Ghana: ADB shareholders greenlight GH¢2bn capital injection

A record capital injection of GH¢2 billion has been approved by Agricultural Development Bank (ADB) PLC shareholders to fortify and enhance the bank’s operations.

At an Extraordinary General Meeting (EGM) held at the Accra Financial Centre, shareholders passed a resolution in support of injecting a record GH¢2 billion capital into Agricultural Development Bank (ADB) PLC. This decision aligns with the bank’s objective to augment its minimum paid-up capital, which has been negatively influenced by factors such as the recent Domestic Debt Exchange Programme (DDEP) and challenges within the banking sector over the past two years.

The resolution garnered unanimous support, with no opposition or abstention, empowering the bank to proceed with raising up to GH¢2 billion in additional equity capital.

Speaking at the EGM, the bank’s Board Chairman – Daasebre Akuamoah Agyapong II, indicated that per Section 28(1) of the Banks and Specialised Deposit-Taking Institutions Act, 2016 (Act 930), ADB is required to maintain the prescribed minimum paid-up capital (unimpaired by losses including accumulating losses or other adjustments).

“The current minimum paid-up capital prescribed by the Bank of Ghana for banks, including ADB, is GH¢400million,” he added.

Daasebre Akuamoah Agyapong II highlighted that recent unfavorable economic events, such as the Domestic Debt Exchange Programme (DDEP) and impairments in the bank’s loan book, have negatively affected the minimum paid-up capital of the bank.

This, the Board Chairman said, birthed the bank’s intention of raising additional capital to shore up its minimum paid-up capital.

Daasebre Akuamoah Agyapong II highlighted the crucial role this capital infusion will play in advancing the bank’s mandate of promoting socio-economic development through agriculture and more.

The shareholders of the bank overwhelmingly supported all resolutions presented at the EGM, demonstrating their keen willingness to recapitalize the bank.

In his remarks following the EGM, Alhaji Alhassan Yakubu-Tali, Managing Director of the bank, expressed gratitude for the resounding vote of confidence from shareholders, adding that the additional capital will significantly enhance the overall operations of ADB.

“The additional capital injection will provide solidity and more comfort to our customers, investors and the general public. For this gesture, I want to say a big ‘thank you’ to our shareholders for the significant milestone chalked up,” he said.

Alhaji Alhassan Yakubu-Tali added that the injection of additional capital will not only fortify the bank’s financial strength, but also position it strategically to extend continuous support to the agricultural sector and other critical areas of operation.

Listed on the Ghana Stock Exchange, Agricultural Development Bank PLC has a majority ownership by the government. Additionally, the bank boasts a significant portion of private, institutional, and retail shareholders.