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Business News of Saturday, 23 February 2008

Source: GNA

Hohoe gets new rural bank

Hohoe, Feb 23, GNA - Dr Mahamudu Bawumia, Second Deputy Governor of Bank of Ghana (BOG), has said the bank had abolished its policy of approving loans above GHc 2,000 mark in a bid to empower and strengthen the capacity of rural and community banks.

He said by this action, rural and community banks are to submit to BOG returns on loans granted to their customers on monthly basis. Dr Bawumia said this at the inauguration of the Gbi Rural Bank (GRB), a community initiated bank at Hohoe, making it the first licensed bank in the year to start the new capitalization policy pegged at GHC 150,000 for micro and small scale banks. He said all secondary reserve requirements for rural banks have consequently been abolished with their minimum capital requirement of GHC 150,000 and appealed to all rural banks to make up for the shortfall to qualify them to operate.

Dr Bawumia said the 129 rural and community banks were to be networked with banking software the "Globus Emerge" as part of the Millennium Challenge Account compact, urging such banks to reposition their activities or have themselves to blame.

Mr Eric Osei-Bonsu, Managing Director of ARB Apex Bank Limited, urged Board of Directors of rural banks to formulate policies to ensure the orderly growth and development of the banks, comply with codes, laws and regulations and institute effective internal control measures to safeguard its assets.

Mr Kofi Dzamesi, Volta Regional Minister, said apart from the bank meeting the savings and credit needs of individuals and small businesses in its catchments area, it would position itself in the future to sponsor brilliant and needy pupils and students by granting them scholarships.

He said it is expected that the bank would transform the local economy, create jobs and reduce poverty to complement government's efforts at wealth creation.

Dr William Kwesi Agbley, Acting Chairman of Board of Directors of GRB, said the bank's operations would cover agriculture, manufacturing and services, trade associations through co-operative movements and consumer credit finance for workers.

Togbega Gabusu VI, Paramount Chief of Gbi Traditional Area, said the Bank was borne out of inadequacy of finance on affordable lending for the economically viable citizens from the area and urged the people to patronize the facility and honour their contractual commitments.