1 GCB BANK LIMITED ANNUAL REPORT 2017 2 VISION We aspire to be Ghana’s favorite Bank and one of the most recognised and preferred fi nancial service brands in Africa and beyond MISSION Our mission is to provide friendly, helpful and accessible banking services, combined with expert fi nancial solutions that help people and businesses realize their goals. GCB BANK LIMITED ANNUAL REPORT 2017 3 CONTENTS 4 Corporate Information 5 Notice of Annual General Meeting 7 Board of Directors 8 Profi les of the Board of Directors 12 Financial Highlights 13 Five Year Financial Summary 16 Chairman’s Statement 20 Managing Director’s Review 24 Report of the Directors 28 Corporate Governance 33 Independent Auditor’s Report 37 Statements of Comprehensive Income 39 Statements of Financial Position 40 Statements of Changes in Equity 43 Statements of Cash Flows 45 Notes to the Financial Statements 130 Appendix 1 - Value Added Statement 131 Appendix 2 - Shareholder Information 134 List of Branches 145 Invitation and Form of Proxy GCB BANK LIMITED ANNUAL REPORT 2017 CORPORATE INFORMATION 4 Corporate Information BOARD OF DIRECTORS Mr. Jude Kofi Arthur (Chairman) Mr Anselm Ransford Adzete Sowah (Managing) Mr. Socrates Afram Mr. Samuel Amankwah Appointed 25/10/17 Mrs. Lydia Gyamera Essah Mr. Nik Amarteifi o Appointed 07/06/17 Mr. Richard Oppong Appointed 07/06/17 Nana Ama Ayensua Saara III Appointed 07/06/17 Mr. Francis Arthur-Collins Appointed 25/10/17 Mr. Osmani Aludiba Ayuba Appointed 25/10/17 Mr. Ray Ankrah Appointed 25/10/17 Mr. Kofi Worlanyo Resigned 03/04/17 Mr. Ernest Kwasi Okoh Retired 26/05/17 Mr. Samuel Sarpong Resigned 31/05/17 Nana Otuo Acheampong Appointed 07/06/17, Resigned 31/08/17 SECRETARY Mrs. Helen Addo GCB Bank Building, Thorpe Road, High Street P. O. Box 134, Accra AUDITOR KPMG Chartered Accountants, 13 Yiyiwa Drive, Abelenkpe P. O. Box GP 242, Accra REGISTERED OFFICE GCB Bank Building, Thorpe Road, High Street P. O. Box 134, Accra REGISTRAR Share Registry GCB Bank Limited, Head Offi ce, High Street, Accra GCB BANK LIMITED ANNUAL REPORT 2017 NOTICE OF AGENDA 5 Notice of Annual General Meeting Notice is hereby given that the 24th Annual General Meeting of GCB Bank Limited will be held at the Accra International Conference Centre on Friday, 6th July 2018 at 10:00am to transact the following business: Agenda Ordinary Business 1. To consider and adopt the fi nancial statements of the Company for the year ended 31st December 2017 together with the Reports of the Directors and Auditor’s thereon. 2. To declare a Dividend for the year ended 31st December 2017. 3. To re-elect Directors retiring by rotation. 4. To elect Directors. 5. To approve Directors’ remuneration. 6. To appoint a new Auditor. 7. To authorize the Directors to determine the fees of the Auditor. Mrs. Helen Addo Special Business Company Secretary To consider and if thought fi t, to pass the following resolution which will be proposed as Special Resolution: 8. That an amount of GHS400 million (net of withholding tax) be transferred from the Company’s Income Surplus to Stated Capital in accordance with Section 66 (1) of the Companies Act, 1963 (Act 179). Dated this 13th day of March, 2018 BY ORDER OF THE BOARD Helen Addo (Mrs.) Company Secretary A member entitled to attend and vote at the meeting may appoint a proxy to vote in his/her stead. A form of proxy for it to be valid for the purposes of the meeting must be completed and deposited at the Share Registry, GCB Bank Ltd., Head Offi ce, High Street, Accra, not less than 48 hours before the meeting. GCB BANK LIMITED ANNUAL REPORT 2017 BOARD OF DIRECTORS 6 GCB BANK LIMITED ANNUAL REPORT 2017 7 Board of Directors Mr. Jude Kofi Arthur Mr Anselm Ransford Adzete Sowah Mr. Socrates Afram Chairman Managing Director DMD Finance Mr. Samuel Amankwah Mrs. Lydia Gyamera Essah Mr. Nik Amarteifi o DMD Operations (Appointed 25/10/2017) Non-Executive Director Non-Executive Director (Appointed 07/06/2017) Mr. Richard Oppong Nana Ama Ayensua Saara III Mr. Francis Arthur-Collins Non-Executive Director (Appointed 07/06/2017) Queen Mother Of Denkyira Non-Executive Director (Appointed 25/10/2017) Non-Executive Director (Appointed 07/06/2017) Mr. Osmani Aludiba Ayuba Mr. Ray Ankrah Non- Executive Director (Appointed 25/10/2017) Non-Executive Director (Appointed 25/10/2017) GCB BANK LIMITED ANNUAL REPORT 2017 PROFILE OF DIRECTORS 8 Profi les of the Board of Directors Outside Board and Director Qualifi cation management position Mr. Jude Kofi Arthur Fellow, The Chartered Ghana International Bank Chairman Institute of Bankers, Ghana; BSc. Administration, University of Ghana Mr. Anselm Ransford Adzete Barrister-at-Law and GCNet and Development Sowah Solicitor, Ghana Law School; Finance and Holdings Managing Qualifying Certifi cate in Limited. Law, University of Ghana, Legon; BA English & Philosophy, University of Ghana Mr. Socrates Afram Fellow, Association of Prairie Volta Limited, Chartered Certifi ed Oasis Capital Limited, Accountants; MBA Finance, Development Finance University of Ghana; and Holdings Limited and Bachelor of Commerce, NCR Corporation Ghana University of Cape Coast. Mr. Samuel Amankwah Fellow, Association of Development Finance Chartered Certifi ed and Holdings Limited Accountants; MSc. and VIVO Energy Ghana Accounting & Finance, Limited De-Montfort University. GCB BANK LIMITED ANNUAL REPORT 2017 PROFILE OF DIRECTORS 9 Profi les of the Board of Directors cont’d Outside Board and Director Qualifi cation management position Mrs. Lydia Gyamera Essah MPHIL Business None Administration, Ghana Institute of Management & Public Administration (GIMPA); BA English & Literature, University of Ghana, Legon. Mr. Nik Amarteifi o MBA, Harvard Business Dannex Limited, Omini School; BA Economics, Media (Citi FM), Starwin Wesleyan University Products Limited, Aryton Drugs Limited, Webster University, Ghana, African American Inst (NY) and Ghana Agro Food Company. Mr. Richard Oppong MA Economics, Simon Labadi Beach Hotel Fraser University; BA (Hons) Economics & Sociology, University of Ghana, Legon. Nana Ama Ayensua Saara III B. Com, University of Nasaa Company Limited Cape Coast; Diploma Business Studies, Takoradi Polytechnic GCB BANK LIMITED ANNUAL REPORT 2017 PROFILE OF DIRECTORS 10 Profi les of the Board of Directors cont’d Outside Board and Director Qualifi cation management position Mr. Francis Arthur-Collins MBA Information None Technology, Leicester University; Member, British Computer Society; Member, Institute of Management Information Systems; Fellow, Ghana Institute of Information Technology Diploma, University of Science & Technology. Mr. Osmani Aludiba Ayuba Member, Institute of Finag Company Chartered Accountants Ghana; Member, Chartered Institute of Procurement and Supply; M.A. Economic Policy Management, University of Ghana; Bachelor of Commerce, University of Cape Coast; Diploma in Education, University of Cape Coast. Mr. Ray Ankrah Fellow, Chartered National Insurance Institute of Management Commission Accountants (UK); Fellow British Society of Commerce; Member Institute of Chartered Accountants Ghana and Post Graduate Diploma Strategic Financial Management, Kingston University GCB BANK LIMITED ANNUAL REPORT 2017 11 GCB BANK LIMITED ANNUAL REPORT 2017 FINANCIAL HIGHLIGHTS 12 Financial Highlights The Group The Bank 2017 2016 2017 2016 At 31 December GH¢’000 GH¢’000 GH¢’000 GH¢’000 Total assets 9,627,061 6,074,533 9,558,151 6,049,604 Loans and advances to customers 2,090,330 1,412,977 2,090,330 1,412,977 Investment securities 4,884,277 2,633,116 4,878,155 2,626,946 Cash and cash equivalents 1,022,684 1,179,975 1,022,684 1,179,975 Total liabilities 8,412,902 5,014,706 8,445,001 5,034,492 Customer deposits 6,924,041 4,259,933 6,956,190 4,279,775 Borrowings 959,105 523,281 959,105 523,281 Shareholders’ equity 1,214,159 1,059,827 1,113,150 1,015,112 For the year ended 31 December Net interest income 895,311 885,807 894,400 884,488 Net fees and commission income 170,296 141,859 170,296 141,859 Impairment on loans and advances 49,904 27,160 49,904 26,531 Profi t before tax 331,983 466,994 308,894 446,782 Profi t after tax 234,598 318,116 212,715 299,007 Dividend per share (Ghana pesewas): 10 38 10 38 Earnings per share (Ghana pesewas): -Basic 89 120 80 113 -Diluted 89 120 80 113 Return on equity (%) 21 30 21 29 Return on assets (%) 3 5 3 5 At 31 December Number of staff * 1,915 1,532 1,915 1,532 Number of branches* 161 160 161 160 *Following the assumption of certain assets and liabilities of the erstwhile UT Bank and Capital Bank, GCB Bank Limited took over the management of the assumed Banks which resulted in 825 staff and 53 branches residing under the management of GCB Bank Limited. These are not included in the number of staff and branches disclosed above. GCB BANK LIMITED ANNUAL REPORT 2017 FIVE YEAR FINANCIAL SUMMARY 13 Five Year Financial Summary Statement of Comprehensive Income - Group 2017 2016 2015 2014 2013 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 Income Statement Interest income 1,187,853 1,019,655 839,115 690,708 552,063 Interest expense (292,542) (133,848) (107,571) (92,982) (92,104) Net interest income 895,311 885,807 731,544 597,726 459,959 Fee and commission income 207,787 174,585 132,374 114,392 88,566 Fee and commission expense (37,491) (32,726) (24,183) (22,422) (11,419) Net fee and commission income 170,296 141,859 108,191 91,970 77,147 Net trading income 41,020 27,349 16,561 37,758 26,842 Other revenue 17,386 16,039 6,995 3,739 3,297 Revenue 1,124,013 1,071,054 863,291 731,193 567,245 Loss on derecognition of renegotiated loans (1,543)