Kumawuman Rural Bank posts 143% profit increase

The Kumawuman Rural Bank PLC in the Sekyere Kumawu District of the Ashanti Region posted a profit before tax of GH¢3.8 million in 2023, which shows a significant turnaround from the GH¢8.9 million loss posted the previous year.

The loss in 2022, according to the bank, was a result of the implementation of the Domestic Debt Exchange Programme (DDEP), which led to the impairment of the bank’s investment in government bonds.

The bank’s balance sheet, however, remained strong, with total assets of GH¢263.41 million, indicating a growth of 35.3 per cent compared to GH¢194.68 million in 2022.

The Board Chairman of the bank, Dr Alex Adomako-Mensah, delivering the bank’s 2023 annual report, stated that the bank recorded strong financial results for the year, which were attributable to aggressive deposit mobilisation.

Total revenue grew by 55.86 per cent from GH¢27.43 million in the year 2022 to close at GH¢42.75 million in the year 2023. 

Total expenditure also grew marginally by 7.82 per cent to close at GH¢38.94 million as compared to GH¢36.11 million in the year 2022.
Customer deposits reached GH¢255.02 million, up by 32.55 per cent, driven by improved product offerings and increased customer confidence in the brand.

Proactive engagement 

Dr Adomako-Mensah explained that the bank's enhanced and proactive engagement with customers also boosted deposit growth.

He said this performance underscores the dedication and resilience of the management and staff which position the bank for continued success in the future.

"We appreciate the continued support by our loyal customers and the hard-working staff of the bank,” he said.

He said the capital of the bank grew significantly from GH¢2.96 million in 2022 to GH¢3.67 million, showing 24.07 per cent growth in 2023.

"We believe that the strength of our balance sheet, risk management practices, customer confidence and digital banking will be the catalyst that will drive our financial performance over the coming years,” Dr Adomako-Mensah stated.

Capital restoration 

In line with the capital restoration plan, the board chairman said the bank mobilised additional capital of GH¢712,971 and also made a profit after tax of GH¢1.54 million in 2023, contributing towards achieving the objectives of the plan.

Dr Adomako-Mensah said in pursuance of the bank's vision to promote community development within the catchment area, the bank extended support to communities, institutions and projects to the tune of GH¢479,181. 

Future strategic priorities 

Dr Adomako-Mensah said the board, through management, was still pursuing its strategic agenda to become among the first five top lists of rural and community banks in the country. 

Given that, he said the board and management have been engaging in aggressive deposit mobilisation by developing new products and services and strategies to maintain the growth of the bank's deposit and total assets.

"In addition to the above, the board and management have adopted effective measures in managing credit and other operational risks which will result in the reduction in our nonperforming loans and assets, while ensuring equitable distribution of the assets of the bank by granting quality loans and investing in low-risk investment sectors to maximise profitability,” Dr Adomako-Mensah added.