2 weeks Ago By Roger A. Agana
News Ghana, Latest Updates and Breaking News of Ghana, Roger A. Agana, https://newsghana.com.
gh/calbank-navigates-profit-growth-and-regulatory-pressures-in-q1-2025/CalBank PLC’s unaudited financial results for the first quarter of 2025 reveal a complex landscape of improved profitability alongside lingering regulatory challenges.The bank reported a net profit of 50.7 million Ghana cedis, a 12% increase from the previous year, driven by cost management and a 34% surge in fees and commission income.
However, declining interest income and persistent capital adequacy concerns underscore ongoing risks in Ghana’s competitive banking sector.Net interest income fell to 79.5 million Ghana cedis, down 35% year-on-year, reflecting tighter margins amid reduced lending activity.
This decline was partially offset by growth in non-interest revenue, including a rise in trading income and fees from services. Total assets expanded by 19% to 11.8 billion Ghana cedis, bolstered by increased cash reserves and investment securities.
Customer deposits grew 23%, signaling strengthened liquidity, though loans to customers dropped 10%, hinting at cautious credit strategies.Regulatory hurdles remain a critical focus. The bank’s capital adequacy ratio deteriorated to 7.
1%, below the central bank’s minimum requirement, while non-performing loans persisted at 45.5%. The Bank of Ghana has deferred penalties for capital shortfalls pending improved profitability, leaving the bank’s compliance timeline uncertain.
CalBank emphasized its risk management framework, citing measures to address credit, liquidity, and operational risks, though analysts note these steps have yet to reverse key metrics.Cash flow challenges emerged as operating activities shifted to a 417.8 million Ghana cedi outflow, attributed to higher impairment losses and reduced trading gains.
Heavy investments in securities further strained liquidity, though borrowings provided temporary relief. Shareholders’ equity rebounded to 268 million Ghana cedis, recovering from prior losses, yet earnings per share dipped slightly to 0.1872 Ghana cedis.
The bank’s pivot toward fee-based revenue and investment securities reflects broader industry trends as Ghanaian lenders adapt to volatile interest environments. Similar institutions have faced pressure to diversify income streams amid economic headwinds. CalBank’s ability to stabilize its capital position while managing asset quality will be pivotal in regaining regulatory confidence and sustaining growth.
For further details, investors can access full financial disclosures on CalBank’s official website or contact its investor relations team. The bank, founded in 1990, operates 28 branches nationwide and manages subsidiaries in asset management and custodial services, positioning itself as a key player in Ghana’s financial sector.As Ghana’s banking industry grapples with macroeconomic instability, CalBank’s performance highlights the delicate balance between profitability and compliance.
Its strategic focus on non-interest income and risk mitigation mirrors regional efforts to fortify financial resilience, though unresolved capital deficits underscore the long road to recovery. News Ghana, Latest Updates and Breaking News of Ghana, Roger A. Agana, https://newsghana.
com.gh/calbank-navigates-profit-growth-and-regulatory-pressures-in-q1-2025/.
