The National Investment Bank (NIB) Limited is investing $22 million in out-grower rubber and oil palm plantations in the next six years.
Under the project, which is being executed in collaboration with the government, the Agence France de Development and Kreditanstalt fur Wiederaufbau (KfW), a German bank, NIB would give ¢100 million per annum to each farmer for six years to grow their farms.
The project took off last year and it is to assist seven oil palm mills in the Western and Central regions.
Managing Director of the bank, Mr Daniel Charles Gyimah, said in an interview after the company's 38th annual general meeting (AGM) in Accra that the move was part of the bank's policy plan to develop strategic sectors of the economy.
He said the oil palm project was to make for the shortfall of fruits in the industry, which was on the verge of developing its full capacity comparable to what pertained in a country such as Malaysia, which has developed the oil palm sector.
Mr Gyimah said some of the strategic areas that would benefit from a well developed oil palm industry was the energy sector, saying “we are encouraging the mills to use palm kernel to generate their own electricity and wean themselves off the national grid.”
The managing director mentioned the Juaben Oil Mill in the Ashanti Region, which has been assisted to use kernel to generate its own electricity in quantities that have enabled it to withdraw its dependence on the national grid and rather supplied electricity to a nearby hospital free of charge.
“We are targeting the re-activation of the Bonsa Processing Factory. Before we do so, we should get the raw material base before we can revive the factory,” he said.
At the AGM itself, the Chairman of the NIB Board of Directors, Dr Charles Jebuni, announced a 35.3 per cent growth in the bank's deposits from ¢1.25 trillion in 2005 to ¢1.69 trillion at the end of last year.
The bank's total income increased by 13.6 per cent to ¢251.86 billion last year, from the previous figure of ¢221.69 billion of year end 2005, the chairman announced, and added that as a result of systematic portfolio re-alignment and better risk management, the bank reduced its bad and doubtful debt provision by 84.7 per cent from ¢74.19 billion in 2005 to ¢11.37 billion.
Despite the creditable performance in most areas, the bank's profit after tax of ¢44.27 billion, was a dip compared to the ¢59.15 billion recorded in 2005.
However, the meeting approved a dividend of ¢325 per share, amounting to ¢17.307 billion, as against the previous figure of ¢13.313 billion in 2005.
Dr Jebuni said the bank would continue to deliver high value and modern financing and investment solutions to the benefit of clients, owners, investors and employees.
Dr Jebuni also announced the bank's intention to form the Bedrock Venture Capital in a joint venture with the State Insurance Company (SIC) and the Venture Fund Trust Company (VFTC) with an initial capital of $10 million.
He said in order to diversify the earning base of the bank, a new subsidiary, the NIB Properties, would be established to manage property and equipment re-possessed from its debtors.
Story by Samuel Doe Ablordeppey