Managing Director of GCB Bank, Kofi Adomakoh has assured shareholders of the bank of resuming dividend payments in the near future.
According to Adomakoh, the bank’s inability to pay dividends has been due to the adverse impacts of the economy on its operations asserting that the bank’s fortunes are tied to the economy.
Making the assertion during an interview on the sidelines of the bank’s 2024 Annual General Meeting, Mr Adomakoh noted that the bank is not yet out of the woods.
“Dividend payment to shareholders is important, but our bank has gone through a pretty rough patch over the last two to three years and it has impacted our capital significantly.
“The bank has been paying dividends over the years, it’s just the challenge of the last three years which caused us a bit of a hiccup.
But we are getting back on track, we are working hard and I’m happy to say that from the results we have seen, we’re getting out of the woods and we will return to paying dividends in the near future,” he posited.
Meanwhile, the Bank of Ghana (BoG) has granted permission to banks that have made significant progress in their recapitalization efforts to distribute interim dividends to shareholders.
This decision follows the cessation of dividend payments by banks for two years per the directive of the BoG following the impact of the Domestic Debt Exchange Programme on the bank’s operations.
According to the Governor of the Central Bank, Dr. Ernest Addison, only banks with strong capital positions would be allowed to make dividend payments.
The Governor highlighted that the decision is made on a bank-by-bank basis, ensuring that only banks with robust capital positions are permitted to distribute dividends.
This decision is taken on a bank-by-bank basis to ensure that only those with robust capital positions are permitted to do so,” he explained.
GCB Bank for the 2023 fiscal year posted a remarkable performance indicating resilience following a robust post-DDEP recovery and also laying the foundation for a sustainable future.
The Bank reported a substantial profit before tax of GHS 1,547.4 million, transitioning from a loss of GHS 743.5 million in 2022.
The Bank achieved strong revenue growth across its business segments, emphasizing its diversified business model amid market challenges.
Total revenue for the period reached GHS3,784.2 million, marking a 26 percent increase from the previous period’s revenue of GHS3,005.7 million.
Net Interest Income (NII) reached GHS2,895.7 million, showcasing a substantial growth of 37 percent compared to the prior financial year.
Net fees and commission income for the year increased by 14 percent to GHS438.2 million, compared to GHS385.0 million in 2022.
The Bank’s balance sheet improved significantly over the previous year, growing from GHS 21,494.4 million in 2022 to GHS 27,155.7 million in 2023, indicating an increase of 26 percent.
This growth was primarily driven by an increase in customer deposits by 23 percent to reach GHS 21,781.4 million, compared to the GHS 17,775.1 million recorded in 2022.
Shareholders’ funds rose from GHS 1,998.9 million in 2022 to GHS 3,080.1 million in 2023, reflecting a 54 percent increase.
In 2023, the Bank’s financial performance indicators showed a positive trend. The Bank recorded Earnings per share (EPS) of GHS 3.81, Return on Equity (ROE) of 40 percent, and Return on Assets (ROA) of 4 percent.
Furthermore, the Capital Adequacy Ratio (with regulatory forbearance) stood at 19 percent, surpassing the regulatory limit of 10 percent and the prior year’s figure of 18 percent.