The Lower Pra Rural Bank Limited’s net profit before tax of GH¢2,068,202. 66 recorded in 2012 dropped by 47 per cent to 1,095,535.27 in 2013, Mr. Nathaniel Arthur, Chairman of the Board of Directors, told the Bank’s 26th annual general meeting of shareholders at Shama at the weekend.

In his report, he said the year 2013 was challenging to all rural banks in the country and that the reduction in profit was the result of non-payment of loans.

Mr. Arthur said payment of school feeding loans also contributed greatly to the overdue loans and the bank hoped to recover all overdue loans.

He said the bank in partnership with Freedom from Hunger (FFH) established the Women in Development (WID) project in 1992 and the project consist of women groups formed to develop savings culture among members.

Mr. Arthur said as at December 31, 2013, 167 Credit and Savings Associations had been formed with a total membership of 2,505 and the bank granted loans totaling 2.5 million Ghana Cedis to women groups in the year under review, adding that total savings stood at 229,645 Ghana Cedis.

He said total deposits increased from GH¢37.3 million in 2012 to GH¢42 million in 2013.

Mr. Arthur said the economic situation had an effect on the bank’s deposit mobilization but has been rectified through strategic measures formulated and implemented by management.

He noted with concern the failure of some loan customers to service their loans to enable the bank extend credit to other customers, saying the bank will vigorously pursue recalcitrant loan defaulters with all measures including court actions to recover overdue loans.

Mr. Arthur said the bank spent 397,177 Ghana Cedis to support developmental activities in its catchment area in the area of education, health and community initiated projects, among others.

He said the bank also donated electrical materials, paints, bags of cement, text books and personal computers to Primary and Junior High Schools to facilitate teaching and learning.

In an address read for him by Mr. Dominic Barimah, the Manager of General Services, Mr. Kwadwo Aye Kusi, Managing Director of the Association of Rural Banks (ARB) Apex Bank Limited, appealed to the management of the bank to sharpen their treasury management skills, and improve the bank’s services on commission and free-based products.

He said management must also develop more products that are demand oriented to diversify the bank’s income streams and ensure that the loans portfolio remained healthy to enable the bank extend loans to more customers in order to raise the level of profitability.

Mr. Kusi asked the bank to build excellence in customer service into its performance contracts of staff and tied to their periodic appraisal and payment of bonuses.

He said the banking landscape is changing with respect to regulation, technology, competition, governance and customer expectations.

Mr. Kusi said Rural and Community Banks (RCB) are expected to promptly respond to these changes through new and improved products and services, and hoped that the Lower Pra Rural Bank would prove equal to the challenges ahead.