Weto Rural Bank makes profit

Kpeve (VR), Sept 29, GNA - The total national assets base of rural and community banks stood at 976.8 billion cedis, while total deposits mobilised also stood at 739.1 billion cedis as at June.

Mr John Aboagye Asare, Chief Manager, Banking Supervision Department of the Bank of Ghana said this at the 17th annual general meeting of the Weto Rural Bank WRB) at Kpeve in the Kpando District at the weekend. He said the banks channelled 273.9 billion cedis into the rural economy during the same period.

"These impressive results are clear indications of the growing public confidence in the rural banking system", the Chief Manager said. He said the total assets of the WRB showed an increase of 3.230 billion cedis from 2.273 billion cedis, representing 42.1 per cent between June 2002 and June this year.

Its deposits also went up to 2.667 billion cedis from 1.878 billion cedis with a 42 percent increment within the same period.

Mr Asare said the bank also made appreciable progress in its Treasury Bill Investment, shareholders fund, loans and advances.

He said this sterling performance had won the bank a satisfactory capital adequacy ratio of 60.15 per cent, according to the banking industry report on Rural and Community Banks at the end of June. Mr Asare said within the period only 68 out of 115 rural banks have complied with the central bank's directive requiring a minimum capital operational level of 100 million cedis for the banks.

He advised rural and Community Banks which had fallen short of the level to "seek the consent of shareholders and suspend the payment of dividends until they are able to raise their capital to the required level.

The Chief Manager said Bank of Ghana has revised its share acquisition by individuals and institutions in rural banking to 20 per cent and 50 per cent from the previous 10 per cent and 30 per cent respectively.

Mr Asare said the review was to enable Rural and Community Banks to provide more credit in the rural economy to stimulate the level of growth desired by the central bank.

He said he hoped that rural banks will adopt appropriate policies and procedures to strengthen credit administration to minimize the incidence of over due loans.

Mr David Yao Kludje, Chairman of the Board of Directors of WRB, said the bank recorded a pre-tax profit of 111 million cedis at the close of July while its customer deposit went up by 800 million cedis and registered 550 new customers.

He said the Board "is proposing a dividend policy of declaring 30-40 per cent income after tax and statutory reserve as dividend" to help the bank to comply with Bank of Ghana minimum share capital requirement of 100 million cedis.

On investment, Mr Kludje said the Bank's investment in government securities shot up to 1.3 billion cedis from 988 million cedis. He said it has invested 10 million cedis in Cocoa Products Company and hopes to invest 13 million cedis as equity in the ARB/Apex Bank.