Some 47 rural and community banks in the country may be bracing themselves for uncertain times as they are yet to meet the GH¢1 million minimum capital requirement needed to remain in operation.

With the year having entered the fourth quarter, those banks have just about three months to meet the deadline for the new capital benchmark.

All of the other 94 rural and community banks across the country have met the required minimum capital, according to the ARB Apex Bank Limited, which oversees the activities of rural and community banks in Ghana.

As of the initial deadline of December 31, 2017, only 51 of the existing 142 rural and community banks had met the new minimum capital requirement.

The deadline was extended by the Bank of Ghana following various levels of discussions among stakeholders.

The ARB Apex Bank has consequently encouraged rural and community banks yet to meet the new minimum capital requirement “to speed up with their compliance plans”.

At the 36th Annual General Meeting of Nandom Rural Bank at Nandom in the Upper West Region, the Managing Director of ARB Apex Bank, Kojo Mattah, urged the banks to add to their regulatory capital requirement “to enable them to take advantage of bigger business opportunities in their operations”.

In a speech read on his behalf by John Kweku Nyamador, the Wa Branch Manager of ARB Apex Bank, Mr Mattah announced that Nandom Rural Bank was one of the 94 that had met the minimum capital benchmark.

Modest profit

The chairman of the board of directors of the bank, Francis Kogh Beinpuo, confirmed that the bank’s total share capital had reached GH¢1,268,537, which exceeded the minimum capital requirement.

He announced that the bank made a profit before tax of GH¢609,403 for 2017 – by some distance quite modest as compared to the 2016 profit of GH¢1,059,941.

This notwithstanding he expressed worry at various developments in the financial sector of the country, indicating that those developments had impacted on the overall performance of the Bank in the year 2017.

These developments, he mentioned, included the collapse of UT Bank and Capital Bank in April last year, while the drop of the monetary policy rate from 25.5 per cent to 20 per cent; the drop of interbank rate from 26.2 per cent to 19.3 per cent; and drop in the interest on treasury bills were sector-specific issues.

“The interplay of all of these factors impacted seriously on the operations of your bank in the year under review,” he told the shareholders.

ATM services

He said the bank was working to roll out full automated teller machine (ATM) services at its Nandom and Wa branches “in order that our clients derive the benefits of seamless banking”.

He said other branches at Hamile and Fielmuo could register and issue ATM cards to clients to be used anywhere in the country.
“At a later date, all our branches will be hooked on our 24-hour banking services through the ATM,” he said.

The District Chief Executive for Nandom, Thaddeus Arkum Aasonglenang, praised the bank for its sound management which had ensured its continuous operation over the past 36 years.

He said the bank had been of great service to the local people by facilitating the growth of the local economy through loans and other services that would ordinarily be inaccessible to persons in rural areas.

He urged the management to study the financial sector and take advantage of emerging opportunities, including the National Lotteries Authority’s products, to expand and increase its profitability.