Cal Bank shareholders forgo dividends to help meet minimum capital requirement

Shareholders of CAL Bank Limited, a wholly owned and managed Ghanaian Bank, have unanimously approved a decision by the Bank not to pay dividends accruing from profits posted in its audited accounts of 2017. 

This is to enable the bank shore up capital to meet the Bank of Ghana's new minimum capital requirement of 400 million Ghana Cedis by 31st December this year.

The move follows the board's resolution to move some 250 million Ghana Cedis from its income surplus account to Stated Capital to increase the Bank's Stated Capital to 350 million Ghana Cedis before the end of the first half of this year. 

Putting the motion before the members at the Bank's Annual General meeting in Accra, Board Chairman of the Bank, Mr. Paarock VanPercy told shareholders that, "after thorough consideration, your board has opted for the option to capitalise the Bank's income surplus as we seem it the most appropriate at this time considering the amount on the income surplus account, and to avoid asking shareholders to infuse more capital." 

He further explained that "your board is not recommending the payment of a dividend as this will have the consequence of reducing funds available for capitalisation." 

Mr.  Van Percy however indicated that in lieu of the dividend payment, the board will compensate shareholders with a bonus issue of shares. The board chairman further gave assurance that the Bank is well placed to meet all the regulatory requirements to ensure it remains a strong institution operating in a strengthened industry. 

The Managing Director of the Bank, Frank Adu Jr. was emphatic that the Bank will be able to raise all outstanding amounts for the recapitalisation threshold within the final half of the year in order not to fall foul of the regulation. 

CAL Bank Limited has further indicated its commitment to branchless digital banking in order to bring more convenience to its shareholders and clients. 

Story filed by: Nana Agyeman Prempeh.

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