NIB records five billion cedis profit in spite of difficulties
Don't rush to impose restrictions on withdrawals - BOG told
Ghana hosts Tax
Commissioners Conference
Credit Unions ease financial hardships - Guat.
Accra
(Greater Accra) 10 August 2000
The
main market indices of the Ghana Stock Exchange (GSE) marked time again for the
second time in as many trading although total shares traded leaped many times,
thanks to a huge sale of SSB bank shares.
The
GSE All Share Index, the main market indicator, stood still at 820.41 points.
The change for the year and market capitalisation also remained the same at
11.44 per cent and 3,571.21 billion cedis. There was no price change either.
For
the fist time in many trading sessions, the shares traded were close to one
million - 768,000 shares from Monday's 22,800. SSB Bank sold 745,300 shares out
of 760,400 demanded that were put on sale.
Only
two equities - SPPC and Camelot - had positive pressure on them. Ten of the 23
equities had no pressure at all while 11 others had no pressure at all.
Shares
on offer were up from 1.69 million to 2.14 million while bids were up at
860,800 from 51,100.
Below
are the closing prices of listed equities in cedis:
ABL 620
AGC 18,600
ALW
2,600
BAT 440
CFAO 38
EIC 1,880
FML 1,200
GBL 1,400
GCB 1,000
GGL 990
HFC 950
MGL 200
MLC 150
MOGL
17,500
PAF 300
PBC 520
PZ 800
SCB 22,000
SPPC 155
SSB 1,990
UNIL 1,800
UTCE 125
CMLT 425
GRi…/
Accra
(Greater Accra) 10 August 2000
The
National Investment Bank (NIB) recorded a profit of 9.7 billion cedis after tax
representing a growth of 121.8 percent in 1999 compared to four billion cedis
in 1998.
Mr.
Nicholas Akpebu, Chairman of the Board of Directors, who announced this at the
bank's annual general meeting in Accra on Wednesday said the gains were made
under what he described as "challenging conditions."
The
bank was, however unable to declare any dividend because of the difficulties
but promised shareholders an interim dividend in the course of the year.
The
meeting received the report of the board of directors and auditors and approved
the balance sheet as at 31st December 1999.
It
also elected new directors, approved directors' fees and authorised the
directors to fix the remuneration of the auditors.
Mr.
Akpebu said while total income for the bank increased by 74 per cent from 21.9
billion in 1998 to 38.3 billion in 1999, operating expenses totalled 18.4
billion in 1999 compared to 14.8 billion in 1998 representing an increase of
24.3 percent.
The
bank's deposits base rose by 27.1 per cent from 85.3 billion cedis in 1998 to
108.4 billion in 1999. Total assets went up by 23.7 percent from 168.7 billion
in 1998 to 208.7 billion in 1999.
The
bank, he said also registered an increase of 32.4 percent in shareholders funds
from 29.8 billion in 1998 to 39.5 billion in 1999. It however, increased its
bad debt provision to 9.7 billion from 2.2 billion in 1998.
Mr.
Akpebu explained that that situation was largely the result of the
classification by auditors of some of its equity investment as bad debts, even
though it does not form part of the bank's loan portfolio.
"Although
the management of the bank have identified poor loan recovery as a major
problem, they are determined to bring it under control".
He
said in order to keep pace with the competition in the industry and maintain
it's market share, the bank needs to complete its centralised computer network
systems.
The
bank is also determined to improve on its capital adequacy ratio to be able to
assist key customers with facilities within the requirements of the Banking
Law.
"There
is the need to have sufficient reserves to withstand further economic shocks as
well as the huge capital outlay required to keep pace with technology and the
competition in the industry".
Two
of the bank's board members, Madam Faustina Nelson, businesswoman, and Mr.
George Owusu, were re-elected in their absence but the election of Commodore
Steve Obimpeh, who was also absent was deferred.
Commodore
Obimpeh was to replace Mr. Somtim Tobiga as government nominee. The government
holds the majority shares.
Some
shareholders however questioned the banks' decision not to pay dividends but
has allotted 108 million as directors' remuneration for 1999 as compared to 74
million in 1998 an increase of 34 million.
One
shareholder whipped up sentiments when he asked why board expenses increased
from eight million in 1998 to 207 million for the 1999 fiscal year.
There
was booing from a section of the shareholders as the chairman explained that
board expenses had to be increased because transportation for board members
making rounds in the country had to be paid for.
Their
protest was however subdued when the chairman announced that an interim
dividend would be paid later in the year.
GRi…/
Accra (Greater Accra) 10 August 2000
The President of the Ghana Employers' Association (GEA) on
Wednesday advised the Central Bank to desist from rushing to impose
restrictions on withdrawals, saying the order will only increase cash outside
the banking sector.
Mr. Ishmael Yamson, said at the 40th Annual General Meeting of the
GEA in Accra, that banks especially foreign ones, cannot stop any depositor
from withdrawing monies deposited with them.
The Meeting is expected to elect a new President and Vice President,
new Council Members and nominate advisory committee members to replace the
incumbent ones whose term of office has ended.
He said while it is bad practice to allow such large over-
the-counter withdrawals, "there is actually no law which prevents any
depositor from withdrawing money from his or her account.
"Besides, if the dollars were available in the banks, those
corporate bodies would not have gone into the streets to buy dollars, thus
accelerating the depreciation of the cedi."
The Central Bank last week warned large manufacturing concerns and
corporate bodies to stop withdrawing huge sums of money over the counter but
rather, resort to overdrafts and inter-bank transfers, which minimise the
physical movement of cash.
Mr. Yamson advocated the devaluation of the cedi, which according
to him would make it difficult and more expensive to buy dollars.
"What is needed is the realistic fixing of our exchange
rates. When this is done, it will protect the cedi from depreciating, but
sadly, some stakeholders in the market do not favour this idea".
Mr. Yamson condemned corporate bodies that have withdrawn large
sums of money to buy dollars from the open market, saying it was irresponsible,
as it only accelerated the depreciation of the cedi.
"However, these actions clearly demonstrate what damage panic
measures can do to an economy", he stressed.
He warned that the situation might continue if the banks continue
to be unable to provide the required dollars for their clients.
Mr.
Yamson said the situation shows that short-term solutions can only aggravate
the strains on the economy. "High
interest rates kill businesses and frustrate investors...most Ghanaian
businesses are currently distressed."
The
current high tariffs only go to increase the rate of smuggling and the
inefficiency of local industries.
Mr.
Yamson said solutions being offered, "cannot be the right (ones)"
considering the facts that they are driving foreign exchange operations into
the parallel market and expressed regret that promises such as water,
electricity, health, education and housing for all by year 2000 have not been
met.
"We
must be determined that the vision of achieving middle-income status by year
2020 does not pass us by."
Mr.
Yamson said Ghana has pursued an economic recovery programme that has failed.
Hence, the World Bank and the IMF should not continue to pursue the stereotyped
recovery programme and its attendant adjustment programmes indefinitely.
"They
must help Ghana to change direction. Ghana's new thrust must be to change the
very fundamental structures of its economy."
He
called for the creation of an economy which no longer depends on commodity
exports, whether traditional or non-traditional.
"We
should seek to create an economy which is driven by knowledge, technology,
innovation, digital communications, information technology and systems
services, value added manufacturing and modern agriculture."
Alhaji
Muhammad Mummuni, Minister of Employment and Social Welfare, called for the
development of a local raw material base for local industries.
He
also called for the production of substantial proportions of staple foods using
proven local technologies.
Alhaji
Mumuni stressed that Ghanaians need to come to terms with the culture that,
"we grow what we eat, eat what we grow, earn what we deserve and pay what
we can afford."
GRi…/
Accra
(Greater Accra) 10 August 2000
Ghana
is to host the third conference of Africa Commissioners of Value Added and
Goods and Services Tax in Accra from August 17 to 18, 2000.
The
conference will bring together commissioners from African countries operating
the tax systems to deliberate on their implementation in their respective
countries.
A release from the VAT Service on Thursday
did not indicate the number of countries that will attend but said it is
expected to increase over the previous meetings due to the interest shown by
other countries.
The
two earlier meetings were held in Kenya and Uganda. Ghana attended the last
conference in Uganda.
The
release said the Accra conference would discuss among other topics, Taxing the
Informal Sector, Computerization and Training and Capacity building.
GRi…/
Credit
Unions ease financial hardships - Guat.
Tema(Greater
Accra) 10 August 2000
Mr.
David Guat, General Manager of the Ghana Co-operative Pharmacists Credit Union
Limited (GCPUL), has called on Ghanaians to join credit unions since they offer
quality and sustainable financial services at fair and competitive interest
rates.
He
said members of credit unions stand to benefit from easy access to credit at
all times.
Addressing
members of the Tema branch of the GCPUL on Wednesday, Mr Guat said loan
interest goes back helps to increase the savings and dividends of members adding
that members do not need immovable property as collateral for contracting a
credit union loan.
Apart
from loans, other services available are financial counselling, financial and
credit management and free life and loan protection insurance for all members.
GRi…/
Accra
(Greater Accra) 10 August 2000
Buying Selling
Pounds 8600 9000
U.S
Dollar 5700 5900
D.
Marks 2800 3300
Guilders 2500 2700
CFA
Francs 8900 9300
French
Francs 890 950
Canadian
Dollar 3900 4200
Swiss
Francs 3800 3900
GRi…/