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Moving Forward Legon Co-operative Credit Union declares dividend

Aside from the dividend payment, 25 percent will be paid into the statutory reserve while the remaining 35 percent goes into the operating reserve.

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The University of Ghana Co-operative Credit Union Limited has declared GH¢1,315,289 -- representing 40 percent of its net surplus for the financial year -- as dividend to its members.

The dividend declared for the year ending June 30, 2015 is to be paid under review and represents a 66 percent increase on the previous year‘s figure of GH¢792,191.

The Union recorded a net surplus of GH¢3,288,222 -- up from GH¢1,980,487 the previous year.

Aside from the dividend payment, 25 percent will be paid into the statutory reserve while the remaining 35 percent goes into the operating reserve.

According to Dr. Jonathan N. Anaglo, Management Board Chairman, the management is committed to rewarding members appropriately for their financial interest in the Union.

“The payment will result in GH¢0.30 earnings per every GH¢1.00 share held, which compares favourably to very high yielding investment instruments within the Ghanaian money market,” he stated.

The Union achieved a total income of GH¢9,012,734; an increase of GH¢2,785,312 (46.36 percent) over the same period last year.

He said amidst the generally unstable economy in Ghana during the year under review, the Union was able to achieve the increment.

He said challenges included high inflation, increase in 91-day and 182-day Treasury bill rates, as well as the perennial delays in government subvention to the university to pay for members’ deductions.

Mr Anaglo said the Union had however managed to keep its interest on loans at 27 percent per annum, in spite of the difficult environment.

Interest on member-payments amounted to GH¢4,270,195 compared to the GH¢3,106,789 in 2014, while total operating costs marginally increased from 14.55 percent in June 2014 to 14.88 percent in 2015.

He stated that management also undertook loan recovery efforts which led to significant reductions in its provision for loan losses from GH¢213,011, to GH¢162,965,963 in June 2015.

“This was achieved despite an increase in loans granted: GH¢22,746,012 and GH¢29,446,932 for 2014 and 2015 respectively,” he stated.

Mr. Francis Fiayiya, Manager of the Union, said it paid a total of 16 percent per annum on savings -- averaging four percent per quarter, as against 15 percent per annum in the previous year, and much more than the four percent per annum paid in the banking sector.

“The Union made significant strides in loan recovery, registering a zero percent appreciation in provision for loan losses.” While its loan portfolio grew to GH¢29,283,969 in the year under review, provision for loan losses decreased from GH¢213,011 to GH¢162,963.

Mr. Fiayiya noted that a major challenge the Union faced in the financial year under review was the incidence of some members attempting to secure loans from the Union with falsified documents.

He said although the Union has been lenient with them in the past, it will not countenance such acts in future.

“Any individual found culpable of such an offence will henceforth be made to face the full sanctions of the law,” he stated.

He disclosed that management of the Union are currently working to operate salary accounts for its members in partnership with the HFC Bank by January 2016.

This, he said, will help alleviate the challenges with migration of the University’s payroll system to the Controller and Accountant-General’s Department.

Mr. Fiayiya urged members and shareholders to continue patronising the Union’s services in order to move it forward.

- BFTOnline.com

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