Frank Adu Jnr.

Frank Adu Jnr.

Frank Adu Jnr., Managing Director of CAL Bank, says it will be suicidal for Ghanaian banks not to venture into the country?s upstream petroleum sector.

According to him, Ghana?s economy has forever changed owing to the oil find.

He said all banks must vigorously venture into that sector in order to enjoy the benefits.

?CAL and all other banks must find what it takes to take part in the petroleum sector upstream because this oil sector is going to give us in the next three years a GDP of at least GH?100 billion.

And all of that is going to be contributed by the oil sector.

?You cannot say as the banking sector, we cannot be there. I believe in another three years, it will move to GH?100 billion.

We cannot continue to play on the fringes and let all that business be done in other markets.

So even though I cannot take CAL bank into upstream now, one day we will get there.?

Noting that in the upstream petroleum sector the requirement of Hess, Kosmos and Tullow put together is bigger than the entire balance sheet of the 27 banks operating in the country, he said banks who want to venture into such a sector must tread cautiously.

Commenting on his outfit?s measures to grow deposits, he said: ?We are looking at deepening our product base just to bring in more deposits.

We will introduce more products and run promotions for the retail markets to be able to bring us more deposits.?

Additionally he stated: ?We are thinking about how to get retail deposits because they are cheaper and sustainable.

We have had some success but it is a slow process. Our competitors have been around since a long time.

The compounded average growth rate of our deposits is about 32 percent.

The loan book is growing at a much faster pace. But that loan book growth if broken down, becomes one that is funded by money which we find from overseas.?

CAL Bank intends to have 30 branches by 2015. ?This month we have opened one and we are going to open another one very soon.

By the end of the year, we would have done four. That would take us to 23.?

Commenting on why CAL Bank is not investing in advertisement, Mr. Adu mentioned: ?Those boards are static and expensive. And they give you visibility in one major place but those things cost $20,000 a year.

And $20,000 will give me an ATM which will serve a purpose, deliver a product and generate income. So we converted the advertising billboards into ATMs. So now, you see our presence in ATMs.

Currently we have over 50. By the end of the year, we supposed to have a 100, and another 100 by the end of the planned period.?

On doing business with bulk distribution companies (BDCs), he said CAL Bank was already in the BDC market.

?We have so many filling stations as customers. We are going to take a more significant role in the BDC market because the BDC business has actually changed.

And whereas in the past the BDCs controlled OMCs in terms of supply, the OMCs have now realized that the BDCs cannot sell.

So now they are beginning to integrate which is why now you have 18 BDCs. They have gone to fight off the regulators.

So now, we have to re-engineer our strategy and get OMCs who have BDC licences as our customers. So it is a totally new ball game we are going into now.?

By Samuel Boadi

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