Waive restriction on payment of dividend to shareholders

Agona Swedru, Dec. 21, GNA - Central Regional Chapter of Association of Rural Banks has expressed concern about the restriction on payment of dividend to shareholders unless the rural banks had mobilised 150,000 Ghana cedis as its capital before commencing business. It has therefore appealed to Bank of Ghana (BOG) to waive the restriction on payment of dividend to shareholders to attract investors in rural banks. Mr Kweku Acquaah, President of the Chapter addressing a press conference at Agona Swedru said the directive had affected their operations, especially in areas where income levels of the people were low.

He said people outside their catchment areas who had money to invest in their operations were reluctant to invest in rural banks because of the restriction on payment of dividend. "The greatest challenge facing rural banks is Bank of Ghana's regulation that has increased the minimum paid-up capital of rural banks to 150,000 Ghana cedis," Mr Acquaah said. He said since the inception of rural banks, they had chalked many successes and contributed substantially to the economic development of the country.

Mr Acquaah said to solve the 150,000 Ghana cedis, share capital problem, most rural banks were considering merging their operations therefore, next year the association would embark on an intensive sensitisation and education programme to enable shareholders make inform decision.

He said the 18 million dollars set aside under the Millennium Challenge Account to help computerise rural banks had not been implemented and was long over due. Mr Acquaah appealed to Government to expedite action on the computerisation programme. He appealed to Government to channel the District Assemblies Common Fund through rural banks, especially those in the district capitals.

Mr Acquaah cited Agona East and Gomoa East District Asemblies that received their shares through Ghana Commercial Bank and National Investment Bank. "Rural banks being the wheels of rural development should be involved in the large volumes of financial transactions to enable them render quality services to the people, "he added. 21 Dec. 08