Rural banks in Ashanti engaged to access foreign investments

Rural and community banks in the Ashanti region have an opportunity to attract foreign investments into their operations.

Dutch-based Goodwell Investments, in partnership with JCS Investments Limited has introduced a $50million Goodwell West Africa Microfinance Fund. The wholesale microfinance equity fund has a one-third allocation to Ghana.

The Nwabiagya Rural Bank in 2011 attracted a one million dollar equity share investment for a period of sixty months from the Fund.

A seminar in Kumasi highlighted the value of rural bank shares as an attractive asset class.

Managing Director of JCS Investments, Patricia Sarfo says promising rural banks can attract quality investments.

There are also opportunities for rural banks to attract capital from the Ghana Alternative Market (GAX), a scheme introduced by the Ghana Stock Exchange to ease listing of SMEs on the stock market.

Financial institutions are barred from holding shares in rural banks under the country’s banking regulation, whilst foreign investments in equity should not be more than 20 percent.

According to Raymond Amanfu, a Director at the Banking Supervision Department of the Bank of Ghana, foreign businesses, other than individuals, can invest in rural banks after satisfying existing regulations.

JCS Investments Limited has been working with Bank of Ghana to modify the laws to enable foreign institutional investors invest in the rural banking sector. 

Ms Sarfo Armah says the local investors should also be interested in tapping into opportunities of buying shares in rural banks.

Board Chairman of Nwabiagya Rural Bank, Nana Owusu Sarfo Anwona II has urged rural banks to upgrade their operations in order to attract foreign investors.

Story by Kofi Adu Domfeh