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Bond CEO rallies support for microfinance sector

By: Emmanuel Bruce
Mr George Ofosuhene
Mr George Ofosuhene

The Chief Executive Officer of Bond Savings and Loans, Mr George Ofosuhene, has called on all stakeholders in the financial sector to help boost confidence in the microfinance sector, which is at an all-time low.

Speaking at the Facts Behind The Figures session which was organised by the Ghana Stock Exchange, he said “there is a confidence issue in the industry and we all have to support in bringing up that confidence”.

“There should be a crusade to educate people that if they all go to any of the institutions to ask for their money, none of them would survive. There is the need for them to be patient and even if they have had issues with the institution, Bank of Ghana has assured them that no depositor will lose money,” he stated.

“Just make sure that whatever document that the company has given to you is authentic and can be used to prove that you put your money in the said institution,” he added.

With regard to institutions who have no issues, Mr Ofosuhene urged the public not to rush there to take their money just because they had heard there were problems elsewhere.

Mr Ofosuhene also revealed plans of the company to raise an additional GH¢300 million from the Ghana Fixed Income Market (GFIM).

This amount, which is in addition to the GH¢100 million which is currently being raised by Bond on the market, is aimed at providing stable funds for the company and to also help it invest more in technology.

“We want to have the ability to have stable funds which will give us the benefit of planning for a long period and make it easier for us to organise ourselves.

“Our business primarily is to give loans to companies that are looking for financial support, and to be able to do that, we need stable funds,” he stated.

He also pointed out that the technology space continued to be very active and businesses could not satisfy their customers without the use of it.

“So we want to enhance our capabilities in the technology space. Banking is no longer where you go but what you do. You should be able to do bank transactions on your smartphone so we intend to invest more in technology,” he noted.

Reduced interest

Mr Ofosuhene also indicated that the medium-term fund gave the company the benefit of reduced interest.
“If you have reduced interest, your cost of fund is lower and you are able to give loans at lower rates, and the process will help businesses and the economy,” he stated.

He said due to the solid performances of the company over the period, it had been able to ensure that all coupon payments were made on time and had satisfied all conditions related to the earlier bonds.

“We, therefore, have the inclination that fund managers will support this new move,” he said.

Started process
On when the company intends to go to the market, the CEO said it had started the process of due diligence and it was expecting that during the third quarter of this year, it would be ready.

“This goes through a process and we currently have accountants who are going through our books and doing thorough analysis, after which they will provide an opinion on our financial position,” he stated.

Medium-term note
Bond Savings and Loans in 2017 embarked on a venture to raise funds from the GFIM with three main objectives of expanding the loan book, enhancing liquidity management and investing in technology.

The company has so far issued GH¢70 million out of the GH¢100 million shelf amount.

Mr Ofosuhene pointed out that all coupon payments had been successfully honoured promptly on the due dates.

He said the company had put in place structures to ensure that prompt payment of interests were maintained.

He said the programme had been very beneficial to the company by offering it the capacity to plan in the medium term, unlike other funds that were short term in terms of the tenure.

“We have also been able to open six cash centres within commercial areas and these centres serve as an important point for deposit mobilisation and channels through which customers are served with various products and services,” he explained.

In line with its strategy, he said the company had put in place a sinking fund to ensure that it was able to retire those funds at maturity without any difficulties.

Way forward
Commenting on the way forward, the CEO said the company intended to expand its reach through various e-business initiatives and pursue quality asset growth through selective sector participation.

He said the company would also continue to expand the deposit base with particular focus on the introduction of more mass market products and also expand its non-funded income base.