All rural banks to be computerized
Kofiase (Ash), Sept. 30, GNA - All rural banks' head offices and agencies will be computerized within the next three years under the Millennium Challenge Account (MCA) programme. Mr Mr Emmanuel Kwapong, Managing Director of ARB Apex Bank, said the MCA would also provide funds to install a Wide Area Network (WAN) to connect all the rural banks to the Apex Bank and the Bank of Ghana (BOG).
This was contained in an address read on his behalf at the 18th Annual General Meeting (AGM) of Otuasekan Rural Bank at Kofiase in the Sekyere West District on Friday.
He said benefits from the assistance to the rural banks were enormous and that in addition to improving operational efficiency, it would also enable the full integration of rural banks into the national payment system. Mr Kwapong spoke about fraud in some rural banks and said the Apex Bank had put in place measures to ensure that the activities of fraud syndicates operating all over the country was stopped. "Some members of the fraud syndicate either collaborate with some members of staff of the banks or members of staff's non-observance to laid down procedures and internal controls facilitated their dubious activities.''
Mr Kwapong said one of the critical issues facing rural banks of late was the issue of good corporate governance and advised that rural banks guarded against favouritism and nepotism and elect right people to serve on their boards to enhance the banking industry. Mr Justice Isaac Adjei Baffour, chairman of the Board of Directors of the Otuasekan Rural Bank, said the bank's profit before tax declined from 1.5 billion cedis in 2005 to 946 million cedis in 2006. He attributed this to the decline of interest rates, high of petroleum prices resulting in higher running cost and staff malfeasance. Mr Baffour said in spite of the fall in profit level in the year under review, the major balance sheet items showed significant improvements. Assets of the bank grew from 32.1 billion cedis to 47.8 billion cedis, showing an increase of 18.96 per cent.
Total deposits rose from 24.8 billion cedis to 39.6 billion cedis, an increase of 59.73 per cent, net worth of the bank also grew from 3.1 billion cedis to 4.1 billion cedis in 2006 resulting in an increase of 15.81 per cent.
Investment also increased from 13.1 billion cedis to 20.5 billion cedis, representing 57 per cent.
He called on all loan defaulters to repay their loans to improve the non-performing assets and to increase profitability of the bank.