CalBank (GSE: CAL) has reported a stellar third quarter for 2024, showcasing a remarkable 97.4% increase in fee income, a 26.5% surge in deposits, and a robust post-tax profit of GHS223.9 million.

With a clear focus on digital expansion, disciplined cost control, and strategic deposit growth, CalBank is on track for continued success.

Earnings: Big Gains and Strategic Adjustments

CalBank’s CEO, Carl Asem, highlighted the bank’s Q3 results as a balanced mix of growth and intentional adjustments.

While fees and commissions jumped an impressive 97.4% year-on-year, net interest income took a 24.7% dip.

This was due to a strategic slowdown in new loan disbursements amid rising interest rates, leading to a 9.8% drop in overall operating income from last year.

Recoveries Strengthen Financial Health

The bank has shown remarkable success in loan recoveries, bringing in GHS712.5 million from previously impaired loans this year.

This achievement is largely attributed to robust recovery efforts within sectors like hospitality, construction, and services, backed by legal action and collateral liquidation to recover funds.

Cost Management: Staying Ahead of Inflation

Despite economic challenges such as inflation and currency depreciation, CalBank kept operating expenses under control with a modest increase of 9.3%.

Staff costs rose by 9.7%, demonstrating the bank’s careful cost management strategy in turbulent economic times.

Profit and Deposit Growth Drive Strong Quarter

One of the most significant highlights of Q3 was CalBank’s after-tax profit, which rose to GHS223.9 million—a 26.1% year-on-year increase and a 41.8% jump from its mid-year earnings. Deposits grew by 26.5%, reaching GHS10.1 billion, up from GHS7.5 billion last year, thanks to a strong retail strategy that continues to attract individuals and SMEs.

The Current and Savings Account (CASA) component now makes up over 80% of total deposits.

Digital Banking Leads Deposit Growth

CalBank’s impressive deposit expansion can be attributed to its digital transformation efforts. With an enhanced agent network and optimized digital channels, more customers are using CalBank’s mobile and online platforms, which have become known for their reliability and security.

Growth Strategy and Digital Expansion

CalBank’s five-year plan prioritizes digital expansion and a focus on SME support.

In Q3 alone, the bank registered 996 new agents, bringing the total to 1,886 agents across all 16 regions.

By year-end, the bank aims to further strengthen its digital presence, positioning itself as a leader in digital payments in Ghana.

Commitment to SME Support and Risk Management

With a focus on SME lending and low-cost accounts, CalBank’s deposit strategy is geared towards sustainable growth and community development.

The bank emphasizes risk management and resilience to drive financial strength and long-term stability.

Leadership’s Take on CalBank’s Future

Reflecting on the Q3 results, CEO Carl Asem praised the bank’s resilience and applauded the dedication of management and the board in driving CalBank’s positive trajectory. "Our Q3 results are a testament to CalBank’s resilience,” he remarked, thanking the leadership team for their vision and hard work.

Board Chairman Joseph Mensah shared in the optimism, highlighting CalBank’s strong fundamentals.

“The bank’s fundamentals are stronger than ever.

We’re poised for success,” he stated, underscoring CalBank’s restructuring efforts and growth momentum.

As CalBank continues its digital expansion and SME support, it stands well-positioned for sustained growth and influence in Ghana’s banking sector.