Ecobank Ghana said it is set to pay the GHC400 million minimum capital requirement (MCR) by the Bank of Ghana June this year.
All banks in the country were required to pay the amount by December 31, 2018. Some banks are asking for more time but Ecobank Ghana Managing Director, Dan Sackey said it is ready to pay six months ahead of time.
But that is only possible at a cost to shareholders.
Board Chairman of Ecobank Ghana, Terence Ronald Darko told shareholders at the bank’s Annual General Meeting today that due to the GHC400 million MCR they will not be paid cash dividends for 2017.
He the bank is however giving bonus shares to shareholders, which they can sell for cash, adding that he is confident cash dividends will be paid for the year ending 2018.
Dan Sackey later explained to journalists the bank’s current stated capital is GHC236 million so they will only top it up to GHC400 million by close of June.
He said it is important to note that “Ecobank Ghana is worth over GHC1billion so raising GHC400million to pay the MCR is not a problem – it is a matter of reclassifying funds we already have.”
On the bonus shares in place of cash dividends, Dan Sackey explained that “For every ten shares, a shareholder gets a bonus of one share.”
He assured shareholders that the bank remain strong and healthy in spite of the general challenges facing the financial sector as reported in the last few month.
Meanwhile, the bank’s total revenue for 2017 fell by 7% to GHC1.1 billion compared to 2016, and that was also reflected in the decline in profit from GHC328 million in 2016 to GHC254 million last year.
The bank attributed the decline to relatively flat net interest income, which constituted 67% of its total earnings.
Deposits however grew by 21%, which was significantly higher than the industry average of 12.6%.
Shareholders unanimously approved the appointment of three new board members to a three-year term each; Dr. Ohene Aku Kwapong, Henry Dodoo-Amoo and Dr. John Ofori-Tenkorang.
They also approved of all other resolution unanimously.