This represents an increase of 12.5 per cent in the same period in 2014, which stood at GH₵105,282 million.
The good performance comes amidst a challenging macroeconomic operating environment in the country that has affected the performance of most banks.
According to Mr. Phillip Owiredu, Executive Director of CAL Bank, the profit was driven by consistent growth in its net interest incomes which stood at GH₵175,925 at the end of the third quarter, an increase of 35.5 percent over GH₵129,857 in the same period 2014.
Mr. Owiredu made the statements at CAL Bank’s second turn at the ‘Facts behind the Figures’ series organised by the Ghana Stock Exchange in Accra.
Fees and Commission stood at 49, 234, up from 37, 906 in the previous year, an increase of about 30 percent. Total income was GH₵293,533 million, made up of net trading income of 59,359, a drop of 8.1 percent from the previous year’s figure of 64, 577, and other income of 9,015.
He noted that the drop in net trading income was a result of the volatility in the currency which affected the banking industry, the worst being in June-July 2015 when the currency traded at about 4.2 to the dollar.
He stated however that although there had been consistent growth in net interest income since 2011, the margin dropped to 10.3 percent from 10.9 percent in 2014, while the ratio of its Non-Performing Loans dropped from 8.6 percent to 6.8 percent, although the value did not change much. Credit loss expense also rose by 13.6% from 15,350 in 2014 to 17.440 in 2015.
Mr Owiredu said the bank recognised the challenges that it had with its books and went through it on a quarterly basis to determine which accounts had to be declassified.
He explained that the bank’s primary focus in these challenging times when growth and income was stalling was to maintain the health of its balance sheet and strengthening shareholder value rather than racking up profits, thus its cost of funds increased to 36.5 percent from 31.2 percent the previous year.
He stressed that the bank had performed well in various aspects, including its asset base, loan portfolio, where it had grown its retail book to 84 million. It had also increased its loans to the electricity, gas and water sector to 19 percent from two percent in 2014.
“From all the seven listed banks, only Ecobank and CAL Bank recorded increased earnings for the third quarter of 2015” he noted, adding the UT Bank had reported losses in the period.
Mr. Owiredu stated that CAL Bank would continue to focus on the retail market as well as the corporate sector. It would also continue to invest in its staff in order to maintain its low turnover rate and invest in technology.
Mr. Joseph Ofori-Teiko, General Manager of the bank, said the increase in loans to the electricity, gas and water sector was because it had identified the sector as one with growth potential and had thus deliberately selected businesses with the sector to deal with.
He however noted that the bank was aware of the risks involved in the sector and had taken measures to ensure that the risks are mitigated.
Mr. Kofi Yamoah, Managing Director of the Ghana Stock Exchange, expressed the hope that 2016 would mark the beginning of an improved cycle in the macroeconomic environment in the country that would enable banks to bounce back.
GNA
