Shareholders of GCB Bank have resoundingly voted against a resolution to increase the remuneration of the board of directors by some 60percent from GH¢2.5million to GH¢4million.
New board chair, Jude Kofi Arthur, who put the proposal to shareholders at a recent Annual General Meeting (AGM), noted that since 2013, the bank has not increased the remuneration of its board of directors and thus, with consistently good performance over the past three years, deserve an increment.
In an unprecedented move, the shareholders were of the view that a 60percent increment was just too high.
Shareholders also argued that even though the board of the bank has performed consistently well, any increment should benefit former board members not newly-appointed ones.
“The proposed increment for the directors is too high and it is not fair to previous directors who worked hard for the bank to grow.
You have to continue with the current rate and then next year, we can consider an increment,” J.A Annan, a shareholder submitted at the AGM.
J.C. Kyei, another shareholder, added that: “some of us are of the opinion that even though we appreciate the work being done by the board of directors, the amount being asked is too high.
From GH¢2.5million to GH¢4million is exceedingly high.”
The board chairman, Jude Kofi Arthur, noted that the shareholders, in their wisdom, looked at the proposal and felt, by show of hands, that they will not approve it.
“That is what it is. when these things happen, we take the decision from the shareholders in good faith and bring another proposal to them,” he said.
Mr. Arthur added that it is difficult to give a timeline as to the next line of action but he assured that whatever decision is arrived “will be in the interest of the shareholders and the company.”
Financial performance of the bank
The bank’s total assets saw a 30percent growth to GH¢6.1billion in 2016 from GH¢4.7billion in 2015, which was largely funded with GH¢899million in deposits.
With these resources, the bank generated total operating income of GH¢1.1billion in 2016, compared to GH¢863million in 2015, thus recording a 24percent growth year on year.
The bank recorded a profit before tax of GH¢467million in 2016, an increment of 29percent from 2015 and a profit after tax of GH¢318million, an increment of 25percent from 2015.
In staying true to its ability to consistently pay dividend to shareholders, the bank proposed a dividend payment of GH¢100.7million for the 2016 financial year at GH¢0.38 per share, a 15percent growth over the rate of GH¢0.33 paid in 2015.
The bank’s strategic plan, which focused on modernity, market share growth and enhancing shareholder value comes to an end this year, and the bank noted that targets were largely met.