Review Rigid BOG Rural banks manual-President.

Takoradi, April 21 - GNA-Mr. Eric Osei-Bonsu, President of the Association of Rural Banks of Ghana has called for a review and consolidation of the Bank of Ghana Rural Bank's manual, to suit modern banking trends.

He suggested that the review should include computerisation of banking operations, international money transfers, business advisory services and corporate governance culture.

Mr. Osei-Bonsu made the call at the opening of the fifth National Managers' Conference of the Association of Rural Banks (ARB) Apex Bank Limited, Rural and Community Banks (RCB) at Takoradi on Friday. The three-day conference is on the theme, "Innovation, Transformation and Poverty Reduction-The role of Rural Banks". "The strict regulatory regime must make room for flexibility, pro-activeness and innovation", he said.

Mr. Osei-Bonsu said the computerisation of rural banks would assist them to improve their performances within their respective communities. Mr. Osei-Bonsu said RCBs should assist their clients by linking them to market sources, processing, storage, and preservation and adding value to their products.

He suggested that loan beneficiaries must be properly trained as part of the loan acquisition process.

Mr. Osei-Bonsu said management techniques, credit acquisition, prudent use of credit, basic accounting principles and the need for savings should become part of each RCBs strategy with clients. He said there is the need for a total overhaul of the operations of at least 80 percent of RCBs, "The overhaul will help cut down on turnaround time at banking halls, adequate customer relations, while continuous training should be a must" he stressed.

Mr. Osei-Bonsu said the audit departments of RCBs should be strengthened and internal auditors should be provided with continuous training to enhance their capacity to detect and prevent fraud, errors and irregularities.

Mr. Emmanuel K. Kwapong, Managing Director of the ARB Apex Bank said total assets of the RCBs rose from 514.34 billion cedis in 2001 to 2,601.99 billion in 2005 representing 405.9 percentage increases. He said total profit before tax within the same period rose from 36.28 billion to 89.59 billion cedis. This represents 146.9 percent increase. Mr. Kwapong said total advances to customers, which stood at five percent in 2004 reduced to 4.65 percent in 2005, while investments in government treasury bills within the same period increased from seven percent to seven point seventy four percent.

According to Mr. Kwapong, it means, while several banks were giving out more loans and advances, the RCBs were rather shifting their funds into investments and treasury bills.

"This trend would certainly not augur well for RCBs, as returns on government securities are becoming unattractive" he emphasised. Mr. Kwapong therefore, advised the managers to channel their funds into micro-finance to help in the growth of the rural economy. He said several RCBs have been admitted into the Ghana Club 100, a corporate index for 100 high performing companies in Ghana. The RCBs are Ahantaman, Lower Prah, Bosomtwi, Adansi, Juaben, Nwabiagya and Sekyere.

The rest include Odotobiri, Manya Krobo, South Akim, Amansie West, Kaaseman and La RCBs.