ADB reports losses of GH¢371 million in 2022, blames DDEP

The Agricultural Development Bank, ADB PLC has reported losses of GH¢371 million in 2022, blaming it on the government’s domestic debt exchange programme, DDEP. ADB’s loss of GH¢371 million is in stark contrast to its previous year’s performance where it reported GH¢81.6 million in profits. The bank has since 2017 reported gains but took a significant dip in 2022 which it largely blames on the government’s DDEP.

Also, the bank’s capital adequacy ratio, CAR has fallen to 7.3 per cent, below the Bank of Ghana requirement of 10 per cent.

Daasebre Akuamoah Agyapong II, the Board Chairman of the bank said the bank is working to restore its CAR to the minimum regulatory requirement. He said “The Board of Directors is working on a capital restoration plan that will return the CAR of the bank to the regulatory minimum as soon as possible.

“Engagements with stakeholders will commence once the proposal has been reviewed and approved by the Board of Directors,” he said at the Bank’s 36th annual general meeting on Wednesday, August 9, 2023.

Despite the bank reporting losses in 2022, its balance sheet grew by 14.9 per cent after seeing its size increase from GH¢6.5 billion in 2021 to GH¢7.4 billion. Also, the non-performing loans of the bank reduced from 31.21 per cent in 2021 to 29.74 per cent in 2022.

Alhassan Yakubu-Tali, the bank’s managing director said the bank experienced elevated credit losses as a result of the inability of some of the bank’s customers to repay their loans.

“In addition, like most other banks, we experienced elevated credit losses because some of our customers struggled to repay their loans. As credit quality deteriorated, we added to loan loss reserves. Our 2022 results reflect a net build of GH¢49 million to our loan loss reserves. We ended the year with total loan loss reserves of GH¢512 million.” 

ADB’s loss comes on the back of the Bank of Ghana also reporting losses of GH¢60.8 billion of which it said GH¢53.1 billion is attributable to the government’s domestic debt exchange programme.