Kintampo Rural Bank records impressive performance

By Nana
Osei Kyeretwie, GNA

Kintampo (B/A), Aug. 04, GNA – The Kintampo
Rural Bank Limited (KRBL) has achieved an impressive performance in its 2016
operational year with a pre-tax profit of GH¢1.75 million.

This is an increase of 27.96 per cent over the
previous year’s which was GH¢1.39 million, Mr. Yaw Effah-Baafi, the Chair of
the Board of Directors announced at the Bank’s 32nd Annual General Meeting, at
Kintampo in the Brong-Ahafo Region.

The total assets of the Bank grew from GH¢22.14
million in 2015 to GH¢27.46 million, representing an increase of about 224.03
per cent, he said.

He explained that the assets’ growth was
mainly funded by a 20.44 per cent increase in customer deposits to close at GH¢17.14
million; up from GH¢14.23 million and shareholders’ funds, which increased by
20.11 per cent from GH¢5.81 million to GH¢6.98 million.

Mr. Effah-Baafi stated that the Bank’s
liabilities, its loans and advances portfolio grew from GH¢8.11 million in 2015
to GH¢9.68 million in 2016, signifying an increase of 19.37 per cent.

The Bank maintained a relatively high capital
adequacy ratio of 31.43 per cent “which is well above the minimum regulatory
requirement of 10 per cent, thus providing an ample buffer against any
eventuality,” he said.

Mr. Effah-Baafi said the Bank paid a corporate
tax of GH¢473,785.00 to the Government during the year under review, as against
GH¢118,561.00 for 2015, implying an increase of 299.61 per cent.

He observed that the imposition of high rate
of corporate taxes on banks was gradually affecting the operations of most
rural and community banks in the country,.

This, Mr. Effah-Baafi explained, was because
rural banks were supposed to alleviate poverty and build up the economic
livelihoods of the rural and peri-urban communities, therefore,  the huge taxes imposed on them would hamper
their operations.

He, therefore, appealed to the Government “as
a matter of urgency” to reduce the 25 per cent corporate tax on rural and
community banks to enable them to stay in business and continue to support the
rural population.

“The nature of rural banks and the areas they
operate in would require government’s interventions from time to time to
sustain the banks growth,” the Board Chair appealed.

Mr. Effah-Baafi announced that the Bank had
already met the requirement for rural and community banks to increase their
minimum capital to GH¢1 million by the end of 2017,  ahead of the deadline stipulated by the Banks
and Specialised Deposit-Taking Institutions Act, 2016 (Act 230) .

He, however, urged the shareholders to
increase their shareholdings to enable the Bank to invest in capital projects
like ATM and other E-Banking prepositions.

In the areas of lending to Agriculture and
Small and Medium Scale Enterprises (SMEs), corporate governance and corporate
social responsibilities, Mr. Effah-Baafi described the Bank’s performance “as
very impressive”.

He cited that it partnered the USAID-Financing
Ghanaian Agriculture Project (USAID-FinGAP) to advance a loan of GH¢0.96
million to 428 beneficiary farmers in the cultivation of maize, soya bean, rice
and their value chain at a reduced interest rate.

He said that represented 71 a per cent
increase over the 2015 total advance to the agriculture sector of GH¢0.56

Mr. Effah-Baafi added the Bank expanded its
operations to cover most clients who were into SMEs within its catchment area
and advanced  GH¢1.47 million to support
298 groups with an average membership of four persons.

That translated to seven per cent increase
over the previous year’s total advances of GH¢1.37 million to the same sector.


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