Odotobri Rural Bank PLC has written off locked-up funds totaling over 3.5 million cedis invested in two financial institutions affected by the banking sector clean-up.
According to management, the decision to write off the investments will not negatively affect the institution due to the robust financial statement.
The institutions that held these investments are Gold Coast Securities and SIC Financial Services Limited.
According to the Bank’s 2024 Financial Report, an outstanding balance of 3.8 million cedis remains with the National Trust Holding Company.
Of this amount, 105,000 cedis was recovered during the year under review.
Chief Executive Officer, Abraham Coffie, explained that writing off the locked-up funds ensures the Bank complies with International Financial Reporting Standards by removing non-existent assets from its books.
“Writing off such investments does not mean they are completely removed from the books. In the likely event that the receiver or Bank of Ghana honors their obligation, it becomes another income source for the Bank,” he added.
Mr. Coffie added “because the Bank is robust in terms of Capital Adequacy Ratio, its risk absorption capacity is very high. We have met the Bank of Ghana’s industry benchmark of 10 percent.”
The government’s Domestic Debt Exchange Program converted bonds worth 30.2 million cedis held by the Bank, which negatively affected the repayment of some investments.
Board Chairman of the Bank, Benedict Boadi, believes the release of these bonds will further improve the Bank’s operations and positively impact profitability.
Profit Margins
Odotobri Rural Bank PLC recorded a profit margin increase of over 117 percent for the year 2024. This marks a significant rise from the 13.6 million cedis recorded in 2023.
According to the Bank’s 2024 Financial Report, the improvement is largely attributed to increased deposits and investments during the review period.
Available data indicates that deposits increased by 64.15%, representing over GH¢516 million, while investments rose by 65.89%, totaling over GH¢398 million.
To the Board Chairman, “this increase was due to intensified mobilization efforts by Directors, Management, and Staff, coupled with growing public confidence in the Bank’s catchment area.”
Advances also increased by 42.21%, reaching over GH¢80 million.
Dividend Declaration and Corporate Social Responsibility
Following the improved financial performance, the Board of Directors has increased shareholder dividends to GH¢0.0075 per share.
This represents a 74.42% increase over the previous year’s dividend.
The proposed dividend amounts to GH¢2,420,674, representing 12.16% of profit after tax.
In the area of Corporate Social Responsibility, GH¢369,143.48 was invested in the Bank’s catchment communities to support various socio-economic initiatives.
Beneficiary areas included education, health, traditional support, and assistance to the Ghana National Fire Service, Ghana Prisons Service, and the Ghana Police Service.
In 2026, the Bank plans to open a new branch at a strategic location to grow its market share.
The Bank’s electronic channels will also receive critical attention as part of its expansion and customer service enhancement initiatives.
Source: Nana Yaw Gyimah