Accra, Ghana//-Bayport Savings and loans PLC is cashing in on the corporate bond market of the Ghana Stock Exchange (GSE) following the non-bank financial institution revelation that it raised a whopping amount of GHS150 million in 2023.
The Managing Director of Bayport Savings and loans PLC, Akwasi Aboagye disclosed this when he took his turn at the GSE’s Facts Behind the Figures in Accra organised by the Local bourse for listed companies on the stock exchange.
He said: In 2023, we raised a total of GHS150 million from the bond market. We like to say a very big thank you to the stock exchange for really supporting us in that drive. That was the biggest funding pool for us in the year 2023 to drive our growth.
We supported that with a deposit mobilisation so as the business travels one of the things that we see is not only do we need to restructure funding, but there is also the need to get closer to our communities”.
So, year-on-year (YoY) between 2022 and 2023, we increased our deposit portfolio by 93% and that in itself was just a strategy just to allow us to keep the business going and also improve our brand presence, Mr Aboagye added.
Growth drivers
Throwing more light on the phenomenal performance of the company from 2023 to half-year (H1) 2024, Mr Aboagye attributed it to bond investments and rigours customer deposit mobilisation.
Sustainability
He explained that in terms of the business one of the things that they focused on is sustainability. “So, if you look at the tough macroeconomic environment like ours, we have continuously improved on our risk management and compliance”, the MD explained.
To this end, Mr Aboagye added that towards the end of 2022 going to 2023, the management got ISO certified on cybersecurity. In addition to that feat, they also did a customer certification protection which also demonstrates their “commitment to the right values towards our customers”.
Strategy
In terms of their strategy, he said it remained the same, stressing that they are focused on payroll lending.
Adding that they continue to drive financial inclusion. Mr Aboagye went on to disclose that in 2022, the company disbursed loans to 46,000 customers that increased to almost 60,000 customers in 2023.
This impressive performance according to him was on the back of available liquidity, and they continued to help the teachers in the rural and peri-urban areas and that is where they fundamentally drive their goal.
While “in terms of driving our strategy, digitisation or digitalisation continues to remain key in terms of not only improving our experience with our customers but also help us to manage our cost. So, if you look at our business, despite all the inflationary pressures, our cost has fairly remained stable”.
We continue to digitise the business. I think based on the last conversation that we had we mentioned that we were digitising our back office. As of today, we have been able to implement a full back-office automation where we have been able to process loans enter-to-enter without any human intervention”.
The plan is to improve that going forward so that we continue to not only improve the experience for our customers but also to keep our cost low so that our type of business which is really dependent on the macro continues to deliver results that are comfortable to the market, he said.
Liquidity management
Liquidity management has been key for the Bayport business. “Our main business is the government payroll and we have seen some delays from the Controller. In 2022, there was one month overdue as at the end of 2023 that has increased to two months overdue.
Sometimes this year, the Controller indicated that in the month of June they won’t be able to pay that increased to three. But that has been regularised and we haven’t seen any deterioration in terms of that. But we continue to engage the Controller to make overdue payments and that is really one of the things”.
For the year 2023, Mr Aboagye indicated that they focused on growing the company’s loan book by working with their existing customers, emphasising that their customers are their first priority.
“We focused on women assets growth while managing our net interest margin and then supported some additional government sector workers”.
Challenges
The Managing Director of the Bayport Savings and Loans PLC which is the Ghana subsidiary of Bayport Management Ltd (BML) provides financial solutions to formally and informally employed individuals in Ghana who are unable to access traditional banking services, admitted that the year 2023 was very challenging due to the performance of the Ghanaian struggling economy.
“Our big challenge has been interest expense which is largely due to the business environment. Thankfully, we are reversing that in the year 2024. The business is still on track recovering from the 2023 challenges”, Mr Abogye assured.
Answering questions, the Chief Financial Officer of Bayport Savings and Loans PLC, Ms Dzifa Cofie explained that deposit-taking is now one of their cheap ways of raising funds for the business.
Outlook
The executives at the programme emphasised that their business remains resilient and agile and therefore urged both local and international investors to do business with the company.
They said they would focus on sustainability by growing deposits at a lower cost through digital solutions as well as continue deepening their corporate investors to propel the growth of the business.
Instructively, Bayport Ghana was established in 2003 as a non-bank financial institution and registered with the Bank of Ghana under the PNDC law 328. It is a market leader in payroll lending solutions to the formal sector and a deposit taking institution.
Bayport Ghana is a subsidiary of Bayport Management Limited which owns 99% of the business and is a leading provider of credit to primarily government employees in emerging markets. The remaining 1% is owned by Ghana’s Social Security and National Insurance Trust (SSNIT).
The Group’s other subsidiaries in Africa and South America are in Zambia, Uganda, Tanzania, South Africa, Botswana, Mozambique, Colombia, and Mexico.