Rural, community banks want corporate tax reduced
Rural and Community Banks (RCBs) have appealed to the government to reduce their Corporate Tax from 25 per cent to 15 per cent to enable them to retain part of their profit to embark on more corporate social responsibility projects within their catchment areas
They also trust that such a move will go a long way to assist in stemming the rural -urban migration among the youth, a development they said has reached an alarming rate.
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At the 31st Annual General Meeting of the Sonzele Rural Bank at Jirapa in the Upper West Region at the weekend, the acting Managing Director of the ARB Apex Bank, Mr Alex Awuah, who made the appeal, also urged the Bank of Ghana (BOG) to lift the ban on payment of dividends as soon as practicable to entice more people to buy shares in the banks.
That, he said, would go a long way to improve the liquidity position of the banks and also increase their clientele base.
"It must be noted that banks are recognised not by profits they make nor the expansive drives but by the provisions of some of these corporate social responsibility for the people wherever they operate", Mr Awuah noted.
He commended the Sonzele Rural Bank with its headquarters at Jirapa for posting a modest profit after tax of GH¢644,033 as compared to the GH¢594,440.00 in 2019.
That represents an eight per cent increase.
The feat chalked up by the bank is notwithstanding the COVID-19 pandemic restrictions.
Commendments
Mr Awuah commended the bank for going as far as to place first in the National Efficiency Monitoring Unit (EMU) ranking of the RCBs by the ARP Apex Bank as against the third position the previous year.
Such enviable achievement, he cautioned, should not make them complacent and thus rest on their oars but rather strive to consolidate the gains with more hard work.
He also commended the Sonzele Bank for putting up measures to adhere to good corporate governance practices aimed at promoting the interest of shareholders and depositors.
Mr Awuah also praised the bank for exceeding the BoG capital requirement threshold of GH¢1million.
Financial results
In his report, the Board Chairman of the bank, Mr Mathias Samwine, said the bank undertook what he described as a rigorous deposit mobilisation exercise and managed to increase deposit to GH¢22,635,101 from GH¢16,661,457 the previous year.
This represents an increase of 36 per cent.
This, Mr Samwine said, resulted in a pre-tax profit of GH¢716,675 in the year under review as against the GH¢792,587, the previous year.
"On total assets, the increase in the bank's assets base to GH¢28,347,781 during the year under review from GH¢22,976,231 in 2019 constituted an increase of 23 per cent.
That meant that more resources were at their disposal for use to generate more income and ultimately increase in shareholders' value," he said.
Challenges
The board chairman said the bank has always been committed to its corporate social responsibility to enhance its relationship with the communities.
He said their biggest challenge over the years has been the bank’s Information Communication (IT) connectivity for five branches and customers.
