Energy Bank Looks Ahead With Hope

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energyBankSince its establishment in 2009 and subsequent commercial banking licence receipt in 2011, Energy Bank Ghana, a subsidiary of Energy Bank Nigeria, has grown from strength to strength.

The bank?s assets, profit, income, shareholder funds, commission and fees, deposits and loans and advances have all seen growth despite the difficult economic terrain and highly competitive market in which it operates.

With these increments across the board, the bank?s outlook for 2014 include increasing its customer base through branch expansion; growth in total assets; growing in risk assets; increase in profit before tax; efficiency in operational costs; and customer loyalty rewards.

The bank recorded a profit before tax of GH?8.02million in 2013 from GH?7.6million in 2012, representing a 6 percent increase. Total assets grew from GH?225million in 2012 to GH?245million in 2013, representing a growth rate of 8.9 percent.

Total shareholders? funds rose by 4 percent from GH?67million in 2012 to GH?70million in 2013, while total income accruing to the bank in 2013 amounted to GH?23.6million, representing a 37 percent increase from GH?17million in 2012.

The main driver of the bank?s performance in 2013 was net interest income, which grew by 33 percent in 2013 to GH?15million. This constituted 64 percent of the total income for the year.

The bank formed a subsidiary during the year under review, known as Energy Investment Limited. Its principal activities include investment advisory, asset and fund management, investment banking, Treasury management and corporate finance.

An initial equity capital of GH?9.8million has been provided for the firm?s take-off in the first quarter of 2014.

The bank also formed a new unit known as the Customer Loyalty and Brand Management Unit. This unit serves as a support base for all other departments. It seeks to help attract, delight and retain cherished customers of the bank.

Loan products

Energy Bank has a number of loan products which include Auto Loans, Consumer Loans and Letters of Credit, Bid Securities, Personal Loans, Asset-Financing Facilities and Corporate Loans.

Main Drivers

The main driver of the Bank?s performance in 2013 was net interest income, which grew by 33percent in 2013 to reach GH?15million. This constituted 64.6 percent of the total income for the year. The bank also strived to achieve efficiency in its operational costs.

1. Loan Products
? Retail Loans
? Auto Loans
? Consumer Loans
? Letters of Credit
? Bid Securities
? Personal Loans
? Asset-financing facilities
? Corporate Loans

2. General Requirements to access loans

Retail Loans
? Must be an account holder for not less than 3 months
? Filled application forms
? National ID
? Credit History
? Salary Slips (3 months)
? Bank statements
NB: The Bank reserves the right to also request any other relevant documents

Corporate Loans (General Requirements)
? Filled application forms
? Certificate of Incorporation
? Audited financial statements for the past three years
? Credit History
? Bank statements
? Security

NB: The Bank reserves the right to also request any other relevant documents

3. Factors that affect our lending rates
The Bank determines its lending rate based on its monthly Base Rate, which is computed in line with the BOG formula introduced in July 2013. Thereafter, a margin is placed on the Base Rate to arrive at the Bank?s lending rate. Other factors that affect the lending rate are as follows:

? Interest on customer deposits
? Deposit mix
? Default rate and
? Operational costs

4. Do you prefer low or high interest rates as a Bank?

Low interest rates are preferred. They increase access to credit by individuals and corporate entities and enable customers to pay back on time.

5. Recommendations

Policyholders should be firm in enforcing existing regulations/laws in the industry.

Periodic monitoring of policy implications should be undertaken in order to advise and review existing policies in the banking industry.

The liquidity reserves should be reviewed by the regulatory authorities to ensure availability of loanable funds.

Source B&FT

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