For the first time in three years, shareholders of Amenfiman Rural Bank will receive returns on their investments, as the bank has announced a 35 percent dividend on shares.
The Bank has been profitable over the period, but payment of dividends stalled due to a Bank of Ghana’s directive in the implementation of the Domestic Debt Exchange Program with the IMF.
The announced payment of dividends has come as a relief to shareholders
Returns on investment in shares of rural banks are a major source of revenue for some shareholders of rural banks.
For fifteen years, a retired educationist, Daniel Serbeh has been a shareholder of Amenfiman Rural Bank.
The dividends from the shares held at the bank has helped cushion him financially as his pension pay is unable to cover all expenses.
Daniel says the halt in payment of dividends due to a directive from the Bank of Ghana was not received lightly.
“I survive on the amount received as dividends from the Bank. It has been helpful. I hope this continues because I will need money to cater for feeding and medication at my age”, he said.
The move of the Central Bank to halt payment of dividends was also aimed at building the Capital Adequacy Ratio of banks and specialized-deposit taking institutions, aside from the economic challenges of the country.
For the 2023 financial year, the regulator has requested banks with the capacity to pay dividends to present their financials for approval.
Profits and stated capital
In the year 2023 financial year, Amenfiman Rural Bank PLC achieved remarkable strides in profitability, the Bank’s net operating profit before tax surged by 127%, soaring to GH¢24 million from GH¢10.70 million in 2022.
Additionally, return on equity rose to 13.6% in 2023, up from 13.3% the previous year, underscoring adept utilization of shareholder equity to drive substantial profit growth.
By the figures recorded, the bank realized a robust and encouraging increase in profits attributing the gains to strategic emphasis on meticulous cost management and a deliberate shift towards high-margin products.
The Bank achieved substantial rise in its capital base to support the growth plan whiles adhering to regulatory requirements. Stated capital rose from GH¢9.67 million to GH¢10.5 million in 2023 representing 8.60%.
The growth in capital has further strengthened the capital base of the Bank making it strong and robust to pursue its strategic programs.
Deposits mobilisation
In the year under review, deposits increased to GH¢768 million, from GH¢557 million in 2022, representing a 37.97% growth.
Leadership attributed the growth to exceptional service delivery, loyalty of customers to the Bank’s services and dedication of staff.
Though the opening of the new agencies and mobilization centers contributed to the growth, staff worked towards ensuring the new customers were captured.
An ambitious target of a billion cedis deposits by end of 2024 has already been achieved by July this year.
Amenfiman Rural Bank is the first to achieve such a feat in deposits
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