The Agricultural Development Bank (ADB) chalked very appreciable financial results during 2020 despite the tumultuous impacts of the COVID-19 pandemic with a 445.81% growth over 2019.
The bank recorded a profit before tax of GH¢97.7 million for the year ended 31 December 2020 over the GH¢17.9 million recorded in 2019.
Bottom-line profit also grew by 341.89% recording GH¢65.4 million over the GH¢14.8 million recorded in 2019.
Managing Director of the bank, Dr. John Kofi Mensah who disclosed this indicated that the increase in profitability was driven by strong performance in treasury and credit operations funded by an aggressive deposit drive.
This was contained in the Managing Director’s Report in the 2020 Annual Report and Financial Statement of ADB.
He observed that operating in an environment more uncertain and challenging than any in recent times, all the operational performance indices of the bank have seen very significant improvements compared to 2019.
“The net interest income was GH¢415.4 million for the year ended 31 December 2020 (2019: GH¢ 300.1 million), representing a 38.42 per cent increase. This was mainly driven by booking quality loans and the effective monitoring of the loan book.”
“Our relentless focus on cost efficiency led to a reduction in cost to income ratio from 92 per cent (2019) to 78 per cent (2020). This achievement was in line with measures dictated in our revised strategic plan,” he stated.
He disclosed that ADB was positioned to leverage its unique strength in agribusiness to increase the agric share in its asset portfolio, which culminated in loans and advances experiencing a sharp growth of 30% over net loans and advances in 2019.
Mr. Kofi Mensah noted that the Bank in 2020 demonstrated the value of its diversified and robust business model with significant strides exhibited in the e-banking space by providing payment solutions that are safe, secure, and convenient to customers.
The bank, he said, was able to decongest banking halls with the USSD application that enabled customers to have access to their accounts and also perform basic banking activities, which allowed seamless transfer of funds across networks and easy payments.
According to him, in line with its strategic objective to increase the agricultural loan portfolio to 50% of the bank’s total loan portfolio, the Bank in 2020 deepened its financial intermediation to players in the agricultural value chain.
He said, “To provide a ready market for the expected increased farmers’ output under the Planting for Food and Jobs, the Bank approved an amount of GH¢70.0 million as working capital to the National Food Buffer Stock Company Ltd (NAFCO) to buy off excess produce for storage as buffer stock.”
The Bank, he said, remains an active partner for the implementation of the novel One District One Factory Programme (1D1F), and approved total loans of about GH¢104.00 million in favour of some seventeen viable projects to undertake among others broiler production and processing, fruit processing, general manufacturing, construction, jute bags production as well as fish farming and processing.
He stated that ADB also launched a broiler revitalization programme with a total of GH¢500.00 million of soft loans to businesses in the broiler value chain and also introduced an out-grower scheme to support local raw material based industries and processing factories.
According to him, the Bank, for the year under review, attained the ISO 27001 certification for meeting its broad objectives of Confidentiality, Integrity and Availability and is looking forward to streamlining all other areas of the bank and adopting other management systems such as Quality Management System – QMS
(ISO 9001), Business Continuity Management – BCMS (ISO22301), IT Services Management – ITSMS (20000) and Enterprise Risk Management – ERM (ISO 31000), which will constitute the ADB Integrated Management System.
“The Bank continued to receive recognition and awards from research-based publications and awarding institutions for its sterling performance and strategic contribution to wealth creation through agribusiness.”
“In the year under review, the hard work and commitment of management and staff ably guided by the Board won the Bank several awards and recognition that included Excellence in Leadership in Cocoa Financing at the 2nd edition of the Cocoa Awards and 4th Most Visible Financial Institution Brand of the Year by the Institute of Brands Narrative Analysis.
Dr. Kofi Mensah stated that despite the challenges of 2020, ADB has managed to differentiate itself from competition in the universal banking space and continues to maximize the values of the shareholders.