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Business News of Wednesday, 24 May 2017

Source: citifmonline.com

ADB to save GH¢24m annually from acquiring head office

The Agricultural Development Bank (ADB) has disclosed that its plan to secure where it is currently headquartered, will ultimately save the bank about 24 million cedis annually.

ADB’s earlier decision to pay an annual rent of 5 million dollars at its current headquarters in 2015, generated a lot of controversy between the staff and the management.

The bank is currently in discussions with the owner of the building to buy the facility.

It is unclear how much it will cost.

But speaking on the Citi Breakfast Show, Managing Director of ADB, Daniel Asiedu maintained that the bank will hugely benefit in the end.

“I think the workers are excited because after 52 years, we need our own head office and beyond that it saves us 55 million dollars and will be saving about 24 million cedis because we will be capitalizing it…It is a settled deal and once the new board is inaugurated, then we will continue,” Daniel Asiedu stated.

According to Mr. Asiedu, calculations by the bank have revealed that it will cost it about 14 years’ rent to meet the cost of buying the facility.

“Initially the old board thought it wasn’t possible but I impressed on them to push the owners and find out and they are willing to sell and have given us an offer. Just looking at the yearly rent of 5 million dollars, about 14 years rent can pay for that and the Board has since agreed to this and that is what we are pursuing.”

ADB partners local company to build new head office

Although ADB owns the parcel of land on which the edifice is cited, it entered into an agreement with the developers to build the structure under the name ‘AGRIDEV.’

This was in an agreement which saw the bank owning 10 percent while the developer owned the remaining 90 percent.

The issue came at a time that the company faced stiff opposition by the workers to the management decisions embarked on.

The workers had argued among other things that the MD and the Board were acting in bad faith for allegedly selling the old head office for 10 million dollars and resorting to rent another area at a cost of 1 million cedis per month.

The then MD, Stephen Kpordzi on several occasions denied any such allegations leveled against management.

Stakeholders pleased with turnaround of bank’s performance

Mr. Daniel Asiedu, who succeeded Mr. Kpordzi as MD in March 2016, has also touted the achievements of the bank within a year of assumption of office.

According to him, the bank has enhanced its services including the customer service delivery through the adoption of Relationship Managers concept.

The MD also disclosed that the bank has returned into healthy profitability as deposits have grown from 1.5 to 2.5 billion cedis representing 66% increase between one year period.

Meanwhile Mr. Asiedu is confident of a sustained interest by the yet to be inaugurated Board to pursue the deal and benefit the company.

“Aside from that we are occupying just about half of the building with other companies occupying others. So even if we are able to buy it and take the facility these other rents will be coming to us and in the end we may even end up having to pay a capital amount on a yearly basis that may even not be up to 5 million.”