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27.10.2008 Business & Finance

Akyempim Rural Bank declares profit but fail to pay dividend

By gna

The Akyempim Rural Bank in the Central Region, made a profit of GH¢95,196 before tax for 2007 but failed to declare dividend due to its inability to meet the new minimum capital for rural banks.

Colonel (Rtd) .K. K. Nyame, Chairman of the bank's Board of Directors, who announced this at the 23rd Annual General Meeting (AGM) at Gomoa Dawurampong, said the amount was an improvement over the previous year's profit of Gh¢92, 285.63.

He said the bank did not pay dividend because the new BOG instruction did not permit banks whose stated capital fell below the new minimum stated capital.

He said GH¢1,852,196 was granted as loans and advances to 2,909 customers in 2007 as against GH¢5,065.20 to 2,393 in 2006.

Col. Nyame stated that the bank made an investment of GH¢850,000 in 2007 as against GH¢8,000,000 in 2006.

He said a substantial part of the loan went into the education sector.

The Chairman noted that plans were far advanced to raise the stated capital of the bank from GH¢100,000 to GH¢200,000 to ensure a solid capital base for its operations.

He said the Board had recommended the issue of 12,342 bonus shares at five (5) Ghana Cedis per share to raise GH¢61,705 additional capital to meet the GH¢163,000 capital requirement of the Bank of Ghana (BOG).

He announced that the bank would move to new premises in 2009 and urged the shareholders to buy more shares to increase the capital of the bank.

Mr Nyame appealed to the management and staff to work hard to deliver dedicated financial services to customers.

Mr Osei Bonsu, Managing Director (MD) of the ARB Apex Bank, the umbrella body of rural and community banks, in a speech read for him, urged the Akyempim Rural Bank to strengthen its internal control mechanism to ensure that it operated in a sound and safe environment.

He advised rural and community banks to institute a risk management policy that would assist it to identify, assess, monitor and control risk of their operations.

Mr Osei-Bonsu said the Apex Bank had entered into an agreement with Japan Motors to supply rural and community banks with 198 Nissan double cabin pick-up vehicles to enhance their operations.