Shareholders of rural banks urged to broaden capital base

The Chapter President of the Brong Ahafo Regional Association of Rural Banks (ARB) in Ghana has requested the stakeholders in rural banks to inject fresh and additional capital to buy more shares to broaden the capital base of the banks.

Mr Kofi Bonsu Boakye-Boateng appealed to the management of all rural banks in the Chapter to create an item in their annual reports to acknowledge the shareholders who constitute the top 30 of the shareholder ladder. Mr. Boakye-Boateng said this in a speech at the 32nd shareholders Annual General Meeting (AGM) of the Wamfie Rural Bank Limited at Wamfie in the Dormaa East District of the Brong Ahafo Region.

He said though the Wamfie Rural Bank has been able to pass the minimum capital requirement of GHC 375,350.77 required by the Bank of Ghana (BoG), the shareholders need to surpass the current level of capital so that the bank would not be adversely affected should the BoG decide to raise the minimum requirement in the near future.

The President said some fraudulent activities and security threats in some rural/community banks in the region have been uncovered at both management levels and junior staff levels by dedicated employees who want to put the banks on a sound foot. He said when disciplinary actions were taken and the management approved punitive measures against the culprits, it became the duty of either the operations manager or the general manager, or even the board chairman, to sign the letters communicating the punishment to the offenders. The measures include suspension pending further investigations, withholding of pay, withdrawal of some privileges and opportunities, demotions and reduction in ranks.

But unfortunately, some disciplined culprits and dismissed staff of the banks, he said, have resorted to naked daylight blackmail, sending threatening messages through mobile phone calls and SMS messages to operation managers, general managers and board chairmen who signed the punitive letters. According to him, the security agencies' attention has been drawn to the actions of the unscrupulous staff.

Meanwhile, the board chairman's report to the shareholders was delivered by Mr Solomon Oppong-Twumasi who stated that the bank recorded a total deposit of GHC6.48million as against GHC5.52 million in 2012, representing an increase of 17.45%. Though the increase was not very appreciable, the chairman was hopeful that with dedication and hard work, the bank would intensify its mobilisation drive in order to ensure the deposits grow steadily. Mr Oppong-Twumasi said the total assets of the bank increased by 8.9% from GHC8.12 million in 2012 to GHC8.85 million in 2013. Its fixed assets also rose from GHC216, 284.93 in 2012 to GHC328, 544.51 in 2013, representing an increase of 51.9%. In addition, he revealed, the bank made a profit before tax of GHC159, 025 during the period under review as against GHC142, 875.79 declared in 2012, which represents an increase of 11.30%.