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31.10.2008 Business & Finance

BRRI CU income reduces


Total equity of the Building and Road Research Institute Co-operative Credit Union rose from 453,889.58 Ghana cedis in 2007 to 567,261.68 in 2008, representing an increase of 24.90 per cent.

However, its total income reduced from 87,833.56 Ghana cedis to 68,971.41, representing 21.47 per cent in the same period.

Mr Mohammed Baba Braimah, Chairman of the Board of Directors, said this at the 36th annual general meeting of the Union at Fumesua, near Kumasi, on Thursday.

He attributed the fall in income to some challenges that the Union faced during the period under review.

These include the aggressive infiltration of banks and other micro financial institutions into the credit union market.

The Union also had to grapple with the dwindling interest on loans compelling the Board of Directors to reduce interest rates by 0.5 per cent which culminated in a loss of 11,577.99 Ghana cedis.

This led to the replacement of the traditional loan repayment method, which is reducing balance method, with the straight-line repayment method.

This brought about liquidity problems resulting in the loss of 37,435.57 Ghana cedis to the Union.

He said these events, coupled with the challenges of managing the accelerated growth the Union had experienced in the past years, impacted adversely on the overall performance of the Union.

Mr Braimah said some achievements had been made and mentioned the completion of the first phase of the land acquisition for the Union model village project at Bomfa, the completion of the office complex for the Union, purchase of 3-set of canopies for the Union as well as the order for 250 micro savings boxes for members to encourage voluntary savings.

He suggested to members to begin looking at the possibility of developing a retirement product to cushion them during their retirement period.