CalBank announces its Unaudited Results for the third quarter 2020

CalBank Plc (Ghana Stock Exchange: ‘CAL’) announces its Unaudited Results for the Quarter ended 30th September 2020.

Accra, Ghana – 28th October, 2020.

Highlights of the Group’s Q3-2020 results (y/y) are:

Profit & Loss
• Net Interest Income grew by 5.5% to GHS 396.3m (from GHS 375.5 in Q3 2019)
• Operating Income increased by 11.9% to GHS 495.4m (from GHS 442.7m in Q3 2019)
• Net impairment Loss increased by 22.8% to GHS 71.8m (from GHS 58.4m in Q3 2019)
• Operating expenses increased by 16.1% to GHS 221.0m (from GHS 190.3m in Q3 2019)
• Profit before Income tax increased by 4.5% to GHS 202.6m (from GHS 193.9m in Q3 2019)
• Profit after Income tax increased by 4.0% to GHS 140.8m (from GHS 135.4m in Q3 2019)
• Cost/Income Ratio increased to 44.6% from 43.0% in Q3 2019

Balance Sheet
• Total Assets increased by 5.4% to GHS 7.6b (from GHS 7.2b in Q3 2019)
• Loans & Advances increased by 8.7% to GHS 2.7b (from GHS 2.5b at Q3 2019)
• Total deposits increased by 7.9% to GHS 4.1b (from GHS 3.8b in Q3 2019)
• Borrowings decreased by 6.5% to GHS 2.1b (from GHS 2.3b in Q3 2019)
• Capital Adequacy ratio increased to 20.8% (18.0% in Q3 2019)
• NPL ratio decreased to 9% (10.3% in Q3 2019)

Shareholder Ratios
• ROAA decreased to 2.6% (3.0% in Q3 2019)
• ROAE decreased to 18.4% (21.7% in Q3 2019)
• Price-to-Book ratio decreased to 0.42 (0.64 in Q3 2019)
• EPS increased by 4.0% to GHS 0.30 (GHS 0.29 in Q3 2019)

Operating Environment
The challenging economic environment occasioned by the Covid-19 pandemic has dampened business
activity and increased overall market risk. The second and third quarter of 2020 have seen a decrease
in average interest rates, an uptick in inflation and growth in the fiscal deficit and public sector debt.

Key earnings drivers
Third quarter earnings have been driven by Net Interest Income growing 5.5% over prior year. Loans
and advances increased by 8.7%. However, Fees and Commissions decreased 24.1% following the
inability to close major expected advisory mandates as a result of the pandemic as well as the waiving
of various fees and commissions as part of Covid-19 reliefs. Net trading income grew 164.9% due to
aggressive growth of fixed income trading volumes. Net Operating income increased 10.3% on prior
year despite the challenges in the operating environment.

Operating costs
Operating costs increased by 16.1% in Q3-2020 over prior year driven largely by newly introduced
deposit insurance premiums, the application of IFRS 16 to leases and new head office depreciation.
However, staff costs were contained, growing by 3.6% as management increased its focus on cost
control in the light of the downturn in economic and business conditions.

Capital and Liquidity
The Group continues to operate from a position of strength with resilient capital and liquidity positions.
Our CAR ratio of 20.8% for Q3-2020 remains well ahead of regulatory and internal targets. The
Group’s rapid adaptation of operations, products and services to the “new normal” means we are wellplaced
to support our customers and staff through the Covid-19 crisis.

Asset Quality
The Group anticipated higher levels of credit losses at the onset of the COVID-19 outbreak. The
adverse impact of the pandemic on businesses and consumers has driven additional impairment charges
consequently reducing underlying profitability. Group Net impairment loss increased by 22.8%. However,
NPL ratio dropped from 10.3% in the prior year to 9.0% in Q3-2020.

Philip Owiredu, Chief Executive of CalBank commented: “Despite the heightened market risk,
increased volatility and economic uncertainty, we delivered a resilient performance in Q3-2020,
growing operating income by 10.3% and increasing balance sheet size by 5.4% on prior year. Our capital
adequacy ratio of 20.8% remains well ahead of regulatory and internal targets and liquidity is robust,
both of which are expected to remain stable. We continued to make good progress on our strategy in
the first nine months of the year.
The Covid-19 pandemic and the attendant lockdowns, restrictions on movement and closure of borders
have had impacts on economic activity, both within Ghana and across the rest of the world. The
pandemic has negatively affected business revenues and the economy has contracted. The Government
of Ghana and the Central Bank have implemented various measures aimed at limiting these impacts.
Looking ahead, our primary objective now is safeguarding the health and well-being of our staff,
customers and communities while also protecting the integrity of our balance sheet. Our employees and
customers have been the foundation of our continued success and I thank them all for their loyalty and
commitment through this difficult year.”

For Further Information

CalBank Plc
Dzifa Amegashie (Head, Investor Relations): +233 (0)261 513134 or

Notes to the Editors:
The Bank commenced operations as a local merchant bank in 1990 with the sole aim of providing truly
differentiated world-class banking solutions. CalBank Plc acquired a Universal Banking License in 2004
and in the same year undertook an initial public offer that was 4.5 times oversubscribed.
The operations of the Bank are backed by experienced managers in key functional areas with a combined
experience of over 100 years in banking and finance. The CalBank Plc team provides the required
solutions to clients and is supported by a strong IT platform that has seen the Bank being recognized for
its innovative products in ICT & Electronic Banking since 2007.

Operations and Subsidiaries
CalBank’s growth strategy is to focus on the growing Ghanaian corporate business sector. Since 2006,
the Bank has developed its retail banking operations with specialized products and services to serve the
needs of its growing retail clientele. The Bank currently has two Wholly-owned Operating Subsidiaries.
CalAsset Management Company Limited is licensed as a fund manager and investment advisor by the
Securities & Exchange Commission of Ghana. CalBank Nominees Limited (“CalNominees”) holds and
administers assets as a custodian.

Branch Network
The Bank has embarked on an expansion program and will continue to expand its footprint by increasing
the number of branches throughout the country. Internationally, CalBank PLC benefits from strong
correspondent banks all over the world. This enables us handle all international transactions quickly and

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