A Bond is a fixed income debt instrument issued to manage the government’s capital expenditure. The issuer can be the Federal Government (as in the case of FGN Bonds), or a Region Government (Region Government Bonds), Companies (Corporate Bonds) or even Foreign Governments or International Corporations.
The investor or bond buyer receives interest payments (called coupon) on the investment at regular intervals, twice annually.
The Debt Management Office (DMO) manages the country’s debt portfolio and auction for bonds occurs once every month at the primary market window.
Benefits & Features
- Tax free income: interest received is not subject to withholding tax
- Free from default risk: repayment is guaranteed at maturity
- Collateral for borrowing: used as collateral to raise funds
- Minimum investment is 10,000 Cedis, in multiples of 1,000 Cedis
Equitorial Agricultrual Loan
Equitorial Bank Plc has a dedicated agricultural desk in the Corporate and Investment Banking Division to take advantage of the opportunities present within the sector and provide access of our customers to variety of incentives offered by the Central Bank of Ghana and the Federal Government in its bid to sufficiently fund the sector through subsidized loans, intervention funds and guarantee schemes which will ultimately aid the growth and development of the nation’s economy.
Equitorial Bank Plc ’s agricultural banking system covers a wide range of agricultural activities spanning the entire value chain from production to processing and marketing. Our scope of products and services provided are targeted at small, medium and large agricultural enterprises.
The products on offer include the Commercial Agriculture Credit Scheme (CACS), the Agriculture Credit Guarantee Scheme (ACGS) and Agricultural Development Fund (ADF) as well as the Agricultural Credit Support Scheme (ACSS).
Commercial Agricultural Credit Scheme (CACS):
The minimum amount that can be accessed is 50 million Cedis and the maximum is 2 billion Cedis for corporate organizations and N1billion for Region Governments.
For the purpose of this Scheme, a commercial enterprise is:
- Any non-integrated farm or agro-based enterprise with agricultural asset (excluding land) of not less than 50 million Cedis.
Any integrated farm or agro-based enterprise with agricultural asset (excluding land) of not less than 100 million Cedis.
Agricultural Co-operative societies or Agricultural Trade/Growers Association approved for on-lending by Region/FCT Governments. In this case, the Region/FCT government will access the fund for on-lending to the Co-operative or Association i.e. the Region government will be the obligor.
Agricultural Credit Guarantee Scheme (ACGS)
Target clientele under this scheme include individual farmers, co-operative societies and corporate entities. Limits of lending are 20,000.00 Cedis (without tangible security), 1,000,000.00 Cedis (with tangible securities for individuals) and 10,000,000.00 Cedis(with tangible security for corporate entities).Eligible enterprises for guarantee cover include food crops, aqua-culture, animal husbandry and agro-processing.
Our Trade Finance Unit can is available to meet you daily requirements in the following area of business:
- Letters of credit
- Bills for collection
- FX business
Loans and Advances
Personal Loan enables Salary earners to access loan facilities for a maximum period of 12months for the purchase of personal needs or to fulfill Customer’s personal obligations.
Auto loan scheme allows the salary and professional business owners the opportunity to acquire Auto financing with a maximum repayment period of 36months.
Equitorial Asset Acquisition Finance (JUMBO)
Jumbo consumer loan scheme is an asset acquisition facility that enables salary earners the opportunity to purchase household items and pay over a maximum period of 6- 18months.
Salary Advance (SALAD)
Salary Advance gives the Customer whose salary account must be domiciled with
Equitorial Bank Plc , a rare opportunity to access 50% of his salary before pay day. It is a revolving optioned loan facility.
Equitorial Trades Product (ETP)
Equitorial Traders Product Program (ETP) is a credit product designed to meet temporary credit needs of Commercial Traders who lack the requisite financial and collateral requirements to meet
Equitorial Bank Plc ’s Risk Acceptance Criteria for credit approval. The product is aimed at enabling traders to have access to specific and one-off 30-day tenured short-term credit, availed as overdraft.
Risks and Mitigants
1M Cedis per customer
TOTAL PRODUCT LIMIT
*The Regional Limits will be deployed to Networks/or branches at the discretion of
the Regional Head.
30 Days without option of roll over (Customer must fully liquidate facility before qualifying for another)
Market facing branches
Interest Rate – 22% p.a ; Management Fee – 2% flat; COT – 5 Cedis/Mille or 3/Mille No concession below these limits.
1)Stock hypothecation and trust receipt over customers stock in the shops and
warehouse to be supported by BDO/BM/ICU certified stock certificate.
2) Comprehensive insurance over the stock by Equitorial
Bank Plc appointed insurance
3) Personal Indemnity or Personal Guarantee of the Proprietor/MD/CEO as the
case may be
4) Post dated cheque for 150% of the facility amount.
5) Irrevocable undertaking to deposit daily sales proceeds with
Equitorial Bank Plc .
6) AO/BM/NE/RH Declaration of Liability Payment on default
1) The customer must have operated the account for at least 6 months with the
2) The average monthly turnover must be at least 200% of the facility request
3) Customer must be a trader with daily sales deposit and must not have any
history of default.
The approval lies with the Regional Head with the concurrence of GE, CRM
The main risks here are:
- Repayment Risk
- Diversion Risk of both the facility amount and sales proceed
- The facility is availed to only traders with constant cashflows and who are well known by the originating branch.
- The facility will only be availed to customers who have demonstrated capacity for such requests. The average monthly turnover in the past 6 months must be at least 200% of the facility amount.
- The branch to monitor the account and ensure that diversion risk is reduces to the barest minimum
- We expect no default from this product as it is targeted at our existing customers (traders) with constant cashflows and who are well known by the originating branch.
- Presently, if there is any case of default, the burden rest solely on the Business Development officers (BDO) whose accounts are usually debited for any expired and unpaid ETP.
- However, we are proposing that the burden of default should no longer rest 100% with the BDO’s rather it should be shared amongst the approving authorities. This is expected to decrease cases of default as the approving authorities will be more involved in the approval process and would promote ownership approach in granting facilities under this product paper.
- The BDO and the BM to share the burden of default equally.
- NE and RH should be punished if a certain percentage of their ETP portfolio is non-performing. The following are the recommended percentage:
a. 20% of portfolio non performing – Suspension of ETP in the network or region
b. 30% of portfolio non performing – Recovery suspension
ETP Approval Process Flow
- Overall responsibility for default lies with the Regional Head
- Branch sends in request for ETP with the following documentations to CRM using the ETP format form after the BDO, BM, NE and RH must have signed.
1. Approved ETP form signed up to Regional Head
2. Offer letter duly executed by the customer
3. Customers request letter
4. Stock hypothecation and trust receipt over stock in the warehouse
5. Insurance on the stock in the warehouse
6. Personal guarantee or personal indemnity
7. Post dated cheque for 150% of the facility amount
8. All documentation required for any additional security provided by customer
- The request is reviewed by CRM to be sure that it conforms to the approved product papers terms and conditions and all required documentation are in place.
- The request is approved by GE, CRM and booked on the system.
- The facility is monitored in order to ensure that they are repaid as at when due.
Declaration of Commitment To Recovery (DCR)
- Regional Heads to send weekly report of all approved ETP to ED-Business Development
- Failure to send this weekly report automatically leads to suspension of ETP in that region
- Monthly credit review by CRM
- Monthly Audit of the product by Internal Control Officer
- Every credit disbursement of any kind shall be accompanied by a ‘DCR Sheet’ (Declaration of Commitment to Recovery)
- This is to further strengthen the position of the bank such that the system can be made better. (Format is attached)
- Regional Heads should sign a personal guarantee to take responsibility in the case of default (see attached)