The Standard Chartered Bank PLC posted a strong performance in the 2021 financial year despite the difficult macroeconomic environment brought about by the COVID-19 pandemic.
Profit before tax of the SCB in 2021 rose to GH¢695 million from GH¢675 in 2020, representing a three-per cent growth.
However, profit after tax of the company declined to by 9 per cent from GH¢478 million in 2020 to GH¢437 million due to the introduction of the Financial Sector Recovery Levy of 5 per cent on profits.
Also, the balance sheet of the bank grew by 26 per cent from GH¢8.0 billion in 2020 to GH¢10.1 billion 2021 and the operating income went up five per cent to GH¢1.1 million in 2021 from GH¢1.02 million in 2020.
In view of the strong performance, the company declared a dividend of GH¢1.84 per share bringing total dividend payment for the 2021 financial year to GH¢250 million.
The Board Chairman of SCB PLC, Dr Emmanuel Oteng Kumah, who disclosed this at the bank’s 52nd Annual General Meeting in Accra on Thursday, attributed the strong performance of the bank to investment in assets that generated better returns.
He said the performance of the bank reflected the general economic conditions that prevailed in the country last year.
Dr Kumah said 2021 was a difficult year due to the COVID-19 pandemic, which created uncertainty in the local and global economy.
In spite of the difficult macroeconomic environment, he said the management and board focused on its strategic priorities which helped the bank navigate the headwinds.
“As a business, he have had to adapt to the constantly changing landscape. We continued to invest in the future of the bank especially in our innovation and technological capabilities and skills to meet the challenges of the new working environment,” Dr Kumah, said.
The outgoing Board Chairman turning his focus on the dividend payment, said the Board recommended a dividend of GH¢2.57 per ordinary share for the 2021 financial year, compared to GH¢1.74 paid in 2020, representing a 48 per cent increase.
However, he said, the Central Bank approved a dividend of GH¢1.84.
Dr Kumah said though the profit after tax of the bank dipped a little, the Board recommended a dividend of GH¢2.57 to help the shareholders “enjoy the profitability of the bank.”
In her remarks, the Chief Executive Officer (CEO) of SCB PLC, Mansa Nettey, said the strong performance of SCB PLC in the 2021 financial year showed the strategic priorities of the bank were achieving the desired results.
“The profitability matrices are showing strong outcomes and this gives us confidence that we are making progress in our strategic priorities,” she said.
Madam Nettey said SCB’s new medium to long-term strategic priorities were network, affluent, mass retail, and sustainability.
Particularly, under the network priority, she said the SCB PlC facilitated the first ever social loan of 280 million euros to the government to develop a section of the Eastern Corridor road, to transform the country’s transport infrastructure to facilitate movement of goods, people and services.
“In 2022, we will build on the second half growth momentum of 2021, our strong underlying business performance, and the great strides made against our strategic priorities,” she said.
Strengthen BoG to fight against use of foreign currency – Economist
The Reverend Dr Samuel Worlanyo Mensah, an Economist, with the Centre for Greater Impact Africa, has called for a strategic policy to strengthen the Bank of Ghana to fight against the use of foreign currencies in the country.
He explained that BoG needed to be resilient in stabilising the Ghana Cedi to compete with other currencies in the global market and also controlling the use of other currencies as the dominant medium for economic transactions.
Rev. Dr Mensah was speaking at the Ghana News Agency Tema Industrial News Hub Boardroom Dialogue, which was on the topic: “Global economy, Russia and Ukraine war, prospects and challenges for Ghana.”
Dr Mensah said the use of foreign currencies in transacting businesses in Ghana was hugely affecting the value of the Ghana cedi.
He mentioned that any perpetrator when caught must be sternly dealt with to deter others from still transacting business with foreign currency saying that, because there had not been any serious action against defaulters, the situation had been the same.
The Economist said the banning of businesses from using foreign currencies was a step in the right direction as when care was not taken, the Ghanaian currency would be made more vulnerable.
“Most of the volatilities that we experience in terms of currency fluctuations and the cedi losing value against international trading currencies are all because we encourage the use of foreign currencies in our domestic market,” he added.
Rev. Dr Mensah explained that the use of foreign currencies in local markets increased their demand and that also led to a negative value in the exchange rate that needed to be discouraged with immediate effect.
He said although foreign business communities contributed to the development of the country, their main aim was to make profits and not necessarily seek to promote the welfare of the locals.
“At the end of the day they only look at their interest and not how their actions or inactions were affecting the local currency,” he said.
He added that transactions between Ghana and another country must not necessarily be in dollars but rather the currency of the particular country Ghana was dealing with.
“If we are buying from China, we should be able to buy from the Chinese Yuan rather than the dollar, if it’s from Nigeria, we use the Nigeria Naira and that will make the cedi very stable and good,” he added. -GNA