AgriBusiness
ADB’s profitability dips to GHS 2m in Q3 2023
In a challenging financial quarter, Agricultural Development Bank (ADB) reported a significant decline in net profit, with Q3 2023 figures showing a mere GHS 2 million compared to the GHS 41.8 million net profit in the same period the previous year. This represents a staggering GHS 39.8 million drop in net profit on a year-on-year basis.
Despite showing growth in net interest income and operating income, standing at GHS 397 million and GHS 621 million, respectively, the bank struggled with a myriad of issues, ultimately impacting its profitability.
Personnel expenses, impairments on loans and advances, as well as financial assets and other expenses, were identified as key factors contributing to the drastic decline in net profit year-on-year.
ADB’s assets saw notable growth, surging from GHS 7.1 billion in Q3 2022 to GHS 9.3 billion in Q3 2023, indicating a substantial GHS 2.2 billion increase in asset value over the year.
Driving this asset surge was primarily the expansion of the bank’s investment securities, which grew from GHS 1.5 billion to GHS 2.2 billion within the review period. Loans and advances to customers stood at GHS 3.8 billion, while cash and cash balances amounted to GHS 2.3 billion.
The bank’s liabilities also saw significant growth, reaching GHS 8.6 billion in Q3 2023, compared to GHS 6.1 billion in Q3 2022. Deposits from customers contributed substantially to this increase, reaching GHS 7.7 billion at the end of Q3 2023, up from GHS 5.2 billion in Q3 2022.
ADB’s loan asset quality raised concerns, with the non-performing loan (NPL) ratio climbing to a troubling 34% in Q3 2023, up from 25% in Q3 2022. This escalation in NPL ratio indicates a heightened risk of loan defaults.
The bank’s Capital Adequacy Ratio (CAR) plummeted to a mere 1.3% at the close of Q3 2023, marking a substantial decline from the 10.4% CAR recorded in Q3 2022. This CAR level is significantly below the industry’s average CAR of 14%, raising red flags about the bank’s capital adequacy.
-
Business3 weeks agoDr. Nick Danso Adjei Clinches “Entrepreneur of the Year” for Second Consecutive Year
-
General News2 weeks agoPhilanthropy Conference: Ibrahim Tanko Eulogizes Ghanaian for relief efforts towards Akosombo Dam Spillage Victims
-
Education4 weeks agoP K Amoabeng Scholars Program Inaugurated
-
Features and Opinions4 weeks agoHM King Mohammed VI Speech to Extraordinary Arab-Islamic Summit
-
Banking and Finance3 weeks agoNew Climate Finance Knowledge Hub Opens Up Opportunities For Financial Institutions, MSMEs in Ghana
-
Life & Style3 days agoAnum Chief urges immediate gov’t action to avert ethnic conflict in Asamankese
-
General News4 weeks agoGhana Chamber of Mines Donates GHc2.4m To Support Victims Of Akosombo Dam Spillage
-
Features and Opinions3 weeks agoAmos Aloryi Children’s Home: Providing Support for Children of Adversities