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uniBank (Ghana) Limited
Report and financial statements 25
UNIBANK GHANA LIMITED 2016 ANNUAL REPORT
uniBank (Ghana) Limited
Corporate information
1
Content Page
Directors, Officials & Registered Office 2
Vision, Mission & Values 3
Directors‟s Report 4 - 6
Statement of Directors‟ Responsibilities 7
Independent Auditor‟s Report 8 - 10
Statement of Profit or Loss and other Comprehensive Income 11
Statement of Financial Position 12
Statement of Changes in Equity 13
Statement of Cash Flows 14
General Information and Summary of Significant Accounting Policies 15 - 68
uniBank (Ghana) Limited
Corporate information
2
Directors: Opoku-Gyamfi Boateng - Chairman
Felix Nyarko-Pong - Chief Executive Officer
Kwabena Duffuor II(Dr.) - Chief Operating Officer
Owusu-Ansah Awere - Executive Director
Ekow Nyarko Dadzie-Dennis - Executive Director
Alexander Gaddiel Buabeng - Non-Executive Director
Kofi Kyereh-Darkwah - Non-Executive Director
Nana Boakye Asafu-Adjaye - Non-Executive Director
Newman Kwadwo Kusi(Prof.) - Non-Executive Director
Ben Korley - Non-Executive Director (Resigned 20 January 2016)
Kakra Duffuor-Nyarko(Mrs.) - Non-Executive Director
Company Secretary Sylvia Assimeng-Archer(Mrs.)
Executive Management Felix Nyarko-Pong - Chief Executive Officer
Kwabena Duffuor II(Dr.) - Chief Operating Officer
Owusu-Ansah Awere - Executive Director - Operations and IT
Ekow Nyarko Dadzie-Dennis - Executive Director - Finance, Retail and Strategy
Kwesi Nkrumah Pimpah - Director - Risk Management and Compliance
Clifford Duke Mettle - Director - E-banking, Products and Marketing
Sylvia Assimeng-Archer(Mrs.) - Company Secretary
John Collins Arthur - Executive Head, Treasury and Global Trade
Elsie Dansoa Kyere(Mrs.) - Executive Head, Corporate Banking
Florence Adei Ohene(Mrs.) - Executive Head, Innovations and Business Execution
Solicitors: Prime Attorneys
11 Volta Street, Airport
Residential Area
PMB CT 179, Cantonments
Accra
Auditors: Deloitte & Touche
Chartered Accountants
4 Liberation Road
P.O.Box GP 453
Accra
Registered Office: World Trade Centre (WTC) No. 29, 13th Floor
Independence Avenue, Accra
P.O.Box AN 15367, Accra-North
Bankers: Bank of Ghana, One Thorpe Road, P.O.Box GP 2674, Accra, Ghana
Citi Bank, N.A. 111 Wall Street, 10043 New York
BHF Bank Bockenheimer LandStrasse 10. 60323 Frankfurt AM MAIN Germany
Ghana International Bank Plc, 67 Cheapside,1st Floor, Regina House, London EC2V 6AZ
Standard Chartered Bank, London. Clement House 27, Clements Lane, London EC4N 7P
uniBank (Ghana) Limited
Vision, Mission & Values
3
VISION, MISSION & VALUES
Vision
“To be the leading and preferred Bank offering comprehensive financial solutions to our chosen customers
(SME and Personal Banking Markets) in a professional, caring, responsive and profitable way”.
Mission
The Bank‟s mission is to:
Provide the best value for our customers;
Create an excellent working environment for our employee development and growth;
Enhance shareholder value;
Be socially responsive to our communities.
Core Values
Flexible
Minimum bureaucracy
Adaptive to changing needs
Caring
Customer delight
Personalized service
Vibrant
Energetic
Ingenious
Team
Will to win
Oneness of purpose
Strength
uniBank (Ghana) Limited
Directors’ report For the year ended 31st December 2016
4
Directors’ report
In accordance with the requirements of Section 132 of the Companies Code, 1963 (Act 179) as amended
and the Banking Act of 2016 (Act 930), we the Board of uniBank (Ghana) Limited submit our Annual Report
on the state of affairs of the Bank for the year ended 31st December 2016. The Directors in submitting to the
Shareholders, the financial statements of the Bank for the year ended 31st December 2016 report as follows:
1. Financial Results
2016
2015
GHS
GHS
Net profit before tax
59,688,694
51,326,509
Tax
(17,713,524)
(12,342,631)
-
Leaving net profit after tax of
41,975,170
38,983,878
To which is added Income Surplus at 1 January
36,571,136
20,053,023
Prior Year Tax Adjustment (under Provision)
-
(1,054,927)
Transfer to Statutory Reserve
(20,987,585)
(19,491,939)
Transfer to Regulatory Credit Reserve
(5,586,741)
(1,918,900)
Leaving Income Surplus at 31 December
51,971,980
36,571,135
2. Dividend No dividend was proposed during the year.
uniBank (Ghana) Limited
Directors’ report For the year ended 31st December 2016
5
3. Directors
The Directors who held office during the year were as follows:
Name Designation
Opoku-Gyamfi Boateng - Chairman
Felix Nyarko-Pong - Chief Executive Officer
Kwabena Duffuor II (Dr.) - Executive Director
Owusu-Ansah Awere - Executive Director
Ekow Nyarko Dadzie-Dennis - Executive Director
Alexander Gaddiel Buabeng - Non-Executive Director
Kofi Kyereh-Darkwah - Non-Executive Director
Nana Boakye Asafu-Adjaye - Non-Executive Director
Newman Kwadwo Kusi (Prof.) - Non-Executive Director
Ben Korley - Non- Executive Director (Resigned 20 January 2016)
Kakra Duffuor-Nyarko (Mrs.) - Non-Executive Director
4. Principal Activities
The principal activity of the Bank during the year was in accordance with its regulations and there was no
change in the principal activities during the year.
5. Auditors
The Bank‟s Auditors, Deloitte and Touche, having qualified under Section 134(5) of the Companies Code
1963 (Act 179) as amended have proposed to continue in office.
6. Other Matters
The Directors confirm that no matters have arisen since 31st December 2016 which, materially affect the
financial statements of the Bank for the year ended on that date.
7. Strategic Focus and Outlook for 2017
There is a drive across the industry towards digitalization of processes and the increasing use of various
electronic channels to serve customers. uniBank has made so much strides in this area, having invested
heavily in the systems and e-tools that would enable the Bank stay ahead of this drive and remain
competitive. In 2017, we shall be active in this space and drive more efficiency through our installed
applications and electronic systems.
Our major objective over the past few years has been to achieve a good balance between profitability and a
strong balance sheet. This objective will continue to drive our plans and strategies in 2017 and into the
uniBank (Ghana) Limited
Directors’ report For the year ended 31st December 2016
6
medium-term, fueled by high liquidity. Consequently, for 2017, we have adopted various plans and
developed the appropriate strategies aimed at ensuring that this is speedily achieved.
Given the rapid disruption spawned by fin-tech companies in the financial sector, we shall position the Bank
to reap the full benefits thereof. In line with this goal, the bank will pursue a deliberate digitalization strategy
that will significantly transform our operations in the areas of Retail, SME, Corporate, IT, Marketing, and E-
Banking. Self-Service (digital) branches will be deployed in East Legon, Legon Campus, Airport City, Capital
Place (Airport), KNUST campus, Golden Tulip, among others. Digitalization will provide convenience, speed,
and enhanced customer experience.
Through our aggressive deposit mobilization drive, anchored by initiatives which include widening of our
school fees and hospital charges collections mandates, internal and external deposit promotions, tapping
into float generated by Telcos from mobile money, among others, we expect to generate enough deposits to
invest in carefully selected assets to make the most gains without exposing the Bank to unnecessary
avoidable risks.
On loans and advances, we shall be selective in lending, with more preference for liquid, short-term facilities,
especially to SMEs. Corporate lending will be skewed towards commerce, export businesses and donor-
funded projects while scaling down lending to real estate companies and oil & gas businesses. Through
continuous monitoring, we shall ensure the loan book growth does not outstrip deposits growth at any point
in time.
Overall, we expect our balance sheet to be more liquid and structurally efficient. All new deposits will be
channeled into investments to improve our investment portfolio and income generation.
For and Behalf of the Board of Directors
Chairman Chief Executive Officer
Dated: 9th
March, 2017
uniBank (Ghana) Limited
Statement of Directors’ Responsibilities
7
The Directors‟ are responsible for preparing financial statements for each financial year which give a true
and fair view of the state of affairs of the Bank at the end of the financial year and the statement of profit or
loss and other comprehensive income of the Bank for that year. In preparing those financial statements, the
Directors‟ are required to:
Select suitable accounting policies and then apply them consistently;
Make judgements and estimates that are reasonable and prudent;
State whether the applicable accounting standards have been followed;
Prepare the financial statements on the going concern basis unless it is inappropriate to presume
that the Bank will continue in business.
The Directors‟ are responsible for ensuring that the Bank keeps accounting records which disclose with
reasonable accuracy the financial position of the Bank and which enables them to ensure that the financial
statements comply with Companies Code 1963 (Act 179) as amended and the Banking Act, 2004 (Act 673)
as amended by Banking (Amendment) Act 2007 (Act 738) and International Financial Reporting Standards.
They are responsible for safeguarding the assets of the Bank and hence for taking steps for the prevention
and detection of fraud and other irregularity.
8
Independent Auditor’s Report To The Members of uniBank (Ghana) Limited Report on the Audit of the Financial Statements Opinion
We have audited the accompanying financial statements of uniBank (Ghana) Limited which comprise the
statement of financial position as at 31 December 2016, the statement of profit or loss and other
comprehensive income, statement of changes in equity, statement of cash flows for the year then ended, the
notes to the financial statements including a summary of significant accounting policies and other national
disclosures.
In our opinion, the financial statements give a true and fair view of the financial position of uniBank (Ghana) Limited as at 31 December 2016 and the financial performance and cash flows for the year then ended in accordance with the International Financial Reporting Standards, and in the manner required by the Banking Act 2004 (Act 673), Section 78 (2), the Banking (Amendment) Act 2007 (Act 738) and the Companies Act, 1963 (Act 179). Basis of opinion We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Bank in accordance with the requirements of the International Federation of Accountants Code of Ethics for Professional Accountants (IFAC Code) as adopted by the Institute of Chartered Accountants Ghana (ICAG) and we have fulfilled our other ethical responsibilities in accordance with IFAC Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Other Information The directors are responsible for the other information. The other information comprises the Report of the Directors, which we obtained prior to the date of this auditor‟s report. The other information does not include the financial statements and our auditor‟s report thereon. Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and,
in doing so, consider whether the other information is materially inconsistent with the financial statements or
our knowledge obtained in the audit, or otherwise appears to be materially misstated.
Based on the work we have performed on the other information that we obtained prior to the date of this
auditor‟s report, if we conclude that there is a material misstatement of this other information, we are required
to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Statements The directors are responsible for the preparation of financial statements that give a true and fair view in accordance with International Financial Reporting Standards and the requirements of the Companies Act, 1963, (Act 179) and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
9
Independent Auditor’s Report (cont’d) To The Members of uniBank (Ghana) Limited Report on the Audit of the Financial Statements In preparing the financial statements, the directors are responsible for assessing the Bank‟s ability to continue
as a going concern, disclosing, as applicable, matters related to going concern and using the going concern
basis of accounting unless the directors either intend to liquidate the Bank or to cease operations, or have no
realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor‟s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional
scepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting
a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may
involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal
control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Bank‟s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
We communicate with the audit committee and the directors regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any significant deficiencies in internal
control that we identify during our audit.
Report on Other Legal and Regulatory Requirements The Companies Act, 1963 (Act 179) requires that in carrying out our audit work we consider and report on the following matters. We have obtained all the information and explanation which to the best of our knowledge and belief were necessary for the purpose of our audit. We confirm that: i) We have obtained all the information and explanation which to the best of our knowledge and believe
were necessary for the purpose of our audit.
ii) The Bank has kept proper books of account, so far as appears from our examination of those books.
iii) The Bank‟s financial position and its statement of profit or loss and other comprehensive income are
in agreement with the books of account and returns.
10
Independent Auditor’s Report (cont’d) To The Members of uniBank (Ghana) Limited Report on the Audit of the Financial Statements The Banking Act 2004 (Act 673) section 78 (2) and the Banking (Amendment) Act 2007 (Act 738) requires that we state certain matters in our report. We hereby state that:
I. the accounts give a true and fair view of the state of affairs of the Bank and their results for the year under review;
II. we were able to obtain all the information and explanations required for the efficient performance of
our duties as auditors;
III. the Bank transactions were within its powers; and
IV. the Bank has generally complied with the provisions in the Banking Act 2004 (Act 673) and the Banking (Amendment) Act 2007 (Act 738).
The engagement partner on the audit resulting in this independent auditor's report is Kwame Ampim-Darko (ICAG/P/1453).
For and on behalf of Deloitte & Touche (ICAG/F/2017/129)
Chartered Accountants
4 Liberation Road
Accra Ghana
28
th March, 2017
uniBank (Ghana) Limited
Statement of profit or loss and other comprehensive income For the year ended 31st December 2016
11
2016 2015
Note GHS GHS
Interest income 2 1,347,883,423
632,800,000
Interest expense 3 (1,044,754,294) (495,947,885)
Net interest income
303,129,129
136,852,115
Fee and commission income 4 40,284,666
44,242,498
Trading Income 5a 49,391,371
55,217,502
Other Income 5b
120,313
22,658,343
Operating income
392,925,479
258,970,458
Impairment Loss on Loans & Advances 8 (80,247,571) (20,682,177)
Personnel Expenses 7 (63,037,357) (46,200,328)
Depreciation and Amortization 14a (16,238,648) (10,371,964)
Other Expenses 6 (173,713,209) (130,389,480)
Profit before taxation
59,688,694
51,326,509
National fiscal stabilization levy 9c (2,984,435) (2,566,326)
Income tax expense 9d (14,729,090) (9,776,305)
Profit for the year
41,975,170
38,983,878
Other comprehensive income
- -
Total comprehensive income for the year
41,975,170
38,983,878
The notes on pages 15 to 68 are an integral part of these financial statements.
uniBank (Ghana) Limited
Statement of financial position As at 31st December 2016
12
2016 2015
Note GHS GHS
ASSETS
Cash and cash equivalents 10 1,503,415,970 661,408,248 Non-Pledged Trading assets 11 438,078,747 343,878,221
Pledged Trading assets 11 511,600,274 42,945,935
Loans and advances to customers 12 2,885,538,777 2,475,190,684
Other assets 13 229,313,512 151,497,508
Property, plant and equipment 14a&b 175,243,260 156,011,870
Total assets
5,743,190,540 3,830,932,466
Liabilities
Deposits from customers 15 2,615,879,033 2,728,142,189
Borrowings 16 2,394,179,397 660,519,775
Other liabilities 17 246,484,824 136,532,246
Current tax liability 9a 1,170,356 54,392
Deferred tax liability 9b 7,389,328 4,735,154
National fiscal stabilization levy 9c 331,047 167,325
Total Liabilities
5,265,433,985 3,530,151,081
Stated capital 18 295,129,890 160,129,890
Revaluation Reserve 19a 22,620,092 22,620,091
Statutory reserve funds 19b 88,594,627 67,607,042
Regulatory credit risk reserve 20 19,439,968 13,853,226
Income surplus 21 51,971,979 36,571,136
Total equity
477,756,555 300,781,385
Total equity and liabilities 5,743,190,540 3,830,932,466
DIRECTOR DIRECTOR The notes on pages 15 to 68 are an integral part of these financial statements.
UniBank (Ghana) Limited
Statement of changes in equity For the year ended 31st December 2016
13
Regulatory
Share Revaluation Statutory Credit Risk Income
Capital Reserve Reserves Reserve Surplus Total
GHS GHS GHS GHS GHS GHS
Balance at 1st January 2016
160,129,890
22,620,091
67,607,042
13,853,226
36,571,136
300,781,385
Issue of shares 135,000,000 - - - - 135,000,000 Prior year tax adjustment (under provision) - - - - - - Total comprehensive income - - - - 41,975,170 41,975,170 Transfer to/(from) - - - 5,586,741 (5,586,741) - Transfer to/(from) - - 20,987,585 - (20,987,585) -
Balance at 31st December 2016 295,129,890 22,620,091 88,594,627 19,439,967 51,971,980 477,756,555
Balance at 1st January 2015 120,129,890 22,620,091 48,115,103 11,934,326 20,053,023 222,852,433 Issue of Shares 40,000,000 - - - - 40,000,000 Prior year tax adjustment (under provision) - - - - (1,054,927) (1,054,927) Total comprehensive income - - - - 38,983,878 38,983,878 Transfer to/(from) - - 19,491,939 - (19,491,939) - Transfer to/(from) - - - 1,918,900 (1,918,900) -
Balance at 31st December 2015 160,129,890 22,620,091 67,607,042 13,853,226 36,571,135 300,781,384 The notes on pages 15 to 68 are an integral part of these financial statements.
uniBank (Ghana) Limited
Statement of cash flows For the year ended 31st December 2016
14
2016 2015
Notes
GHS GHS Cash flows from operating activities
Net profit before tax
59,688,694 51,326,509
Adjustments for:
Depreciation
15a
16,238,648 10,371,964 Impairment on financial asset
8
80,247,571 20,682,177
Operating profit before working capital changes
156,174,913 82,380,650 Change in trading assets
11
2,424,777 (49,990,015)
Change in loans & advances
(490,595,666) (1,187,322,995) Change in other asset accounts
(77,816,004) (104,382,921)
Change in deposits from customers
(112,263,156) 1,077,346,317 Change in borrowings
203,628,322 123,434,360
Change in interest payable & other liabilities
109,952,578 59,990,345 Cash generated from operations
(208,494,236) 1,455,741
National fiscal stabilization levy
9c
(2,820,713) (2,854,836)
Corporate tax paid
9a
(10,958,951)
(8,816,389)
Net cash used in operating activities
(222,273,900)
(10,215,484)
Cash inflows from investing activities
Profit on disposal of property, plant and equipment 15b
(495) - Purchase of property plant & equipment
(35,671,536) (36,970,362)
Proceeds from sale of property & equipment
201,993 32,080,676
Net cash from investing activities
(35,470,038)
(4,889,686)
Cash inflows from financing activities
Proceeds from issuance of shares
135,000,000 40,000,000 Net Cash from financing activities
135,000,000 40,000,000
Net Increase/(Decrease) in cash and cash equivalent
(122,743,938)
24,894,830 Cash and cash equivalents at 1st January
440,652,145 415,757,315
Cash and cash equivalents at end of year 22
317,908,207 440,652,145
Interest paid
1,222,125,900 458,704,773
Interest received
933,174,535 539,103,272
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
15
1. Reporting entity uniBank (Ghana) Limited, a private company limited by shares, was incorporated and domiciled in Ghana under the Companies Code, 1963 (Act 179) and the Banking Act, 2016 (Act 930). The Bank is permitted by its Regulations to carry on, the business of banking. The address of the registered office of the Bank is World Trade Centre (WTC), No. 29, 13
th Floor, Independence Avenue, Accra. P O Box AN 15367, Accra-North.
The financial statements of the Bank for the year ended 31st December 2016 were approved by the Board of
Directors on 9th March, 2017.
2. Basis of preparation
a. Statement of compliance
The financial statements have been prepared in accordance with the International Financial Reporting
Standards, as issued by the International Accounting Standards Board (IASB) and the Companies Code 1963
(Act 179).
b. Basis of preparation
The financial statements have been prepared on a historical cost basis except for financial instrument
measured at fair value and property, plant and equipment that are stated at their fair value. The financial
statements are presented in cedis and all values are rounded to the nearest thousands, except when
otherwise indicated.
c. Functional and presentation currency
The financial statements are presented in Ghana Cedis (GH₵), which is the functional currency
d. Use of estimates and judgment
The preparation of financial statements in conformity with IFRSs requires management to make judgement,
estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities,
income and expenses. The estimates and the associated assumptions are based on historical experience and
other factors that are reasonable under the circumstances, the results of which form the basis of making the
judgement about the carrying amounts of assets and liabilities that are not readily apparent from other
sources. Actual results may differ from these estimates.
The estimates and the underlying assumptions are reviewed on an ongoing basis. Revision to accounting
estimates are recognized in the period in which the estimate is revised if the revision affects only that period,
or in the period of the revision and future periods if the revision affects both current and future periods.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
16
3. Significant accounting policies The accounting policies set out below have been applied consistently to all periods presented in this financial statement.
a. Going concern
The Bank‟s management has made an assessment of its ability to continue as a going concern and is
satisfied that it has the resources to continue in business for the foreseeable future. Furthermore,
management is not aware of any material uncertainties that may cast significant doubt upon the Bank‟s ability
to continue as a going concern. Therefore, the financial statements continue to be prepared on the going
concern basis.
b. Fair value of financial instrument
Where the fair values of financial assets and financial liabilities recorded on the statement of
financial position cannot be derived from active markets, they are determined using a variety of
valuation techniques that include the use of mathematical models. The inputs to these models are derived
from observable market data where possible, but if this is not available, judgement is required to establish
fair values.
c. Impairment losses on loans and advances
The Bank reviews individually, significant loans and advances at each statement-of-financial-position date to
assess whether an impairment loss should be recorded in the income statement. In particular, management‟s
judgement is required in the estimation of the amount and timing of future cash flows when determining the
impairment loss. These estimates are based on assumptions about a number of factors and actual results
may differ, resulting in future changes to the allowance. Loans and advances that have been assessed
individually (and found not to be impaired) are assessed together with all individually insignificant loans and
advances in groups of assets with similar risk characteristics. This is to determine whether provision should
be made due to incurred loss events for which there is objective evidence, but the effects of which are not yet
evident. The impairment loss on loans and advances is disclosed in more detail in Note 13.
d. Deferred tax assets
Deferred tax assets are recognized in respect of tax losses to the extent that it is probable that future taxable
profit will be available against which the losses can be utilized. Judgement is required to determine the
amount of deferred tax assets that can be recognized, based upon the likely timing and level of future taxable
profits, together with future tax-planning strategies.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
17
The significant accounting policies adopted by uniBank (Ghana) Limited under the International Financial
Reporting Standards (IFRSs) are set out below:
e. Interest income and expense
For all financial instruments measured at amortized cost, interest income or expense is recorded using the
Effective interest rate (EIR). EIR is the rate that exactly discounts estimated future cash payments or receipts
through the expected life of the financial instrument or a shorter period, where appropriate, to the net carrying
amount of the financial asset or financial liability. The calculation takes into account all contractual terms of
the financial instrument (for example, prepayment options) and includes any fees or incremental costs that are
directly attributable to the instrument and are an integral part of the EIR, but not future credit losses.
The carrying amount of the financial asset or financial liability is adjusted if the Bank revises its estimates of
payments or receipts. The adjusted carrying amount is calculated based on the original EIR and the change in
carrying amount is recorded as ‟Interest and similar income‟ for financial assets and Interest and similar
expense for financial liabilities.
f. Commissions and fees
The Bank earns fee and commission income from a diverse range of services it provides to its customers. Fee
income can be divided into the following two categories:
(i) Fee income earned from services that are provided over a certain period of time
Fees earned for the provision of services over a period of time are accrued over that period. These fees
include commission income and asset management, custody and other management and advisory fees.
Loan commitment fees for loans that are likely to be drawn down and other credit related fees are deferred
(together with any incremental costs) and recognized as an adjustment to the EIR on the loan. When it is
unlikely that a loan will be drawn down, the loan commitment fees are recognized over the commitment period
on a straight-line basis.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
18
(ii) Fee income from providing transaction services Fees arising from negotiating or participating in the negotiation of a transaction for a third party, such as the
arrangement of the acquisition of shares or other securities or the purchase or sale of businesses, are
recognized on completion of the underlying transaction. Fees or components of fees that are linked to a
certain performance are recognized after fulfilling the corresponding criteria.
g. Other operating income
Other operating income comprises gains or losses arising on fair value changes in trading assets and
liabilities, profit or loss on disposal of property, plant and equipment and foreign exchange differences.
h. Financial assets and financial liabilities
Date of recognition
All financial assets and liabilities are initially recognized on the trade date, i.e., the date that the Bank
becomes a party to the contractual provisions of the instrument. This includes regular way trades: purchase or
sale of financial assets that require delivery of assets within the time frame generally established by regulation
or convention in the market place.
Categorization of financial assets and liabilities
The Bank classifies its financial assets in the following categories: financial assets held at fair value through
profit or loss; loans and receivables and available-for-sale financial assets. Financial liabilities are classified
as either held at fair value through profit or loss, or at amortized cost. Management determines the
categorization of its financial assets and liabilities at initial recognition.
h (i) Financial assets and liabilities held at fair value through profit or loss
This category has two sub-categories: financial assets and liabilities held for trading, and those designated at
fair value through profit or loss at inception. A financial asset or liability is classified as trading if acquired
principally for the purpose of selling in the short term.
Financial assets and liabilities may be designated at fair value through profit or loss when the designation
eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise
from measuring assets or liabilities on a different basis, or a group of financial assets and/or liabilities is
managed and its performance evaluated on a fair value basis.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
19
h (ii) Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not
quoted in an active market. They are measured at amortized cost using the effective interest rate
h (iii) Available-for-sale financial assets
Available-for-sale assets are those non-derivative financial assets that are designated as available-for-sale or
are not classified as financial assets at fair value through profit or loss, loans and receivable and held to
maturity. They are measured at fair value with changes of the fair value going through equity
h (iv) Financial liabilities measured at amortized cost
This relates to all other liabilities that are not designated at fair value through profit or loss.
Initial recognition
Purchase and sale of financial assets and liabilities held at fair value through profit or loss, available-for-sale
financial assets and liabilities are recognized on trade date (the date the Bank commits to purchase or sell the
asset).
Financial assets and liabilities are initially recognized at fair value plus directly attributable transaction cost
except for those that are classified as fair value through profit or loss.
Subsequent measurement
Available-for-sale financial assets are subsequently measured at fair value with the resulting changes
recognized in equity. The fair value changes on available for sale financial assets are recycled to the income
statement when the underlying asset is sold, matured or derecognized. Financial assets and liabilities
classified as fair value through profit or loss are subsequently measured at fair value with the resulting
changes recognized in income.
Loans and receivables and other liabilities are subsequently carried at amortized cost using the effective
interest method, less impairment loss.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
20
Derecognition
Financial assets are derecognized when the right to receive cash flows from the financial assets has expired
or where the Bank has transferred substantially all the risks and rewards of ownership. Any interest in the
transferred financial assets that is created or retained by the Bank is recognized as a separate asset or
liability.
Financial liabilities are derecognized when the contractual obligations are discharged, cancelled or expire.
Fair value measurement
The Bank measures fair values using the following fair value hierarchy that reflects the significance of the
inputs used in making the measurements:
Level 1: Quoted market price (unadjusted) in an active market for an identical instrument.
Level 2: Valuation techniques based on observable inputs, either directly (i.e., as prices) or indirectly
(i.e., derived from prices). This category includes instruments valued using quoted market prices in active
markets for similar instruments; quoted prices for identical or similar instruments in markets that are
considered less than active; or other valuation techniques where all significant inputs are directly or indirectly
observable from market data.
Level 3: Valuation techniques using significant unobservable inputs. This category includes all
instruments where the valuation technique includes inputs not based on observable data and the
unobservable inputs have a significant effect on the instrument's valuation. This category includes
instruments that are valued based on quoted prices for similar instruments where significant unobservable
adjustments or assumptions are required to reflect differences between the instruments.
The determination of fair values of quoted financial assets and financial liabilities in active markets are based
on quoted market prices or dealer price quotations. If the market for a financial asset or financial liability is not
actively traded, the Bank establishes fair value by using valuation techniques. These techniques include the
use of arms‟ length transactions, discounted cash flow analysis valuation models and techniques commonly
used by market participants.
For complex instruments such as swaps, the Bank uses proprietary models, which are usually developed from
recognized valuation models. Some or all of the inputs in these models may be derived from market prices or
rates or estimates based on assumptions.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
21
The value produced by a model or other valuation technique may be adjusted to allow for a number of factors
as appropriate, because, valuation techniques cannot appropriately reflect all factors market participants take
into account when entering into a transaction. Management believes that these valuation adjustments are
necessary and appropriate to fairly state financial instruments carried at fair value on the balance sheet.
Reclassification of financial assets
For a financial asset reclassified out of the available-for-sale category, any previous gain or loss on that asset
that has been recognized in equity is amortized to profit or loss over the remaining life of the investment using
the EIR. Any difference between the new amortized cost and the expected cash flows is also amortized over
the remaining life of the asset using the EIR. If the asset is subsequently determined to be impaired, then the
amount recorded in equity is recycled to the profit or loss.
Reclassification is at the election of management, and it is determined on an instrument by instrument basis.
Offsetting
Financial assets and liabilities are set off and the net amount presented in the balance sheet when, and only
when, the Bank has a legal right to set off the amounts and intends either to settle on a net basis or to realise
the asset and settle the liability simultaneously.
Income and expenses are presented on a net basis only when permitted by the accounting standards, or for
gains and losses arising from a group of similar transactions such as in the Bank‟s trading activity.
Amortized cost measurement
The amortized cost of a financial asset or liability is the amount at which the financial asset or liability is
measured at initial recognition, minus principal repayments, plus or minus the cumulative amortization using
the effective interest method of any difference between the initial amount recognized and the maturity amount,
minus any reduction for impairment.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
22
Identification and measurement of impairment
The Bank assesses at each balance sheet date whether there is objective evidence that a financial asset or
group of financial assets are impaired. A financial asset or a group of financial assets is impaired and
impairment losses are incurred if, and only if, there is objective evidence of impairment as a result of one or
more events that occurred after initial recognition of the asset (a “loss event”), and that loss event (or events)
has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be
reliably estimated.
Objective evidence that financial assets are impaired can include default or delinquency by a borrower,
restructuring of a loan and other observable data that suggests adverse changes in the payment status of the
borrower.
The Bank first assesses whether objective evidence of impairment exists individually for financial assets that
are individually significant, and individually or collectively for financial assets that are not individually
significant. If the Bank determines that no objective evidence of impairment exists for an individually
assessed financial asset, whether significant or not, it includes the asset in a group of financial assets with
similar credit risk characteristics and collectively assesses them for impairment. Assets that are individually
assessed for impairment and for which an impairment loss is or continues to be recognized, are not included
in a collective assessment of impairment.
If there is objective evidence that an impairment loss on a loan and receivable has been incurred, the amount
of the loss is measured as the difference between the asset‟s carrying amount and the present value of
estimated future cash flows (excluding future credit losses that have not been incurred), discounted at the
asset‟s original effective interest rate. The carrying amount of the asset is reduced through the use of an
allowance account and the amount of the loss is recognized in the income statement. If a loan and receivable
has a variable interest rate, the discount rate for measuring any impairment loss is the current effective
interest rate determined under the contract.
The calculation of the present value of the estimated future cash flows of a collateralized financial asset
reflects the cash flows that may result from foreclosure, less cost for obtaining and selling the collateral,
whether or not foreclosure is probable. For the purposes of a collective evaluation of impairment, financial
assets are grouped on the basis of similar credit risk characteristics (i.e. on the basis of the Bank‟s grading
process which considers asset type, industry, geographical location, collateral type, past due status and other
relevant factors).
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
23
These characteristics are relevant to the estimation of future cash flows for group of such assets being
indicative of the debtors‟ ability to pay all amounts due according to the contractual terms of the assets being
evaluated.
Future cash flows in a group of financial assets that are collectively evaluated for impairment are estimated on
the basis of historical loss experience for assets with credit risk characteristics similar to those in the Bank.
Historical loss experience is adjusted on the basis of current observable data to reflect the effects of current
conditions that did not affect the period on which the historical loss experience is based, and to remove the
effects of conditions in the historical period that do not exist currently.
If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related
objectively to an event occurring after the impairment was recognized (such as an improvement in the
debtor‟s credit rating), the previously recognized impairment loss is reversed by adjusting the allowance
account. The amount of the reversal is recognized in the statement of profit or loss and other comprehensive
income.
Impairment losses on available-for-sale financial assets are recognized by transferring the difference between
the amortized acquisition cost and current fair value out of equity to the statement of profit or loss. When a
subsequent event causes the impairment loss on an available for sale financial asset to decrease, the
impairment loss is reversed through the income statement. However, any subsequent recovery in the fair
value of an impaired available-for-sale financial asset is recognized directly in equity.
i. Property, Plant and Equipment
Recognition and measurement
Items of property and equipment are measured at cost less accumulated depreciation and impairment losses.
Cost includes expenditures that are directly attributable to the acquisition of the asset. The cost of self-
constructed assets includes the cost of materials and direct labour, and any other costs directly attributable to
bringing the asset to a working condition for its intended use. Purchased software that is integral to the
functionality of the related equipment is capitalized as part of that equipment.
When parts of an item of property and equipment have different useful lives, they are accounted for as
separate items (major components).
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
24
An impairment loss is recognized whenever the carrying amount of an asset exceeds its recoverable amount.
The recoverable amount of assets is the greater of their net selling price and value in use. The impairment
losses are recognized in the statement of profit or loss and other comprehensive income.
Subsequent costs
The cost of replacing part of an item of property or equipment is recognized in the carrying amount of the item
if it is probable that future economic benefits embodied within the part will flow to the Bank and its cost can be
measured reliably. The costs of the day-to-day servicing of property and equipment are recognized in the
statement of profit or loss and other comprehensive income as incurred.
Depreciation is computed using the straight-line method, at the following annual rates:
Computer Software 10%
Computer Hardware 33.3%
Equipment 20%
Furniture and Fittings 15%
Motor Vehicles 25%
Land and Buildings 2%
Leasehold Property Over the remaining lease term
Repairs and maintenance are charged to the income statement when the expenditure is incurred.
Improvements to Property, Plant and Equipment are capitalized.
Gains and losses on disposal of Property, Plant and Equipment are determined by reference to their carrying
amount and are taken into account in determining net income.
j. Translation of foreign currencies
The Bank‟s functional currency is the Ghana Cedi. Transactions in currencies other than Ghana cedis are
translated at the interbank foreign exchange rates as quoted by the Association of Bankers – Ghana.
Exchange differences arising on the settlement of monetary items, and on the retranslation of monetary items,
are included in the statement of profit or loss and other comprehensive income. Exchange differences arising
on the retranslation of non-monetary items carried at fair value are included in the statement of profit or loss
and other comprehensive income for the period except for differences arising on the retranslation of
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
25
non-monetary items in respect of which gains and losses are recognized directly in shareholders‟ equity. For
such non-monetary items, any exchange component of that gain or loss is also recognized directly in the
shareholders‟ equity.
k. Reference rate
The transaction rates used are the average of the buying and selling or the underlying interbank foreign
exchange rates as quoted by Association of Bankers, Ghana.
l. Cash and cash equivalents
For the purposes of cash flow statement cash and cash equivalents include cash, non-restricted balances
with Bank of Ghana, amounts due from other banks and financial institutions and short term government
securities maturing in three months or less from the date of acquisition.
m. Leases
Leases are tested to determine whether the lease is finance or operating lease and treated accordingly.
Finance leases - leases of property, plant and equipment where the Bank has substantially all the risks and
rewards of ownership are classified as finance leases. Finance leases are capitalized at inception of the lease
at the lower of the fair value of the lease property, plant and equipment and the present value of minimum
lease payments. Each lease payment is allocated between the liability and finance charges so as to achieve a
constant periodic rate of interest on the remaining balance of the liability for each period. The corresponding
rental obligations, net of finance charges, are included on other long term borrowings. The interest element of
the finance cost is charged to the income statement over the lease period. The property, plant and equipment
acquired under finance leases is depreciated over the shorter of the useful life of the asset or the lease term.
Operating leases – leases where a significant portion of the risks and rewards of ownership are retained by
the lessor are classified as operating lease. Rentals payable under operating leases are charged to income
statement on a straight- line basis over the term of the relevant lease. Benefits received and receivable as an
incentive to enter into operating lease are also spread on a straight-line basis over the lease term.
n. Provision
Provisions for restructuring costs, legal claims and similar events are recognized when: the Bank has a
present legal or constructive obligation as a result of past events; it is more likely that an outflow of resources
will be required to settle the obligation; and the amount has been reliably estimated.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
26
o. Deferred taxation
Deferred income tax is provided in full, using the liability method, on temporary differences arising between
the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred income
tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the statement
of financial position date and are expected to apply when the related deferred income tax asset is realized or
the deferred income tax liability is settled.
A deferred tax asset is recognized only to the extent that it is probable that future taxable profits will be
available against which the asset can be utilized. Deferred tax assets are reviewed at each reporting date and
are reduced to the extent that it is no longer probable that the related tax benefit will be realized.
p. Current taxation
The Bank provides for corporate taxes at the current tax rates on the taxable profits of the Bank.
Current tax is the expected tax payable on the taxable income for the year, using tax rates (and laws)
that have been enacted or substantially enacted by the statement of financial position date, and any
adjustment to tax payable in respect of previous years.
q. Dividends on ordinary shares
Dividends on ordinary shares are recognized on equity in the period in which they are approved by the Bank‟s
shareholders. Dividends for the year that are declared after the statement of financial position date are dealt
with in the subsequent events notes. Interim dividends are recognized when paid.
r. Impairment of non-financial assets
The carrying amount of the Bank‟s non-financial assets, other than deferred tax assets, are reviewed at each
reporting date to determine whether there is any indication of impairment. If any such indication exists then
the assets recoverable amount is estimated.
An impairment loss is recognized if the carrying amount of an asset exceeds its recoverable amount. The
recoverable amount of an asset is the greater of its value in use and its fair value less costs to sell.
Impairment losses are recognized in the Profit or Loss and other Comprehensive income.
Impairment losses recognized in prior periods are assessed at each reporting date for any indication that the
loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the
estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that
the assets carrying amount does not exceed the carrying amount that would have been determined, net of
depreciation or amortization, if no impairment loss had been recognized.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
27
s. Employee Benefits
Short-term benefits
Short-term employee benefits are amounts payable to employees that fall due wholly within twelve months
after the end of the period in which the employee renders the related service.
The cost of short-term employee benefits are recognized as an expense in the period when the economic
benefit is given, as an employment cost. Unpaid short-term employee benefits as at the end of the accounting
period are recognized as an accrued expense and any short-term benefit paid in advance are recognized as
prepayment to the extent that it will lead to a future cash refund and reduction in future cash payment.
Wages and salaries payable to employees are recognized as an expense in the income statement at gross
amount. The Bank‟s contribution to social security fund is also charged as an expense.
Pension scheme
The Bank in compliance to the National Pension Act, 2008 has in place a contributory three tier pension
scheme:
Tier One – a mandatory National Social Security Scheme, managed by the Social Security and
National Insurance Trust, under which a 13.5% contribution of employees‟ total emoluments, is made
by the bank.
Tier Two – a fully funded privately managed occupational pension scheme under which employees
contribute 5% of their total emoluments
Tier Three - The Bank has a Provident Fund Scheme for all permanent employees. Employees
contribute 5% of their basic salary to the Fund whilst the Bank contributes 5%. The Bank‟s obligation
under the plan is limited to the relevant contribution which is invested at interest rates agreed by the
trustees of the scheme and the Bank.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
28
Defined benefit gratuity scheme The Company has a defined benefit gratuity scheme for its employees. The company‟s net obligation in
respect of defined benefit scheme is calculated by estimating the amount of future benefit that employees
have earned in return for their service in the current and prior periods and that benefit is discounted to
determine its present value. In determining the liability for employee benefits under the defined benefit
scheme, consideration is given to future increases in salary rates and the company's experience with staff
turnover.
The recognized liability is determined by an independent actuarial valuation every year using the unit credit
method. Actuarial gains and losses arising from differences between the actual and expected out come in the
valuation of the obligation are recognized fully in Other Comprehensive Income. The effect of any curtailment
is recognized in full in the statement of Comprehensive income immediately the curtailment occurs. The
discount rate is the yield on Government of Ghana issued bonds that have maturity dates approximating the
terms of the company‟s obligation. Although the scheme is not funded, the company ensures that adequate
arrangements are in place to meet its obligations under the scheme.
Other long-term employee benefits
The company‟s other long-term employee benefits represents Long Service Awards scheme instituted for all
its employees. The company‟s obligations in respect of these schemes are the amount of future benefits that
employees have earned in return for their service in the current and prior periods. The benefit is discounted to
determine its present value. The discount rate is the yield at the reporting date on Government of Ghana
issued bonds that have maturity dates approximating the term of the company‟s obligation. The calculation is
performed using the Projected Unit Credit method.
t. Events after the Reporting date
The Bank adjusts the amounts recognized in its financial statements to reflect events that provide evidence of
conditions that existed at the statement of financial position date.
Where there are material events that are indicative of conditions that arose after the statement of financial
position date, the Bank discloses, by way of note, the nature of the event and the estimate of its financial
effect, or a statement that such an estimate cannot be made.
u. Financial Guarantees
Financial guarantees are contracts that require the Bank to make specified payments to reimburse the holder
for a loss it incurs because a specified debtor fails to make payment when due in accordance with the terms
of a debt instrument.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
29
Financial guarantees are initially recognized at their fair value, and the fair value is amortized over the life of
the financial guarantee. The financial guarantees are subsequently carried at the higher of the amortized
amount and the present value of any expected payment (when a payment under the guarantee has become
probable).
v. Application of new and revised International Financial Reporting Standards (IFRSs)
At the date of authorization of these financial statements the following standards, amendments to existing
standards and interpretations were in issue, but not yet effective. The application of these standards and
interpretation did not have any material impact on financial statement.
IFRS 9 “Financial Instruments” (effective for annual periods beginning on or after 1st January 2018).
Classification and Measurement - IFRS 9 introduces new approach for the classification of financial assets,
which is driven by cash flow characteristics and the business model in which an asset is held. This single,
principle-based approach replaces existing rule-based requirements under IAS 39. The new model also
results in a single impairment model being applied to all financial instruments.
Impairment - IFRS 9 has introduced a new, expected-loss impairment model that will require more timely
recognition of expected credit losses. Specifically, the new Standard requires entities to account for expected
credit losses from when financial instruments are first recognized and to recognize full lifetime expected
losses on a more timely basis.
Hedge accounting - IFRS 9 introduces a substantially-reformed model for hedge accounting, with enhanced
disclosures about risk management activity. The new model represents a significant overhaul of hedge
accounting that aligns the accounting treatment with risk management activities.
Own credit - IFRS 9 removes the volatility in profit or loss that was caused by changes in the credit risk of
liabilities elected to be measured at fair value. This change in accounting means that gains caused by the
deterioration of an entity‟s own credit risk on such liabilities are no longer recognized in profit or loss.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
30
IFRS 14 “Regulatory Deferral Accounts” (effective for annual periods beginning on or after 1st January 2016).
IFRS 14 “Regulatory Deferral Accounts” issued by IASB on 30 January 2015. This Standard is intended to
allow entities that are first-time adopters of IFRS, and that currently recognize regulatory deferral accounts in
accordance with their previous GAAP, to continue to do so upon transition to IFRS.
IFRS 15 “Revenue from Contracts with Customers” and further amendments (effective for annual periods
beginning on or after 1st January 2018).
IFRS 15 “Revenue from Contracts with Customers” issued by IASB on 28 May 2015 (on 11 September 2016
IASB deferred effective date of IFRS 15 to 1st January 2018). IFRS 15 specifies how and when an IFRS
reporter will recognize revenue as well as requiring such entities to provide users of financial statements with
more informative, relevant disclosures. The standard supersedes IAS 18 “Revenue”, IAS 11 “Construction
Contracts” and a number of revenue-related interpretations. Application of the standard is mandatory for all
IFRS reporters and it applies to nearly all contracts with customers: the main exceptions are leases, financial
instruments and insurance contracts. The core principle of the new Standard is for companies to recognize
revenue to depict the transfer of goods or services to customers in amounts that reflect the consideration (that
is, payment) to which the company expects to be entitled in exchange for those goods or services. The new
Standard will also result in enhanced disclosures about revenue, provide guidance for transactions that were
not previously addressed comprehensively (for example, service revenue and contract modifications) and
improve guidance for multiple-element arrangements.
Amendments to IFRS 10 “Consolidated Financial Statements” and IAS 28 “Investments in Associates and
Joint Ventures” - Sale or Contribution of Assets between an Investor and its Associate or Joint Venture and
further amendments (effective date was deferred indefinitely until the research project on the equity method
has been concluded).
Amendments to IFRS 10 “Consolidated Financial Statements” and IAS 28 “Investments in Associates and
Joint Ventures” - Sale or Contribution of Assets between an Investor and its Associate or Joint Venture issued
by IASB on 11 September 2015 (on 17 December 2016 IASB deferred indefinitely effective date). The
amendments address a conflict between the requirements of IAS 28 and IFRS 10 and clarify that in a
transaction involving an associate or joint venture the extent of gain or loss recognition depends on whether
the assets sold or contributed constitute a business.
Amendments to IFRS 10 “Consolidated Financial Statements”, IFRS 12 “Disclosure of Interests in Other
Entities” and IAS 28 “Investments in Associates and Joint Ventures” - Investment Entities: Applying the
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
31
Consolidation Exception (effective for annual periods beginning on or after 1st January 2016).
Amendments to IFRS 10 “Consolidated Financial Statements”, IFRS 12 “Disclosure of Interests in Other
Entities” and IAS 28 “Investments in Associates and Joint Ventures” - Investment Entities: Applying the
Consolidation Exception issued by IASB on 18 December 2015. The narrow-scope amendments to IFRS 10,
IFRS 12 and IAS 28 introduce clarifications to the requirements when accounting for investment entities. The
amendments also provide relief in particular circumstances.
Amendments to IFRS 11 “Joint Arrangements” – Accounting for Acquisitions of Interests in Joint Operations
(effective for annual periods beginning on or after 1st January 2016).
Amendments to IFRS 11 “Joint Arrangements” – Accounting for Acquisitions of Interests in Joint Operations
issued by IASB on 6 May 2015. The amendments add new guidance on how to account for the acquisition of
an interest in a joint operation that constitutes a business. The amendments specify the appropriate
accounting treatment for such acquisitions.
Amendments to IAS 1 “Presentation of Financial Statements” - Disclosure Initiative (effective for annual
periods beginning on or after 1st January 2016).
Amendments to IAS 1 “Presentation of Financial Statements” - Disclosure Initiative issued by IASB on 18
December 2015. The amendments to IAS 1 are designed to further encourage companies to apply
professional judgement in determining what information to disclose in their financial statements. For example,
the amendments make clear that materiality applies to the whole of financial statements and that the inclusion
of immaterial information can inhibit the usefulness of financial disclosures. Furthermore, the amendments
clarify that companies should use professional judgement in determining where and in what order information
is presented in the financial disclosures.
Amendments to IAS 16 “Property, Plant and Equipment” and IAS 38 “Intangible Assets” - Clarification of
Acceptable Methods of Depreciation and Amortization (effective for annual periods beginning on or after 1st
January 2016).
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
32
Standards and Interpretations in issue not yet adopted - continued
Amendments to IAS 16 “Property, Plant and Equipment” and IAS 38 “Intangible Assets” - Clarification of
Acceptable Methods of Depreciation and Amortization issued by IASB on 12 May 2015. Amendments clarify
that the use of revenue-based methods to calculate the depreciation of an asset is not appropriate because
revenue generated by an activity that includes the use of an asset generally reflects factors other than the
consumption of the economic benefits embodied in the asset. Amendments also clarify that revenue is
generally presumed to be an inappropriate basis for measuring the consumption of the economic benefits
embodied in an intangible asset. This presumption, however, can be rebutted in certain limited circumstance.
Amendments to IAS 16 “Property, Plant and Equipment” and IAS 41 “Agriculture” - Agriculture: Bearer Plants
(effective for annual periods beginning on or after 1st January 2016).
Amendments to IAS 16 “Property, Plant and Equipment” and IAS 41 “Agriculture” - Agriculture: Bearer Plants
issued by IASB on 30 June 2015. The amendments bring bearer plants, which are used solely to grow
produce, into the scope of IAS 16 so that they are accounted for in the same way as property, plant and
equipment
Amendments to IAS 27 “Separate Financial Statements” - Equity Method in Separate Financial Statements
(effective for annual periods beginning on or after 1st January 2016).
Amendments to IAS 27 “Separate Financial Statements” - Equity Method in Separate Financial Statements
issued by IASB on 12 August 2015. The amendments reinstate the equity method as an accounting option for
investments in in subsidiaries, joint ventures and associates in an entity's separate financial statements.
Amendments to various standards “Improvements to IFRSs (cycle 2012-2015)” issued by IASB on 25
September 2015. Amendments to various standards and interpretations resulting from the annual
improvement project of IFRS (IFRS 5, IFRS 7, IAS 19 and IAS 34) primarily with a view to removing
inconsistencies and clarifying wording. The revisions clarify the required accounting recognition in cases
where free interpretation used to be permitted. Changes include new or revised requirements regarding: (i)
changes in methods of disposal; (ii) servicing contracts; (iii) applicability of the amendments to IFRS 7 to
condensed interim financial statements; (iv) discount rate: regional market issue; (v) disclosure of information
'elsewhere in the interim financial report'. The amendments are to be applied for annual periods beginning on
or after 1st January 2016.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
33
2. Interest income
Classification 2016 2015
GHS GHS
Loans and advances 1,131,457,776 499,800,872
Placement and special deposits 110,534,506 44,999,958
Investment securities 105,891,142 87,999,170
1,347,883,423 632,800,000
No interest has been accrued on impaired loans for the year (2015: nil) 3. Interest expense
2016 2015
GHS GHS
Current account 23,936,095 13,072,406
Time and other deposits 557,856,433 292,643,840
Borrowings 462,961,767 190,231,639
1,044,754,294 495,947,885
4 Fee & Commission Income
2016 2015
GHS GHS
Foreign transfers & LCs 15,077,547 15,703,984 Loan processing fees 11,531,829 22,302,176 Commission on turnover 121,916 351,863 Commission on clearing 612,967 340,005 Other commissions 12,940,408 5,544,470
40,284,666 44,242,498
The reported credit related fees and commissions are those which are not regarded as part of the effective interest rate on loans.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
34
5a Trading Income 2016 2015
GHS GHS
Forex Trading 49,391,371 55,217,502
2016 2015 5b Operating Income GHS GHS
Revaluation Gain/(loss) on foreign currency 120,313 22,632,813
Rent from Premises Sub-let - 25,530
120,313 22,658,343
6. Other expenses
2016 2015
GHS GHS
Advertising & marketing 20,722,750 23,700,872
Administrative expenses 132,634,544 93,735,206
Directors‟ emoluments: Executive 3,397,951 2,789,836
Non-executive 352,875 411,225
Auditors‟ remuneration 228,000 200,000
Rent 16,377,089 9,552,341
173,713,208 130,389,480
7. Personnel expenses 2016 2015
GHS GHS
Staff salaries & allowance 49,302,466 36,312,849 Social Security cost 5,211,527 3,888,293
Other staff benefits 8,523,364 5,999,186
63,037,357 46,200,328
8. Impairment loss
2016
2015
GHS GHS
Specific impairment charges 81,571,957 12,363,501
Portfolio impairment charges/(Gain) (1,324,386) 8,318,676
Charge for the year 80,247,571 20,682,177
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
35
9. Taxation a. Current tax
2016 2015
GHS GHS
Balance at 1st January 54,392 (857,043) Prior year adjustment (under provision) - 1,054,927 Charge for the year 12,074,916 8,672,897
Payments (10,958,952) ,816,389)
1,170,356 54,392 b. Deferred tax 2016 2015
GHS GHS
Balance at 1st January 4,735,154 3,631,745
Charge to profit or loss 2,654,174 1,103,409
-
Balance at 31st December 7,389,328 4,735,154
9c
National Fiscal Stabilization Levy
2016 2015
Balance at 1 January 167,325 455,836
Charge for the year 2,984,435 2,566,326
Payments (2,820,713) (2,854,837)
----------------------- -------------------
Balance at 31 December 331,047 167,325
============= ===========
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
36
d. Income tax expense
2016 2015
GH¢ GH¢
Profit before income tax 59,688,694 51,326,509
Tax at applicable tax rate at 25% 14,922,174 12,831,627
Tax effect of non-deductible expenses (353) 408,555
Tax effect of non-chargeable income 234,169 (3,200,293)
Tax effect of allowable expenditure - (1,285,665)
Tax effect on capital allowance - 1,022,081
Origination/reversal of temporary (390,320) -
14,765,669 9,776,305
25% 19%
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
37
10. Cash and cash equivalent 2016 2015
GHS GHS
Cash on hand 65,224,154 31,772,826
Balances with other Banks (Nostro) 20,542,729 21,546,521
Balances with Bank of Ghana 539,363,701 317,566,199
Money market placement 858,828,322 273,768,860
Items in Course of collection 19,457,064 16,753,842
1,503,415,970 661,408,248
11. Trading assets
2016 2015
GHS GHS
Pledged Non Pledged Total Pledged Non Pledged Total
Government bonds - 5,001,952 5,001,952 - 5,298,664 5,298,664
Treasury bills 511,600,274 433,076,795 944,677,069 42,945,935 338,579,557 381,525,492
511,600,274 438,078,747 949,679,021 42,945,935 343,878,221 386,824,156
These are fixed rate Government of Ghana securities maturing between 2017 and 2021. The average rate of return on these instruments is 22.28%. Treasury bills is made up of 91d bills of GHS823,331,432 and other bills of GHS121,345,637.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
38
12. Loans and advances to customers Analysis by type
2016 2015
GHS GHS
Overdrafts
682,479,705 914,629,034
Term Loans
2,326,775,670 1,604,030,677
Gross loans & advances
3,009,255,375 2,518,659,711
Impairment Allowance (13a)
(123,716,598) (43,469,027)
Net loans & advances
2,885,538,777 2,475,190,684
Analysis by business segment
Agriculture, forestry and fishing
4,516,446 3,632,748
Mining and quarrying
77,926,112 38,921,635 Manufacturing
81,567,690 32,431,645
Construction
754,355,187 537,713,778 Electricity, gas and water
227,189,720 640,429,242
Commerce and finance
655,418,764 502,727,092 Transport, storage and communication
300,498,883 207,665,374
Services
727,648,509 288,067,822 Miscellaneous
180,134,065 267,070,375
3,009,255,375 2,518,659,711
Analysis by type of customers
Individuals
219,924,049 173,250,022
Private enterprises
2,739,633,955 2,309,258,666 Staff
49,697,371 36,151,023
3,009,255,375 2,518,659,711
a. Movement in bank’s provisions for impairment are as follows:
2016 2015
GHS GHS
Balance brought forward
43,469,027 22,786,850
Impairment (Note 8)
80,247,571 20,682,177
123,716,598 43,469,027
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
39
2016 2015
b. Loans and advances measured at amortized cost GHS GHS
Gross Loans and advances 3,009,255,375 2,518,659,711
Interest receivable 189,576,520 126,324,986
3,198,831,895 2,644,984,697
13. Other asset
2016 2015
GHS GHS
Stocks
370,477 549,386 Interest receivables
189,576,520 126,324,986
Deposits and prepaid expenses
12,167,383 11,400,817 Others (Note 14a)
27,199,132 13,222,319
229,313,512 151,497,508 a. Analysis of others
Sundry debtors
8,461,285 1,633,202
Security deposit – Mastercard
1,050,050 948,750 Deposit for Asset (advance payment)
4,484,431 5,096,270
Sigue Money Transfer
- 86388 Moneygram Money Transfer
3,392,658 -
Express Money Transfer
929,400 -
Western Union Money Transfer
1,096,498 41254 Ghana Post
50,000 50000
Security Deposit Ghana Leasing
1,014,687 1,014,687 Small World Money Transfer
1,980,822 521,815
RIA Money Transfer
15,532 72,961 Biometric Passport Forms
315,015 26,537
Due Commission (Contingent)
279,992 - Cash Collateral – Ghana International Bank 4,128,763 3730455
27,199,132 13,222,319
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
40
14a. Property, Plant and Equipment
Freehold Land &
Buildings
Leasehold Land
& Buildings
Computer
Software
Computers
Equipment
Furniture
& Fittings
Motor
Vehicles
Work in
Progress
Total
Cost/Revaluation GHS GHS GHS GHS GHS GHS GHS GHS GHS
Balance at 1st January 2016
14,557,812
83,328,057
8,628,444
4,611,772
17,863,744
4,254,152
8,126,463
37,021,888
178,392,332
Additions/Transfers during the year
18,747,020
2,361,748
1,609,848
13,068,892
1,651,112
127,778
(1,894,695)
35,671,703
Disposals
(3,000)
-
-
(747,540)
-
(750,540)
Adjustment - - - - - - - - -
Balance as at 31st December 2016
14,557,812
102,075,077
10,990,192
6,218,621
30,932,636
5,905,264
7,506,701
35,127,193
213,313,495
Depreciation
Balance at 1st January 2016
571,928
8,419,559
2,336,427
2,174,049
4,269,627
1,097,561
3,511,311
-
22,380,462
Disposals
(2,083)
(546,792)
-
(548,875)
Charge for the year
241,029
6,035,406
829,082
1,673,052
5,102,346
717,756
1,639,978
___________
16,238,648
Balance as at 31st December 2016
812,957
14,454,965
3,165,509
3,845,018
9,371,973
1,815,317
4,604,498
___________-
38,070,235
NBV as at 31st December 2016
13,744,855
87,620,112
7,824,683
2,373,602
21,560,663
4,089,947
2,902,203
35,127,193
175,243,260
Disposal Cost Accum. Deprn. NBV Proceeds Profit/loss
GHS GHS GHS GHS GHS
Computers
3,000
2,083
917
- -
Motor Vehicle
747,540
546,792
200,748
- -
750,540
548,875
201,665
-
-
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
41
14b. Property, Plant and Equipment
Freehold Land & Buildings
Leasehold Land & Buildings
Computer Software
Computers
Equipment
Furniture & Fittings
Motor Vehicles
Work in Progress
Total
Cost/Revaluation GHS GHS GHS GHS GHS GHS GHS GHS GHS
Balance at 1st January 2015
22,029,388
81,429,324
4,347,568
2,993,567
11,598,265
3,449,476
5,890,077
42,734,611
174,472,276
Additions during the year -
17,089,646
4,280,876
1,618,205
6,265,479
804,676
2,430,188
4,481,292
36,970,362
Disposals
(7,471,576)
(15,190,913) - - - -
(193,802)
-
(22,856,291)
Adjustment - - - - - - - (10,194,015) (10,194,015)
Balance as at 31st December 2015 14,557,812 83,328,057 8,628,444 4,611,772 17,863,744 4,254,152 8,126,463 37,021,888 178,392,332
Depreciation
Balance at 1st January 2015
543,039
5,958,249
1,632,750
948,301
1,304,723
512,089
2,078,984
-
12,978,135
Disposals
(274,403)
(586,799) - - - -
(108,435) -
(969,637)
Charge for the year
303,292
3,048,109
703,677
1,225,748
2,964,904
585,472
1,540,762 -
10,371,964
Balance as at 31st December 2015 571,928 8,419,559 2,336,427 2,174,049 4,269,627 1,097,561 3,511,311 _________- 22,380,462
NBV as at 31st December 2015 13,985,884 74,908,498 6,292,017 2,437,723 13,594,117 3,156,591 4,615,152 37,021,888 156,011,870
Disposal Cost Accum. Deprn. NBV Proceeds Profit/loss
GHS GHS GHS GHS GHS
Freehold land & building
7,471,576
274,403
7,197,173
(7,197,173)
-
Leasehold land & building
15,190,913
586,799
14,604,114
(14,604,114)
-
Motor Vehicle
193,802
108,435
85,367
(85,367)
-
Work-in-progress
10,194,015
-
10,194,015
(10,194,015) -
33,050,306
969,637
32,080,669
(32,080,669) -
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
42
15. Deposits from customers 2016 2015
GHS GHS
Current accounts 951,964,666 827,444,434
Time deposit 1,469,617,376 1,755,526,167
Savings deposit 194,296,990 145,171,588
2,615,879,033 2,728,142,189
Analysis by type of Depositors
Financial Institutions 275,079,966 281,695,038.
Individuals and other Private Enterprises 1,756,174,892 1,598,077,688.
Public Enterprises 584,624,175 848,369,463
2,615,879,033 2,728,142,189
Ratio of 20 largest depositors total deposits 0.37 0.48 16. Borrowings
2016
2015
GHS GHS
Interbank market 2,008,839,200 478,807,900
Commercial paper issue 26,850,000 13,050,000
Managed Fund 76,815 76,815
GIB Loan - 34,787,500
Shelter Afrique - 24,667,500
ResponsAbility 75,603,600 68,310,000
European Investment Bank 40,042,419 40,820,060
African Development Bank 63,003,000 -
Mauritius Commercial Bank 42,002,000 -
African Export Bank 52,240,513 -
Symbiotics 22,518,850 -
Cargill 63,003,000 -
2,394,179,397
660,519,775
The interbank market are borrowings from other banks which attracts an average interest rate of 25.02%.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
43
a. Analysis of Borrowings
2016
2015
GHS GHS
Due within one year
2,215,453,563
555,511,574
Due after one year 178,725,834 105,008,201
2,394,179,397
660,519,775
Terms and conditions of Foreign Loans: These were loans of US$18 million at rate of USD 6-month libor plus five hundred and fifty basis point for two years and US$10.7 million with floating rate plus 2% (200 basis points) for 8 years from Responsibility and European Investment Bank respectively. The Bank contracted additional loans of US$ 15 million at a rate of 6.52% for 3 years, US$ 10 million at a rate of 5.09% for 1 year, US$ 12.4 million at a rate of 6.37% for 1 year nine months and US$ 3 million at a rate of 6.25% for 6 months from African Development Bank, Mauritius Commercial Bank, African Export Bank and Symbiotic respectively. Additionally, an amount of GHS 9.9 million at a rate of 27.1% for 6 months was borrowed from Symbiotic. During the year the Ghana International Bank (GIB) and Shelter Afrique loans were paid off. None of the bank assets was used to secure these loans. The Bank has not had any default of principal, interest or other breaches with regard to any of the bank‟s liabilities. . 17 Other Liabilities 2016 2015
GHS GHS
Interest payable 187,642,006 96,600,292 Payment orders 5,863,905 8,209,090 Banker‟s payments 4,294 5,679 Margin account 1,220,144 2,556,578 Other creditors and accruals (19a) 48,178,539 25,209,852 Deferred Income – Loan Processing Fee 3,575,936 3,950,755
246,484,824 136,532,246
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
44
17a.
Included in other creditors and accruals is the obligation for the company's long service scheme. The
Actuarial valuation of the present value of the defined benefit obligation were carried out at 31
December 2016 by Mr. Isaac Senior Damptey, ACIA, ASA, ACA. The present value of the defined
benefit obligation and the related service cost were measured using the projected unit credit method.
The principal assumptions used for the purposes of the actuarial valuations were as follows;
Mortality: The RP 2000 Mortality Table
Salary Scale: Salaries are assumed to increase at an annual average rate of 10%.
Inflation Rate: An average inflation rate of 15.4%.
Discount Rate: A discount rate of 14.5%.
Asset Return/ Investment Yield: An investment yield rate of 22%.
Turnover Rate: A turnover rate of 5% is assumed
Retirement Age: Retirement age is set at age 60
PRINCIPAL RESULTS OF VALUATION
01-Jan-16 Service
Cost
Net
interest
expense
Sub-total
included in
profit or
loss
Benefits
paid
Return on
plan
assets(exclu
ding
amounts
included in
net interest
expense)
Actuarial
changes
arising
from
changes in
demograp
hic
assumptio
ns
Actuarial
changes
arising
from
changes
in
financial
assumpti
ons
Experi-
ence
adjust
ments
Sub-
total
includ
ed in
OCI
Contri-
bution
s by
emplo
yer
31-Dec-16
544,458 35,308 126,994 162,302 120,000 - - - - - - 586,760
Pension cost charged to profit or loss Remeasurement gains/(losses) in other comprehensive income
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
45
SENSITIVITY ANALYSIS
Discount rate 22.00% 19.80% 24.20% 22.00% 22.00% Salary increase 15.00% 15.00% 15.00% 13.50% 16.50% Defined Benefit Obligation 586,760 586,801 557,383 585,880 586,786 Current Service Cost 35,308 35,310 35,305 35,310 35,310 As % of monthly Salaries 10% 10% 10% 10% 10% Number of Employees 803 803 803 803 803 Monthly Basic Salaries (GHS) 3,432,559 3,432,559 3,432,559 3,432,559 3,432,559 18. Stated Capital
a. Authorised Shares of no par value
2016 2015
Issued and fully paid: 100,000,000
100,000,000
Number Value Number Value
GHS
GHS
Ordinary Shares:
Issued for Cash Consideration 119,002,836 261,919,503 62,752,835 126,919,503
Issued for Consideration other than cash 2,245,352 2,245,352 2,245,352 2,245,352
Transfer from Income Surplus 7,506,701 15,965,035 7,506,702 15,965,035
128,754,889 280,129,890 72,504,889 145,129,890
Preference Shares
Issued for Cash Consideration 1,500 15,000,000 1,500 15,000,000
295,129,890
160,129,890
Ordinary Shares issued for Consideration other than cash are equity injections in the form of Landed properties with values of GHS206,352, GHS1,539,000, and GHS500,000 which were brought in 2001, 2004 and 2008 respectively.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
46
b. Shareholding Structure
Value Number Percentage
Ordinary Shares
GHS of Shares Shareholding
Integrated Properties Limited
41,757,638 21,710,770 16.86%
Telemedia Company Limited
35,565,062 18,656,111 14.49%
Dr. Kwabena Duffuor
26,715,538 14,600,490 11.34%
Crown Insurance Brokers Limited
1,071,064 854,428 0.66%
HODA Holdings Limited
175,000,000 72,916,667 56.63%
Aaron M. Ocquaye & Others
11,339 9,045 0.01%
Seth Adom-Asomaning
9,249 7,378 0.01%
Total
280,129,890 128,754,889 100
Preference Shares
Dr. Kwabena Duffuor
11,500,000 1,150 76.67%
Crown Insurance Brokers Limited
3,500,000 350 23.33%
Total
15,000,000 1,500 100
Stated Capital
295,129,890
Conditions on Preference Shares Preference Shares are non-cumulative and irredeemable of no par value issued for a consideration of GHS10,000.00 (Ten thousand Ghana cedis) per share. Each preference share shall attract dividend at the rate of 17% per annum 19a. Revaluation reserve This relates to revaluations of the Bank's property, plant and equipment.
2016 2015
Balance at 1st January
22,620,091 22,620,091
19b. Statutory Reserve Fund This represents the cumulative amounts set aside as a non-distributable reserve from annual net profit after tax in accordance with Section 29 (1) of the Banking Act, 2016 (Act 930 The amounts transferred annually range from 12.5% to 50% of net profit after tax.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
47
20. Regulatory Credit Risk Reserve
Regulatiry Credit Risk Reserve
2016 2015
Balance at 1 January 13,853,226 11,934,326
Provision as per BOG Classification 85,834,312 22,601,077
IFRS impairment (80,247,571) (20,682,177)
Regulatory credit risk 5,586,741 1,918,900
Balance at 31 December 19,439,968 13,853,226
This represents the excess of provision for bad and doubtful debts in respect of loans as per Bank of Ghana guidelines and loan impairment loss provision as per IFRS 21. Income Surplus This represents the residual of cumulative annual profits that are available for distribution to shareholders. 22. Cash and cash equivalents For the purposes of the cash flow statements, cash and cash equivalents comprise balances with less than 91 days maturity from the date of acquisition.
Interbank borrowing (note 16) (2,008,839,200) (478,807,900)
317,908,202 440,652,144
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
48
23. Contingents & Commitments
In common with other Banks, the Bank conducts business involving acceptances, guarantees, performance bonds and indemnities. The majority of these facilities are offset by corresponding obligations to third parties.
As at 31st December, 2016 the Bank has contingencies and commitments as follows:
2016 2015
GHS GHS
Bonds and Guarantees
21,727,083 31,107,589
Letters of Credit
155,108,933 104,836,012
176,836,016 135,943,601
Nature of contingent liabilities
Letters of credit commit the Bank to make payment to third parties, on production of documents, which are subsequently reimbursed by customers. Guarantees are generally written by the Bank to support performance by a customer to third parties. The Bank will only be required to meet these obligations in the event of the customer's default. As at the year end, there has been no default by any customer.
24 Related parties 2016 2016 2015 2015 Group during the period are as follows: Maximum Bal. Closing Bal. Maximum Bal. Closing Bal. GHS GHS GHS GHS Mortgage lending and other secured loans 459,419 435,811 295,085 276,348 Other Loans 253,829 105,536 164,009 138,746 Total
713,248
514,347
459,094
415,094
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
49
Interest rates charged on balances outstanding are at an arm‟s length transaction. The mortgages and secured
loans granted are secured over property of the respective borrowers. Other balances are secured by staff
provident fund. No impairment losses have been recorded against balances outstanding during the period with key
management personnel, and no specific allowance has been made for impairment losses on balances with key
management personnel and their immediate relatives at the period end.
Key management personnel compensation for the period comprised:
2016 2015
Short-term employee benefits
Long-service leave
3,397,951
2,789,836
Post-employment benefits
- -
In addition to their salaries, the Bank also provides non-cash benefits to directors and executive officers.
2016 2015
(a) Loans and advances to employees
Balance at 1 January
36,151,023 26,975,668
Loans advanced during the year
27,980,095 22,581,638
Loan repayments received
(14,458,348)
(13,406,283)
Balance at 31 December
49,672,770 36,151,023
(b) Loan and advances to directors and their associates
The Bank has entered into transactions with its directors and their associates as
follows:
2016 2015
Gross amount at 1 January
GHS 789,939
GHS 303,842
Interest charged
276,479 121,537
Loans disbursed
150,000 420,000
Cash received
(675,071) (55,440)
Net amount at 31 December
541,347 789,939
All the transactions with related parties are priced at arm‟s length basis and have been entered into in the normal course
of business.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
50
2016 2015
25. Operating Expenses
GHS GHS
Staff Cost
Salaries
40,351,065 29,741,988
Allowances
8,951,401 6,570,863
Social security
5,211,527 3,888,293
Provident Fund
1,809,137 1,313,769
Employees Gratuity Scheme
162,302 -
Medical
4,041,971 2,022,810
Training
2,096,527 1,665,040
National Service Allowance
123,760 215,503
Staff Welfare
289,667 782,062
Sub-Total
63,037,357 46,200,328
Other Operating Costs
Corporate Social Responsibility
6,937,981 7,403,064
Advertising & Publication
7,901,426 9,547,400
Promotion
5,835,354 6,783,620
Printing & stationery
3,779,450 2,424,170
Lease rental charges
3,509,108 6,134,572
Travel Expenses
12,475,676 9,183,598
Fuel and lubricants
19,538,565 17,152,206
Subscriptions and Fees
2,924,548 1,298,458
Software Maintenance fee - Globus
1,770,531 1,124,344
Internet and Swift Cost
3,841,770 3,747,774
Repairs & Maintenance
17,456,856 9,475,474
Insurance
933,233 887,372
Communications and Expenses
595,267 796,730
Legal fees
228,000 1,212,643
Professional Fees
5,645,698 6,709,283
Cleaning & Sanitation
2,937,956 1,760,473
Outsourced Services
14,459,443 9,944,536
Specie
5,761,754 4,114,343
Security Services
6,848,276 4,844,449
Correspondent bank charges
2,482,321 1,135,061
Other Expense
2,214,946 2,653,925
Depreciation
16,238,648 10,372,131
Directors` Emoluments - Executive
3,397,951 2,789,836
Non-Executive
352,875 411,225
Audit Fees
473,496 223,806
Rent
16,377,089 9,552,341
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
51
Office utilities
8,366,090 3,847,798
Repairs & Maintenance - Premises
11,860,147 2,063,927
E-Zwich Charges
26,743 42,170
e-Banking Charges
945,083 593,656
ATM Charges
2,597,813 1,104,693
Mastercard Expenses
1,237,763 1,426,366
Sub - Total
189,951,857 140,761,444
Total
252,989,213 186,961,772
Financial Risk Management
i. Introduction and Overview
The types and degree of financial risks organization may be exposed to depend largely on the size and complexity
of business activities. However, uniBank is generally exposed to credit, market, liquidity, operational, compliance,
legal, regulatory and reputational risks.
The Bank‟s risk management framework, objectives, policies, procedures and processes for identifying,
measuring, monitoring and controlling these risks, and regulatory capital management is presented below;
Risk Management Framework
The Board of Directors and Senior Management have developed and established policies and procedures to
facilitate effective risk management. These policies and procedures provide guidance on risk appetite/tolerance
limit, risk identification, monitoring and controlling and adherences to the set risk limits. The risk management
policies and procedures are reviewed periodically to reflect changes in economic and financial landscape as well
as products and services offered.
The Board of Directors has the overall responsibility for the establishment and oversight of the Bank‟s risk
management framework. The responsibilities of the Board of Directors include; setting out the Bank‟s overall risk
appetite/tolerance limit, ensuring that the Bank‟s overall risk exposure is maintained at prudent levels and
consistent with available capital. They also include; ensuring that Executive Management as well as individuals
responsible for Risk Management possess sound expertise and knowledge to accomplish the risk management
function and ensuring that appropriate policies and procedures for risk management are in place.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
52
The Board of Directors has established Assets and Liability Management Committee (ALCO), Management Credit
Committee and Operational Risk Management Committee. Membership of these Committees includes Executive
Management and Heads of Departments which report on periodic basis to the Board of Directors. These
Committees are responsible for developing, implementing and monitoring of risk policies and strategies approved
by the Board.
The Board through its sub-committees on Audit and Risk Management monitors compliance with the Bank‟s risk
management strategies, policies and procedures, and periodically reviews the adequacy of the overall risk
management framework in relation to the business activities and the risk profile of the Bank.
ii. Credit Risk
Credit Risk arises from the potential that an obligor is either unwilling to perform on an obligation or its ability to
perform such obligation is impaired resulting in economic loss to the Bank. Credit Risk stems from outright default
due to inability or unwillingness of a customer or counterpart to meet commitments in relation to lending, trading
settlement and other financial transaction. Losses may also result from reduction in portfolio value due to the
actual or perceived deterioration in credit quality.
The Management Credit Committee is responsible for implementation of the credit risk policy/strategy, monitors
credit risk on a Bank-wide basis and ensures compliance with credit limits approved by the Board. To maintain
credit discipline, the Credit Risk Management Department is a separate function independent of loan origination
function. The Credit Risk Department is responsible for credit policy formulation, credit approval, credit limit setting,
monitoring of credit exceptions/exposures and reviewing/monitoring of security documentations.
Business strategies, policies and procedures for managing credit risk are determined bank-wide with specific
policies and procedures being adopted for corporate, small and medium enterprises and consumer loans.
The Bank‟s Credit Risk Rating framework incorporates both business risk and financial risk analysis using both
qualitative and quantitative factors/parameters. Among these factors/parameters are industry characteristics,
competitive position, management depth, financial condition, and profitability, and capital structure, present and
future cash flows.
A numerical grading system 1-8, with 1 being the highest quality are used to quantify the risk associated with each
counterparty within the corporate loan portfolio. For the consumer loans, standard application forms are used to
process and approve loans.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
53
Managing Problem Credits
All facilities 90 days past due (excesses and overdue) or when three loan installment payments are missed are
transferred to the Monitoring and Recovery Unit. Monitoring and Recovery Unit manages and collects/regularizes
delinquent facilities after unsuccessful remedial effort by the Business Unit.
At 360 days past due, where recovery efforts are unsuccessful, the Monitoring and Debt Recovery Unit refers the
customer to contractual external collectors (for small facilities, mainly retail and SME‟s customer‟s facilities). For
large corporate and SME‟s that are supported by security, Monitoring and Recovery Unit refers the customer to the
Bank‟s Legal Department.
Loan Loss Provisioning
Loan losses are anticipated and charged against the profit and loss accounts on monthly basis. The balance in the
loan loss provision account is always equal to at least the required provisions based on the Bank‟s current credit
risk rating profile. If the loss classifications increase, the balance of the loss provision account is also increased by
an additional charge against earnings. In conformity with Bank of Ghana„s directives, the minimum provision that
are held are as follows;
Credit Risk Rating Days past Due Minimum Provision
Required (%)
Current <30 1
OLEM 31-90 10
Substandard 91-180 25
Doubtful 181-360 50
Loss Over 360 100
CREDIT RISK EXPOSURE
Maximum credit exposure
At 31st December 2016, the maximum credit risk exposure of the Bank in the event of other parties failing to
perform their obligations is detailed below. No account has been taken of any collateral held and the maximum
exposure to loss is considered to be the instruments‟ balance sheet carrying amount or, for non-derivative off-
balance sheet transactions, their contractual nominal amounts.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
54
Credit Risk Exposure (Cont’d) At 31 December 2016, the maximum credit risk exposure of the Bank in the event of other parties failing to perform
their obligations is detailed below. No account has been taken of any collateral held and the maximum exposure
to loss is considered to be the instruments‟ balance sheet carrying amount or, for non-derivative off-balance sheet
transactions, their contractual nominal amounts.
2016 2015 GHS GHS
Placement with other Banks
505,733,750 273,768,860
Loans and Advances 3,051,999,471 2,539,301,580
Unsecured Contingent Liabilities and Commitments 176,836,016 135,943,601
3,734,569,236 2,949,014,041
Set out below is an analysis of various credit exposures.
Analysis by credit grade of loans and advances
Loans and receivables
Impaired loans
Individually impaired
336,748,257 51,559,820
Allowance for impairment
(81,571,957) (24,079,709)
Impaired loans, net of individual provisions 255,176,300 27,480,111
Credit grading 1-8 or equivalent 2,672,507,118 2,487,741,760
Portfolio impairment assessment Gain/ (loss) 1,334,386 (21,308,218)
Total net loans
2,673,841,504 2,466,433,542
Fair value of Collateral held The Bank holds collateral against loans and advances to customers in the form of mortgage interests over
property, other registered securities over assets, and guarantees. Estimates of fair value are based on the value
of collateral assessed at the time of borrowing, and generally are not updated except when a loan is individually
assessed as impaired.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
55
An estimate of the fair value of collateral and other security enhancements held against financial assets is shown
below:
Loans and receivables
2015 2014
GHS GHS
Against impaired assets
186,280,507 3,947,912
Against past due but not impaired assets
1,651,337,514 1,102,853,841
1,837,618,021
1,106,801,753
Collateral reposed
The Bank took possession of some customer collateral during the year, and has disposed them to defray the related exposures. Commitment and guarantees
The Bank‟s maximum credit risk exposure for commitment and guarantees amounts to GHS176, 836,016 (2015
GHS135, 943,601).
iii. Market Risk
Market risk is the potential for loss resulting from adverse movement in risk factors such as interest rates, foreign
exchange rates, and equity and commodity prices.
The Bank‟s Assets and Liability Committee (ALCO) has oversight of the market risk management. The ALCO
defines the standards and methodologies for market risk management and provides a second level control over
the operating units.
The Bank‟s Market Risk Unit (under the supervision of the ALCO) is responsible for the management of the Bank‟s
market risk. The Unit provides oversight and guidance on policy setting, limit setting, funding, and currency and
counterparty concentrations. The Unit also carries daily analysis (independent of the front office) of the exposures
and risk incurred by the Bank and comparison of said exposures and risk with the set limits.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
56
Interest Rate Risk
In order to quantify the Bank‟s exposures to structural interest rate risk, assets and liabilities with fixed and floating
rates are analyzed to identify any gap. Maturities on outstanding positions are determined on the basis of
contractual terms governing transactions, model based on historic client behavioral patterns (special saving
accounts, early repayments, etc), as well as conventional assumptions relating to certain aggregate (principally
shareholders‟ equity and sight deposits). Once the Bank identifies its gap, the variation in the net present value of
the fixed-rate position corresponding to an immediate parallel shift of 1% in the yield curve is calculated. Also,
analyses are performed on scenarios of potential variations in the net interest income.
A change of a 100 basis points in interest rates at the reporting date would have impacted equity and profit or loss
by the amounts shown below:
100 bp Increase 100 bp Decrease
31st December 2016 GHS GHS
Interest income impact 47,284,591 (47,284,591)
Interest expense impact (50,100,584) 50,100,584
Net impact (2,815,992) 2,815,992
100 bp Increase 100 bp Decrease
31st December 2015 GHS GHS
Interest income impact (6,051,086) 6,051,086
Interest expense impact (7,146,131) 7,146,131
Net impact (13,197,217) 13,197,217
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
57
Liquidity Risk
The Bank‟s liquidity risk management systems comprise two main processes;
1. the assessment of the Bank‟s financing requirements on the basis of budgets and forecasts in order to
plan appropriate funding sources;
2. the analysis of liquidity risk using liquidity crisis scenarios.
The risk analysis is conducted for both on and off statement of financial position items according to currency of
denomination and residual maturity. The principle here is to list assets and liabilities due dates by maturity.
Maturities on outstanding positions are determined on the basis of contractual terms governing transactions, model
based on historic client behavioral patterns as well as conventional assumptions relating to certain assets and
liabilities.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
58
0 - 3 Months
GHS
3 - 6 Months
GHS
6 - 12 Months
GHS
Over 1 Year
GHS Total GHS
Assets
Cash & cash equivalent 877,860,725 225,096,636 53248946 347209663 1,503,415,970
Trading assets (pledged&non-pledged) 815,319,884 122,566,463 4765927 7,026,747 949,679,021
Loans & advances (net) 1,268,903,983 547,303,671 551,949,909 517,381,214 2,885,538,777
Other assets 139,809,352 30,406,265 30,664,395 28,433,500 229,313,512
Property, Plant & Equipment - - - 175,243,260 175,243,260
Total Assets 3,101,893,944 925,373,035 640,629,177 1,075,294,384 5,743,190,540
Liabilites
Customer Deposits 1,081,228,207 550,992,250 506,541,795 477,116,781 2,615,879,033
Borrowings 2,037,258,050 19,050,000 159,145,513 178,725,834 2,394,179,397
Other liabilities 97,428,315 31,273,667 62,547,335 55,235,507 246,484,824
Deffered Tax - - - 7,389,328 7,389,328
Current Tax Liability 1,170,356 - - - 1,170,356
National Fiscal Stabilisation Levy 331,047 - - - 331,047
Total Liabilities 3,217,415,975 601,315,917 728,234,643 718,467,450 5,265,433,985
Net Liquidity Gap -115,522,031 324,057,118 -87,605,466 356,826,934 477,756,555
Maturity Analyis of Assets and Liabilities as at 31 December 2016
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
59
0 - 3 Months
3 - 6
Months 6 - 12 Months Over 1 Year Total
Assets GHS GHS GHS GHS GHS
Cash & cash equivalent 593,098,248 68,310,000 - - 661,408,248
Trading assets (pledged&non-pledged) 302,197,035 79,328,457 - 5,298,664 386,824,156
Loans & advances (net) 955,207,142 365,177,354 617,025,550 537,780,638 2,475,190,684
Other assets 2,804,011 223,354 38,658,938 109,811,205 151,497,508
Property, Plant & Equipment - - - 156,011,870 156,011,870
Total Assets 1,853,306,436 513,039,165 655,684,488 808,902,377 3,830,932,466
Liabilites
Customer Deposits 1,304,434,777 440,177,880 611,960,468 371,569,064 2,728,142,189
Borrow ings 526,558,898 18,254,042 8,236,149 107,470,686 660,519,775
Other liabilities 62,620,935 33,299,821 26,870,823 13,740,667 136,532,246
Deffered Tax - - - 4,735,154 4,735,154
Current Tax Liability 54,392 - - - 54,392
National Fiscal Stabilisation Levy 167,325 - - - 167,325
Total Liabilities 1,893,836,327 491,731,743 647,067,440 497,515,571 3,530,151,081
Net Liquidity Gap -40,529,891 21,307,422 8,617,048 311,386,806 300,781,385
Maturity Analyis of Assets and Liabilities as at 31 December 2015
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
60
The table below shows the contractual expiry by maturity of the Bank‟s contingent liabilities and
commitments. Each undrawn loan commitment is included in the time band containing the earliest date it
can be drawn down. For issued financial guarantee contracts, the maximum amount of the guarantee is
allocated to the earliest period in which the guarantee could be called.
2016 On demand
Less than
3 Months
3 - 12
Months
Over 12
Months Total
GHS GHS GHS GHS GHS
Financial guarantees - 5,982,261 4,274,876 11,469,945 21,727,083
Letters of credit - 145,018,045 10,090,888 - 155,108,933
Other commitments and guarantees - - - - -
Total - 151,000,307 14,365,764 11,469,945 176,836,016
2015
On
demand
Less than
3 Months
3 - 12
Months
Over
12 Months Total
GHS GHS GHS GHS GHS
Financial guarantees - 2,064,500 23,012,417 6,030,673 31,107,590
Letters of credit - 79,146,890 25,689,121 - 104,836,011
Other commitments and guarantees - - - - -
Total - 81,211,390 48,701,538 6,030,673 135,943,601
Foreign Exchange Exposures
The Bank quantifies its exposures to structural exchange rate risk by analyzing all asset and liabilities
denominated in foreign currencies arising from commercial and proprietary trading. The ALCO monitors
the structural exchange rate positions and the open position ratios set by the Bank of Ghana and closes
out the Bank‟s position within individually predetermined limits.
The Bank always seeks to minimize the impact of fluctuations in strong currencies to its net-worth by
maintaining both the single currency and aggregate net open position ratios within the regulatory and
prudential limits. The Bank complied with both the single currency and the aggregate net open position
requirements throughout the period.
A 5% strengthening of the cedi against the following currencies at 31st December 2016 would have
impacted equity and profit or loss by the amounts shown below. This analysis assumes that all other
variables, in particular interest rates, remain constant. The analysis is performed on the same basis for
2015.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
61
Sensitivity analysis Effect in cedis
GHS
31st December 2016
Profit/(Loss)
USD
511,965
GBP
(412,957)
EUR
(93,622)
31st December 2015
USD
770,331
GBP
421,836.
EUR
(379,729)
A best case scenario 5% weakening of the Ghana cedi against the above currencies at 31st December
would have had the equal but opposite effect on the above currencies to the amounts shown above, on
the basis that all other variables remain constant.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
62
CONCENTRATION OF ASSETS, LIABILITIES AND OFF BALANCE SHEET ITEMS
The Bank takes on exposure to the effects of fluctuations in prevailing foreign currency exchange on its financial
position and the cash flows. The table below summarizes the Bank‟s exposure to foreign currency rate risks as
at 31st December 2016.
Included in the table are the Bank‟s assets, liabilities, and off Balance Sheet items at carrying amounts
categorized by currency. The amounts stated in the table are the Cedi equivalents of foreign currencies.
As at 31 December 2016
British
Assets US Dollar Pound Euro Yen
GHS GHS GHS GHS
Cash & cash equivalent 329,194,221 20,263,750 1,753,852 -
Loans and Advances to Customers 522,565,570 782 8,771 -
Others Assets 39,619,755 - - -
Property, Plant and Equipment - - - -
Total Assets 891,379,546 20,264,532 1,762,623 -
Liabilities
Customer Deposits 438,089,716 11,817,771 9,322,795 -
Borrowings 415,698,332 - - -
Other Liabilities 22,184,874 10,023 34,439 -
Total Liabilities 875,972,922 11,827,794 9,357,234 -
Net on Balance Sheet Position 15,406,624 8,436,738 -7,594,611 -
Credit Commitments 159,759,954 - 8,721,647 350,060
At 31 December 2015 (10,239,301) 8,259,146 1,872,442 -
iv. Operational Risk
Operational risk is the risk of loss resulting from inadequate or failed internal processes, people and systems or
from external events. It is the risk of loss arising from the potential that inadequate information systems,
breaches of internal controls, fraud, technological failure and unforeseen catastrophes may result in unexpected
loss or reputational problems.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
63
Over the past two years the Bank has developed a thorough and consistent framework and policies to control
and actively manage its operational risk. The Bank‟s framework complies with the Basel Committee‟s sound
practices for the management and supervision of operational risk and Bank of Ghana‟s requirements. The
Bank‟s Operational Risk Management Committee has oversight of operational risk management. Its main tasks
are to define and implement the strategy for controlling operational risks, establish methods of measurement and
analysis and encourage the application of best practices in this regard.
Risk and Control Self-Assessment (RCSA) methodology for evaluating risks and the control environment has
been formally defined. This process is designed to alert the operating units as soon as possible if they are
vulnerable to risk so that they can react and reduce potential losses. Accordingly, the risks inherent in each
activity are defined in a risk map, and the quality and efficiency of the corresponding prevention and control
procedures are verified on regular basis so as to be able to map any residual risk.
The Bank has maintained a database of all internal operating losses and key risk indicators. These common
databases are used to analyze losses (by event types, cause, activity, etc) and monitor their evolution as well as
the proposed corrective action plans.
v. Compliance and Regulatory Risk
To comply with Bank of Ghana‟s directives and international best practice and standards, the Bank established a
compliance unit in 2008. Specific policies and procedural manuals have been developed to guard against the
risk of non-compliance. Preservation of the Bank‟s interest against anti-money laundering was reinforced and
money laundering monitoring tools was deployed to trace large value transactions to help curb the activities of
money launderers. In order to strengthen the Bank‟s effort against money laundering and terrorism financing,
employees at the head office and branches received dedicated training on anti-money laundering and counter
terrorism financing issues and reporting.
vi. Legal Risk
The Bank is not dependent on any patent or any industrial, commercial or financial contract. Risks arising out of
material litigation matters initiated or likely to be initiated against the Bank are subject to quarterly review. In this
regard, the Operational Risk and the Legal Departments draw up a report every quarter setting forth these
litigations and assess the potential loss if any. These reports are referred to the Board‟s Risk Committees which
give grounded advice on the basis of which Executive Management decides on the reserves amount or its
reversal.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
64
Vii. Reputational Risk
The Bank conducts its business in a responsible, professional and transparent way. By offering simplified
products and following the necessary legal and regulatory processes, the Bank safeguards the interest of its
customers as well as its reputation. Furthermore, the Bank maintains close ties with the communities in which it
operates by supporting them in various ways. This is aimed at demonstrating our commitment and fostering a
long term relationship with our customers and the public at large. We manage our image and reputation in a
professional manner.
viii. Capital Management
The primary objectives of the Bank‟s capital management are to ensure that the Bank complies with externally
imposed capital requirement by the Bank of Ghana and that the Bank maintains strong credit ratings and healthy
capital ratios in order to support its business and maximize shareholders‟ value. The Bank manages its capital
structure and makes adjustment to it in the light of changes in the economic conditions, business activities and
the risk profiles. In order to maintain the desired level of capital, the Bank may vary its dividend policy or issue
new shares. The Bank complied with all externally imposed capital requirement throughout the period.
ix. Regulatory Disclosure
2016
2015
Loan Classification by Status
Gross Loans per BOG Classification
3,051,999,471
2,539,301,580
Performing Loans
2,889,005,732
2,487,741,760
Non-Performing Loans
162,993,739
51,559,820
NPL (%)
5.34%
2.03%
Capital Adequacy Ratio (CAR)
12.64%
10.25%
Loan Loss Provision ratio
0.061:1
0.031:1
Liquidity ratio 32%
20%
Ratio of 50 Largest (funded and non-funded) to exposures (funded and non-funded)
0.70:1
0.54:1
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
65
27. Corporate Social Responsibility Cost An amount of GHS 6,937,981(2015: GHS 7,403,064) was spent under the Bank‟s social responsibility program.
28. Segmental Reporting
Segmental information is presented in respect of the Bank‟s business segments. The Bank is organized into
three main business segments: Corporate, SME and Consumer.
Some of the Bank‟s corporate costs are managed centrally and standardized basis are used to allocate these
costs to the business segments on a reasonable basis.
As at 31 December 2016
CORPORATE SME CONSUMER OTHERS TOTAL
GHS GHS GHS GHS GHS
Interest Income
775,785,469
295,138,014
32,521,160
244,438,781 1,347,883,423
Interest Expense
(450,988,682)
(112,593,033)
(18,057,624)
(463,114,955)
(1,044,754,294)
Net Interest Income
324,796,787 182,544,981 14,463,535
(218,676,173) 303,129,129
Non-Funded Income
32,702,013
13,226,196
1,106,752
42,761,389 89,796,350
Operating Income
357,498,799 195,771,176 15,570,287 -175,914,784 392,925,479
Operating Expenses
(75,717,165)
(17,832,357)
(2,259,888)
(157,179,803)
(252,989,213)
Impairment on loans &advances
(71,604,994)
(8,000,805)
(641,771) -
(80,247,571)
Profit before tax
210,176,640 169,938,014 12,668,627
(333,094,587) 59,688,694
Taxation
(9,581,749)
(7,554,225)
(577,550)
-
(17,713,524)
Profit after tax
200,594,891 162,383,789 12,091,077
(333,094,587) 41,975,170
Cost to Income Ratio (%)
21.18% 9.11% 14.51% -89.35% 64.39%
Net Interest Margin (%)
14.94% 25.10% 24.79% -11.52% 10.07%
Credit Loss Ratio (%)
-3.29% -1.10% -1.10% 0.00% -2.67%
Total Assets
4,166,857,753
1,367,373,387
109,681,600
93,691,059
5,737,603,799
Total Liabilities
3,828,205,546
1,256,243,120
100,767,469
86,076,524
5,271,292,659
Other Segment Items:
Depreciation & Amortization
-
-
-
16,238,648
16,238,648
Capital Expenditure
-
-
-
35,671,536
35,671,536
Loans
2,173,729,558
727,345,944
58,342,855
49,837,018
3,009,255,375
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
66
Segment Revenue reported above represent revenue generated from external customers. There was no intersegment revenue in the current year (2015: Nil) The accounting policies of the reportable segments are the same as the Bank.
As at 31 December 2015
CORPORATE SME CONSUMER OTHERS Total
GHS GHS GHS GHS GHS
Interest Income
359,518,514 103,349,691 10,573,162 159,358,634 632,800,001
Interest Expense
(256,644,780)
(49,107,997)
(6,721,961)
(183,473,147)
(495,947,885)
Net Interest Income
102,873,734 54,241,694 3,851,201 (24,114,513) 136,852,116
Non-Funded Income
37,673,290 12,547,144 410,071 71,487,838 122,118,343
Operating Income
140,547,024 66,788,838 4,261,272 47,373,325 258,970,459
Operating Expenses
(55,991,727)
(13,186,765)
(1,671,154)
(116,112,126)
(186,961,772)
Impairment on loans & advances
(17,022,598)
(3,504,609)
(154,970) -
(20,682,177)
Profit before tax
67,532,699 50,097,464 2,435,148
(68,738,801) 51,326,510
Taxation
(5,885,004)
(6,191,889)
(265,738) -
(12,342,631)
Profit after tax
61,647,695 43,905,575 2,169,410
(68,738,801) 38,983,879
Cost to Income Ratio (%)
39.8% 19.7% 39.2% 247.5% 72.3%
Net Interest Margin (%)
3.3% 10.5% 4.3% -22.2% 3.5%
Credit Loss Ratio (%)
-0.8% -1.6% -0.5% 0.0% -0.9%
Total Assets
3,237,282,559 444,714,017 67,541,769 81,394,121 3,830,932,466
Total Liabilities
2,982,886,100 409,966,219 62,264,383 75,034,379 3,530,151,081
Other Segment Items:
Depreciation & Amortization
- -
- 10,371,964 10,371,964
Capital Expenditure
- - - 36,970,362 36,970,362
Loans
2,124,807,915 295,041,592 44,809,991 54,000,212 2,518,659,710
No single customer contributed 10% or more to the Banks revenue for both 2016 and 2015.
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
67
29. Financial Instruments Classification Summary
Financial instruments are classified along four recognition principles: held at fair value through profit or loss
(comprising trading and designated), available-for-sale, held-to-maturity and loans and receivables. These
categories of financial instruments have been combined for presentation on the face of the statement of financial
position.
The Bank‟s classification of its principal financial assets and liabilities are summarized below:
Total
Held to maturity Loans & Receivable Carying Fair
at amortized cost at amortized cost Amount Value
Notes GHS GHS GHS GHS
Financial Assets
Cash and cash equivalent 10 - 1,503,415,970 1,503,415,970 1,503,415,970
Trading assets (pledged &non-pledged) 11 949,679,021 - 949,679,021 949,679,021
Loans and Advances 12 - 2,885,538,777 2,885,538,777 2,885,538,777
Other Assets 13 - 229,313,512 229,313,512 229,313,512
Total at 31/12/16 949,679,021 4,618,268,259 5,567,947,280 5,567,947,280
Cash and cash equivalent 10 - 661,408,248 661,408,248 661,408,248
Trading assets (pledged &non-pledged) 11 386,824,156 - 386,824,156 386,824,156
Loans and Advances 12 - 2,475,190,684 2,475,190,684 2,475,190,684
Other Assets 13 - 151,497,508 151,497,508 151,497,508
Total at 31/12/15 386,824,156 3,288,096,440 3,674,920,596 3,674,920,596
Liabilities
Measured at Total
Amortized Carrying Fair
Cost Amount Value
Notes GHS GHS GHS
Financial Liabilities
Deposit from customers 15 2,615,879,033 2,615,879,033 2,615,879,033
Borrowings 16 2,394,179,397 2,394,179,397 2,394,179,397
Other Liabilities 17 246,484,824 246,484,824 246,484,824
Total at 31/12/16 5,256,543,254 5,256,543,254 5,256,543,254
Deposit from customers 15 2,728,142,189 2,728,142,189 2,728,142,189
Borrowings 16 660,519,775 660,519,775 660,519,775
Other Liabilities 17 136,532,247 136,532,247 136,532,247
Total at 31/12/15 3,525,194,211 3,525,194,211 3,525,194,211
uniBank (Ghana) Limited
Notes to the financial statements For the year ended 31st December 2016
68
30. Value Added Statements for the year ended 31 December 2016
2016 2015
GHS GHS
Interest earned and other operating income 1,437,679,277 754,918,343
Direct cost of Services (1,214,716,677) (623,136,304)
Value added by banking services 222,962,600 131,782,039
Non-banking Income 495 -
Impairments (80,247,571) (20,682,177)
Value Added (80,247,076) (20,682,177)
Distributed as follows:
To Employees:-
Directors (without executives) (352,875) (411,225)
Executive directors (3,397,951) (2,789,836)
Other employees (63,037,357) (46,200,328)
To Government:
Income tax (17,713,524) (12,342,631)
To providers of capital:
Dividends to shareholders - -
Depreciation (16,238,647) (10,371,964)
Retained earnings 41,975,170 38,983,878