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Rural Banks urged to support LESDEP

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Rural Banks have been asked to explore ways of supporting the Local Enterprise and Skills Development Programme (LESDEP), which was recently launched by the government.

The banks were also tasked to ensure that the government’s policy of Pre-Financing the Disbursement of the District Assemblies’ Common Fund comes to fruition.

Prince Askia Mohammed, Savelugu/Nanton District Chief Executive, made these appeals in an address read for him at the Fourth Annual General Meeting of Borimanga Rural Bank at Savelugu at the weekend.

He said the government had created the enabling environment for the banks to operate efficiently by ensuring that the depreciation of the cedi had been arrested, while inflation had also been reduced to a single digit.

He, therefore, appealed to the banks to reciprocate the Government’s efforts by translating the favorable indicators into low base rates and other favorable business transactions with the public.

“It is only through this that you can be seen to be properly complementing the efforts of Government at improving the quality of lives of our people,” Prince Mohammed said.

The DCE further urged rural banks to provide tailor-made facilities for the rural people who are mostly engaged in agriculture as their source of livelihood.

Alhaji Amadu Montia, Board Chairman of the Bank, said due to the keen competition now in the banking sector, with the bigger commercial banks now expanding into the rural areas, rural banks could overcome this competition when they concentrate on micro-credit where they have a comparative advantage.

He stated that the bank recorded a net profit of GH¢27,576.00 for the financial year 2010 as against GH¢49,335 for the year 2009, a decrease of 44 percent.

He attributed the fall in profits to the slow pace of recovering MiDA loans and also over aged agriculture and working capital.

Alhaji Montia announced that the Bank has met the new capital requirements of GH¢150,000.00 for rural and community banks, saying that as at December 2010 the stated capital was GH¢152,643 as against GH¢135,543 for the same period in the year 2009, representing an increase of 11 percent over the 2009 figure.

Mr Eric Osei-Bonsu, Managing Director of the ARB APEX Bank Limited, in a speech read for him announced that the APEX Bank would soon establish a unit to manage share issues for the Rural and Community Banks (RCBs), including the payment of dividends and other related services, which, he said, was intended to boost investor’s confidence in the RCBs.

He said the bank was also in the process of creating a special unit to provide custodial services for RCBs tiers 11 and 111 pension contributors to make delays associated with the payment of pensioners a thing of the past.

Source: GNA

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