HFC records more profit

Accra, April 27, GNA - The Home Finance Company Limited (HFC) recorded a profit after tax of 4.7 billion cedis in 1999 as against 3.6 billion cedis recorded in 1998.

At its ninth annual general meeting in Accra on Thursday, Mrs Stephanie Baeta Ansah, Managing Director of the Company, said this was achieved through the company's resolve to diversify the mortgage portfolio.

She said HFC succeeded in this feat by increasing the mortgage portfolio by 27.2 billion cedis to 89.2 billion cedis for 1999. "With a balanced mortgage portfolio and our commitment to innovation, cost discipline and professionalism, your company shows healthy financial results."

Dividend for the year under review increased by five cedis or 20.8 per cent from 24 cedis in 1998 to 29 cedis in 1999. Over the period under review, HFC's share price on the Accra bourse remained unchanged at 750 cedis.

Mrs Baeta Ansah said HFC's line of business that is doing very well is the Construction Finance Facility. Under the scheme, real estate developers are provided with financing to construct houses especially for buyers who become mortgage customers.

She said during the year, the company worked with a team of experts from the ABN AMRO Bank under a technical assistance programme funded by the International Development Agency, the soft loan arm of the World Bank.

The programme, she said, was structured to prepare the company for diversification into new business areas and to upgrade information technology. The Managing Director said HFC's two managed funds, the HFC Unit Trust and HFC-REIT held their own on the market. They posted yields of 25 per cent and 20 per cent respectively.

She explained that HFC-REIT more than realised its target by overcoming the rate of inflation, which averaged 15 per cent in the year under review. "We expect competition in the future as the Securities Regulatory Commission (SRC) gears up to license other funds. Being the first in the field, however, we are determined to keep our lead in the business and assure our investors of satisfactory returns on their investments."

Mr Samuel Kortei Botchway, Chairman of the Board of Directors, said housing deficit in the country continued to increase from previous years to a current annual supply deficit of an estimated 133,000 units.

Out of this, only 25,000 housing units are provided annually as "only a few banks in Ghana offer mortgage finance." He said HFC, being the dominant housing finance institution, increased the number of mortgages from 2,839 in 1998 to 3,241 at the end of 1999.

The total assets of the Company also increased from 81.3 billion cedis to 119.2 billion cedis as at December 1999. This represents a 46.5 per cent increase in the assets.

Mr Botchway said the company continues to place emphasis on recruiting talented young professionals and equipping them with first class training programmes both locally and overseas to be able to stay in competition.

Highlights of the financial results include a total dividend of 1.6 billion cedis as against 1.4 billion cedis in 1998. Growth in shareholders' funds rather declined by a huge margin from 144.4 per cent in 1998 to only 23.1 per cent.

Stated capital remained at 8.02 billion cedis at the end of 1999. Mr Ken Ofori-Atta and Mr Henry Dei were re-elected to serve on the board.