS)	2023  Amount       (GHS)	% Change
Deposits	293,780,833	192,008,924	53
Investments	207,669,197	107,532,183	93.12
Advances	59,432,749	53,696,447	10.68
Total Assets	335,922,009	217,721,193	54.29
Share Capital	4,028,486	3,439,835	17.11
Shareholders’ Funds	19,565,478	15,864,107	23.33
Profit before Tax	13,124,646	5,185,350	153.11

 

Corporate Social Responsibility

The Bank continues to provide support to various state institutions and stakeholders within its catchment areas. Some projects supported within the bank’s catchment areas during the year under review included that of the Traditional Councils, Ghana Education Service (GES), the Ghana Police Service, some government health facilities and support for Farmers’ Day Celebration. For the year 2024, a total of GH¢170,120 was spent on CSR programmes for local communities.

The Board Chairman stressed that the bank is socially responsible and would continue to support projects and engage in environmentally friendly activities in the years ahead.

Commendation / Advice

The Kumasi Manager of ARB Apex Bank, Leonard Maasang who delivered an address on behalf of the Managing Director, Alex Kwasi Awuah, congratulated the shareholders, Board, and Management of the Bank for the exceptional performance of the Bank.

He has commended the Board of Directors for providing strategic leadership, and Management for their operational efficiency and integrity. He added that the Bank’s 2024 results clearly indicate that Otuasekan Rural Bank is becoming a model of growth through prudence and innovation. “Your performance is not only a source of pride for your shareholders but also an encouragement to the entire rural banking sector”, he stressed.

The MD of ARB Apex Bank advised Otuasekan Rural Bank to deepen its adoption of digital tools; including agency banking, mobile banking platforms, and the GhanaPay solutions, to enhance service delivery, expand outreach, and reduce operational costs.

He mentioned that digital transformation is not merely about technology; it is about building convenience and trust. He stressed that ARB Apex Bank continues to invest in shared digital infrastructure for RCBs and urged Otuasekan Rural Bank to leverage these platforms to reach more customers, especially the youth and informal sector workers who increasingly prefer mobile-based services.

Outlook

The Chief Executive Officer of the Bank, John De-Graft Owusu, in an interview with the Business & Financial Times, said the Bank would continue its good services and develop need-based products for its customers.

He has also affirmed that Otuasekan Rural Bank continues to stand as a pillar of financial resilience and community empowerment. According to him, the Bank’s performance over the past year reflects not only prudent management and operational efficiency, but also the unwavering trust customers and stakeholders place in them.

“We are poised to make significant strides in expanding our digital banking platforms, deepening financial inclusion, and supporting local enterprises, especially in underserved areas. These achievements are a testament to our commitment to innovation, transparency, and sustainable growth.”

Mr De-Graft Owusu said he and his team are energized by the opportunities that lie before them. He stressed that their strategic focus remains anchored on enhancing customer experience, strengthening risk management framework, and investing in staff capacity development which he believes will enhance the bank’s profitability

Shareholders at the meeting

 

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