HFC bank says it has revised its strategies to reduce the bank’s Non-Performing Loans (NPL) in 2016.
At the bank’s Annual General Meeting held last week, it emerged that its loan impairment expense went up by a whopping 474 percent to end 2015 at 81,848,000 cedis.
According to the Managing Director of HFC, Robert Le Hunte, majority of the defaulters were in corporate, retail and housing industries.
A critical review by new owners of HFC bank led to an increase in Non-Performing Loan (NPL) ratio from 10.43 in 2014 to 21.07 in 2015.
This also followed a decision by the new owners to increase the NPL portfolio from 72.9 million cedis in 2014 to 213 million cedis in 2015.
The move also led to an increase in impaired loans from 41.9 million cedis in 2014 to about 123.8 million 2015.
But Robert Le Hunte explains that the bank has re-trained its staff to track possible loan defaulters,
“We have spent a lot of time in training our staff in credit analysis; just to ensure that going forward we are making the necessary assessment of customers,” he stated.
Mr. Le Hunte added, “We have brought the team together, centralised it, almost tripled the number of staff looking at it. We have put a senior manager to be in charge of that so recoveries are now our strategic focus. With the new computer system that we have that gives much earlier detection, we are now focusing on it and we hope therefore to increase the recovery element.”
Meanwhile the bank believes however that despite these setbacks, its 2016 performance and beyond will be impressive.
The bank believes this will be made possible through its new strategic plan dubbed 3-in-3.
The three year strategy will focus on 5 core pillars including deposit mobilization, asset creation, improving recoveries, cost management and revitalizing the culture of the bank.
According to Robert Le Hunte the strategy is also expected to push the bank to achieve its objective of becoming a 1st tier bank in the next three years.
“The new direction of the bank is to leverage on the infrastructure and strong mortgage base to generate additional income and deepen its presence in retail, corporate and commercial and SME banking while building on the experience of RFHL.”
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