Financial Growth and Performance Highlights
Otuasekan Rural Bank PLC, located in Kofiase within the Sekyere West District of the Ashanti Region, has demonstrated significant growth in all financial indicators for the 2024 year under review. The bank recorded a profit before tax of approximately GH¢13.1 million, a substantial increase from the little over GH¢5 million recorded in the previous year. This represents a remarkable 153.1% growth in profits.
The rise in profit can be attributed to improved revenues from operations and prudent management of recurrent expenditures, both by the Board, Management, and the entire staff. The Board of Directors commended the management and staff for this impressive growth, which translates into an absolute profit increase of GH¢7.9 million. They have urged continued efforts to enhance the bank’s profitability and, in turn, increase shareholder investments.
Directors have also been recognized for their strategic direction and decisiveness in achieving these results.
Dividend Payment and Shareholder Returns
The Board of Directors proposed a total dividend payment of GH¢2,000,931, translating to a dividend-per-share of GH¢0.1585p. This provides a return on a dividend of 31.7% on the current share price of GH¢0.50p, with regulatory approval granted for the payment. The Board hopes that the bank’s performance will continue to improve, enabling consistent dividend payments in the future.
Stated Capital and Shareholders’ Funds
In the 2024 year under review, the bank’s stated capital grew by 17.11%, increasing from GH¢3.49 million in 2023 to just over GH¢4 million in 2024. Shareholders’ funds also increased by 23.33%, rising from about GH¢15.9 million in 2023 to approximately GH¢19.6 million in 2024. This growth resulted from unprecedented profits and rigorous sales of ordinary shares.
Despite the growth in share capital, the bank is strategizing to attract new shareholders and encourage existing ones to invest more in the bank’s stated capital. This will accelerate the bank’s growth and enable it to expand its operations and enhance profitability for its shareholders.
The Chairman of the Board of Directors, Kwadwo Nkansah-Fordjour, announced these details at the bank’s 36th Annual General Meeting of shareholders held last Friday in Mampong Kofiase, Ashanti.
Operational Environment and Macroeconomic Context
According to the Chairman, Ghana’s real Gross Domestic Product (GDP) grew by 3.6% year-on-year in the fourth quarter of 2024, driven largely by Information and Communication, Financial and Insurance Activities, and Manufacturing sectors. The annual inflation rate in Ghana for December 2024 was 23.8%, compared to 23% during the same period in 2023. The Bank of Ghana Monetary Policy Rate ended the year at 27%, down from 30% in 2023, while the 91-Day Treasury bill rate ended the year at 27.7%.
During the 2024 year under review, rural and community banks (RCBs) played a pivotal role in boosting the nation’s economy, especially in advancing financial inclusion and providing credit to the Small and Medium-sized Enterprises (SMEs) sector. Despite macroeconomic challenges, these banks showed resilience and innovation, significantly impacting local economies and underserved communities.
The banking sector remained resilient amid macroeconomic challenges. Total assets grew by 33.3% to GH¢323.2 billion as of June 2024, driven by robust growth in deposits and other funding sources. Profitability indicators showed improvement, with the sector remaining profitable and well-capitalized. The Capital Adequacy Ratio (CAR) with reliefs stood at 14.0% in December 2024, up from 13.9% in December 2023.
Key Financial Indicators
| Indicator | 2024 Amount (GHS) | 2023 Amount (GHS) | % Change |
|---|---|---|---|
| Deposits | 293,780,833 | 192,008,924 | 53 |
| Investments | 207,669,197 | 107,532,183 | 93.12 |
| Advances | 59,432,749 | 53,696,447 | 10.68 |
| Total Assets | 335,922,009 | 217,721,193 | 54.29 |
| Share Capital | 4,028,486 | 3,439,835 | 17.11 |
| Shareholders’ Funds | 19,565,478 | 15,864,107 | 23.33 |
| Profit before Tax | 13,124,646 | 5,185,350 | 153.11 |
Corporate Social Responsibility
The bank continues to support various state institutions and stakeholders within its catchment areas. Projects supported during the year included those of Traditional Councils, the Ghana Education Service (GES), the Ghana Police Service, government health facilities, and Farmers’ Day Celebrations. A total of GH¢170,120 was spent on CSR programs for local communities.
The Board Chairman emphasized the bank’s commitment to social responsibility and pledged to continue supporting projects and engaging in environmentally friendly activities in the future.
Commendation and Advice
Leonard Maasang, the Kumasi Manager of ARB Apex Bank, delivered an address on behalf of the Managing Director, Alex Kwasi Awuah. He congratulated the shareholders, Board, and Management of the Bank for the exceptional performance. He commended the Board for strategic leadership and the Management for operational efficiency and integrity. He noted that the 2024 results show Otuasekan Rural Bank is becoming a model of growth through prudence and innovation.
He advised the bank to deepen its adoption of digital tools such as agency banking, mobile banking platforms, and GhanaPay solutions to enhance service delivery, expand outreach, and reduce operational costs.
Outlook and Future Plans
John De-Graft Owusu, the Chief Executive Officer of the Bank, stated that the bank would continue to provide good services and develop need-based products for its customers. He affirmed that Otuasekan Rural Bank remains a pillar of financial resilience and community empowerment. According to him, the bank’s performance reflects prudent management, operational efficiency, and the trust placed in them by customers and stakeholders.
“We are poised to make significant strides in expanding our digital banking platforms, deepening financial inclusion, and supporting local enterprises, especially in underserved areas. These achievements are a testament to our commitment to innovation, transparency, and sustainable growth.”
Mr. De-Graft Owusu expressed his team’s excitement about the opportunities ahead, emphasizing their focus on enhancing customer experience, strengthening risk management, and investing in staff development to boost profitability.
