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GCB records 57% growth in profit in 2010

By Kofi Ahovi
Ghana Commercial Bank (GBC) has achieved a much improved financial results in 2010 as compared to the previous year. In 2010, the group’s net income of GHc259.9 million was 57% above that of GHc165.8 million in 2009. The 2009 figure was 7% below the 2008.

The board chairman of the bank, Pryce Kojo Thompson, explained at the bank’s 2010 annual general meeting last week, that the figures achieved for 2010 was significantly due to the impairment charged on loans and advances of GHc70.9 million which was almost twice the 2009 loans impairment charged of GHc36.7 million.

Profit before tax for 2010 was GHc91.3 million, up from 343% from the GHc20.6 million recorded over the same period the previous year despite significant write-downs.

The bank’s operating expenses increased by GHc27.9 million or 19% to GHc168.5 million reflecting increase in staff-related cost, investments in improving delivery platform and IT cost. According to the bank, these increased cost were offset by savings from cost management initiatives that reduced the underlying cost run rate.

The bank’s cost-to-income ratio fell sharply to an unprecedented 51% compared to 70% in 2009. The 2010 results translate to a Return on Average Equity of 25% and Return on Average Assets of 2.8% compared to 9% and one percent respectively the previous year.

Shareholders approve a dividend payment of GHc0.7 peswas per share for the year, which amounted to GHc18.6 million as against the previous year’s dividend of Ghc0.35 peswas per share amounting to GHc9.4 million, representing an increase of 97%.

GCB plans to diversify its business this year by increasing penetration ion other attractive segments including consumer banking, Small and Medium Enterprises and other private corporate entities; invest in consumer service excellence orientation programmes for its staff in order to increase sales and service effeteness; continue with initiatives to overhaul the risk management framework among others.

“We will continue to reposition your bank to take advantage of the opportunities that the government’s agenda for stimulating growth for development and job creation brings to the Ghanaian economy,” the chairman assured.

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