Ghana, which is in West Africa is bordered by the Ivory Coast to the west, Burkina Faso to the north, Togo to the east, and the Gulf of Guinea to the south. The country has a population of over 31 million people, with Accra being the capital city.
Ghana has a mixed economy with a combination of free market principles and government intervention. The country’s economy is driven by the services sector, which accounts for around 60% of its Gross Domestic Product (GDP). The industrial sector accounts for around 25% of GDP, while agriculture accounts for approximately 15%. Ghana is rich in natural resources, including gold, diamonds, oil, and cocoa, which are major contributors to its economy. The country is the world’s second-largest producer of cocoa and a significant producer of gold, bauxite, and timber. In the decade to 2021, Ghana’s economy experienced significant growth, with an average annual GDP growth rate of around 6%.
Banking Sector Overview
Ghana’s banking industry consists of 22 commercial banks, with the Bank of Ghana serving as the country’s central monetary authority.
Structurally, the banking market can be classified into three broad segments, the market-leading banks, the local banks, and the international banks. The market-leading banks consist of Ghana Commercial Bank (GCB), Ecobank Ghana, and ABSA Bank Ghana. These three banks hold an aggregate market share of 30% of the total banking market. The local banks consist of five banks, of which Fidelity Bank and CalBank are the largest. The local banks hold an aggregate market share of 26%. The international banks consist of 14 banks, of which the Nigerian banks dominate. The international banks hold an aggregate market share of 44% of the total banking market.
Historical Financial Performance
CalBank’s total assets grew by a compound annual 15% from 2017 to 2021, with an average inflation of 9.9%. The bank has consistently grown its revenue over the years. CalBank has grown its total assets while generating relatively stable RoEs of between 18% – 20%. Overall, CalBank has demonstrated a track record of steady growth in its revenue and total assets, while maintaining a relatively low level of non-performing loans.
CalBank believes that acting responsibly toward its stakeholders is foundational to operating a productive, profitable, and sustainable business. Through its Corporate Social Responsibility (CSR) program, CalBank provides support in education, health, youth and sports, women empowerment, and community infrastructure.
Further to the above, CalBank has contributed toward developmental objectives in the following areas (2022 statistics):
Financial inclusion – CalBank has 573 637 mass retail customers, where loans amounting to GHS 219mn were disbursed, and GHS 2.1bn deposits were held for this sector.
SME/MSME development – The bank has 55 343 clients in this sector, disbursing loans GHS 342mn, and GHS 1bn deposits held.
Female inclusion – CalBank has a tailored product offering for female-owned MSMEs, namely the CalBank ‘Obaapa’ Loan, which has a concessionary interest rate, flexible collateral arrangement, simplified documentation, and swift processing. In 2022 GHS 34.6mn loans were disbursed to women.
Food and agriculture value chain – Whilst only servicing a limited number of food & Agric clients, CalBank wrote loans to GHS 109mn during 2022.
Renewable energy financing – CalBank has made considerable progress in its green finance product initiatives, through offering affordable financing options for renewable energy and energy efficiency projects. The bank financed a solar PV installation with 0.274MW installed capacity and provided investment funding of EUR 3.764mn in 2022, which resulted in a saving of 7.219GWh energy and a reduction of 950.77 tonnes CO2 per annum.