Shareholders of Akyempim Rural Bank Limited have mandated the Board and Management of the Bank to continue partnership negotiations with Amenfiman Rural Bank for a turnaround of the Bank’s fortunes.
The shareholders gave their mandate at an extraordinary meeting of the bank at its main office at Gomoa Dawurampong.
This followed briefing by the Board Chairman, Mr. Alex Benedict Coffie of the Board’s decision to seek approval to shop around for a strategic investor to inject both equity and debt capital into the bank to re-position it competitively in the face of the current banking brouhaha.
“You will recall that in May 2015, circumstances compelled the former Board of Directors of the bank to declare the bank distressed and invited ARB APex Bank for financial support to help stabilise the situation”, he said.
He further stated that three months after, an extraordinary general meeting was held, where the old board members resigned en-block and an interim board instituted to manage the affairs of the bank.
According to Mr. Coffie, the Bank faced serious liquidity challenges during that time, to the extent that it was unable to pay salaried customers whose employers had duly sent their salaries to the bank.
ARB Apex Bank then appointed a forensic auditor to audit the bank’s books and six staff members who were alleged to have been involved in various acts of misappropriation were facing various charges at the law courts.
The new board therefore had series of engagements with the depositors about the financial crises the bank was facing and encouraged them to continue to do business with them for their turnaround.
“It is most heartwarming that none of the previous board members were found to have been involved in any malpractices”.
The Board Chairman took the opportunity to thank all the immediate past board members for their selfless and dedicated services rendered to the Akyempim Bank.
On the financial performance, he announced that the capital of GH¢ 693, 540.27 contributed by existing shareholders fell short of Bank of Ghana’s GH¢ 1, 000,000.00 minimum capital requirement.
Mr Coffie informed the house that the bank currently had an outstanding loan portfolio of GH¢ 2, 925,730.20, out of which 63.99 percent was to be classified as bad and non-recoverable.
Also, an eroded capital base as a result of sustained losses from years of fraudulent dealing by former staff of the bank had left a capital adequacy ratio of negative 171.5 percent as at June, 2019 and shareholders fund of negative GH¢ 5, 842,632.90.
This he said had resulted in inadequate funds for lending to customers and sustained financial losses.
He thanked the Shareholder for the faith they had in the bank by giving the board their blessings to continue with the negotiations for the said partnership with Amenfiman Rural Bank.
Mr Coffie expressed optimism that the bank has the potential to bounce back, if well-resourced to rebrand its operations.