HFC Bank shareholders approve share buy back plan

Shareholders of HFC Bank, on Thursday approved a resolution to allow the bank to buy back up to five per cent of issued share capital to support the share price.

The approval also authorises directors to open share deals account for the purpose, at its Annual General Meeting held in Accra.

Mr Asare Akuffo, Managing Director, HFC Bank, said the move would help the financial institution to intervene at the appropriate time, to prop up the share price when it declines below its fair market value.

The bank, he said, would also sell some of its holdings when share prices were good.

HFC Bank posted a net profit of GH¢8.64 million from GH¢5.75 million, representing 49.7 per cent growth.

Interest income rose by 10.6 per cent to GH¢54.42 million from GH¢49.20 million while the mortgage portfolio grew by 15.9 per cent to GH¢57.58 million in 2010, up from GH¢51.85 million in 2009, on account of the Public Sector Workers Housing Scheme.

Deposits went up by 27.5 per cent to GH¢156.53 million, leading to a significant increase in the amount of low cost deposits in the bank’s deposit mix.

Mr Akuffo expressed the hope that improvement in the macroeconomic environment would spur growth policies and business activity.

He said although management expected margins to be lower in 2011 due to competitive pressures and the general reduction in interest rates, growth in the bank’s assets, expansion in other business areas and cost control would compensate for the downward pressure on earnings.

The Bank’s Board Chairman, Nana Agyei Duku, said the financial institution would position itself to take advantage of the opportunities presented by the improved economy by reorganising itself to deliver higher returns from all its business segments.

Source: GNA