HFC declares huge profits

Accra (Greater Accra), 21st April ?99 ?

Home Finance Company (HFC) Company Limited on Wednesday announced a net profit after tax of 3.5 billion cedis for 1998 out of which a total dividend of 1.36 billion cedis will be paid.

While the figure for profit after tax represents 52.1 per cent increase on 1997's 2.3 billion cedis, the dividend pay out is 92 per cent higher than the gross dividend paid out for the previous year.

The dividend per share is 24 cedis.

At the company's annual general meeting in Accra, Mr Samuel Kortei Botchwey, Chairman of the Board of Directors, said the company achieved this by taking advantage of the sound economic policies of government. He observed that 1998 was "particularly difficult for the Ghanaian economy due to the adverse impact of the global financial crisis ...and the domestic energy crisis. "Notwithstanding, the government kept its resolve to pursue sound fiscal and monetary policies that promoted stable macro-economic environment suitable for investment growth."

Mr Botchwey said HFC took advantage and as a result increased its total assets by 37.8 per cent from 59 billion cedis in 1997 to 81.3 billion cedis in 1998.

Likewise, total income increased to 12 billion cedis from the previous eight billion cedis. Shareholders' funds stood at 13.4 billion cedis from 5.4 billion cedis. Total tax paid for 1998 was 627.9 million cedis compared to 332.6 million cedis for 1997 while operating income was 9.6 billion cedis, up from 6.4 billion cedis. Mrs Stephanie Baeta Ansah, Managing Director, said HFC now has a better balanced portfolio of indexed cedi and dollar mortgages that has increased substantially to over 62.1 billion cedis. She noted that the rights issue in August last year was over- subscribed by four per cent and this enabled them to increase the stated capital to approximately eight billion cedis. While the HFC-Unit Trust and the HFC-REIT ended the year with yields of 44 and 46 per cent respectively, the wholly-owned home finance investment fund limited (HFIF) doubled its profit level. She said the company has applied to the Bank of Ghana for a license to establish a bank which it intends to do with technical assistance from the ABN AMRO bank, the sixth largest bank in Europe. It has also acquired a new property known as Ebankese, meaning, Mighty Fortress, in addition to offices obtained in Kumasi, Tema and Agbogbloshie market.

"1999, will be a year of consolidation and strengthening of the business base. Our current healthy financial resources will be put to the best advantage of our shareholders and other investors through an expansion of the mortgage portfolio and provision of finance for housing developments." Mr Henry Dei, a director with the Standard Chartered Bank, was elected member of the board of directors while Mr Ken Ofori-Atta was re-elected as board member.