Ghana's UT Bank has reported substantial increases in bank guarantee and letter of credit (L/C) business.

The microfinance specialist says the increase in such business is substantially due to trade finance support from the International Finance Corporation (IFC), the German Investment and Development Corporation (DEG), and the African Capitalisation Fund (ACF).

Foreign transactions

"The additional trade support line of US$70 million enabled the bank to grant more L/Cs and guarantees," according to UT Bank's CEO, Kofi Amoabeng.

"This further supported growth in our other foreign transactions," he added during the bank's annual general meeting in Accra.

Non-funded income

The Ghanaian bank recorded profit before tax of 26.7 million Ghanaian Cedi (GHS26.7 million - US$13.6 million), representing 54.4 per cent growth in the 2012 financial year compared with the previous year.

Non-funded income - including bank guarantees and L/Cs - increased by 47.4 per cent from GHS29 million to GHS43 million.

More investment

This month it was announced that the IFC, DEG and the ACF had invested US$20 million in UT Bank.

As a result of these investments, DEG owns 13.5 per cent of the microfinance specialist with IFC and ACF each owning a 10.1 per cent stake.

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