cal bank limited - the vault half-year results presentation for the period ending 30 june 2015 cal...

CAL BANK LIMITED HALF-YEAR 2015 UNAUDITED RESULTS PRESENTATION

HALF-YEAR RESULTS PRESENTATION

for the period ending 30 June 2015

Disclaimer

This report was prepared by CAL to provide background information on the Group. The report is issued for information purposes only, especially with regards to enabling users understand the inherent potential of the business. It is therefore not a solicitation to buy or sell the stock.

The information contained herein is subject to change and neither the bank nor its staff is under any obligation to notify you or make public any announcement with respect to such change.

Users are hereby advised to exercise caution in attempting to rely on this information and carry out further research before reaching conclusions regarding their investment decisions.



Outline

Overview of CAL Bank Limited

Operating Environment

Unaudited Half-Year 2015 Financial Highlights

Review of Unaudited Half-Year 2015 Financial Performance

Strategy and Outlook

Half-Year Performance of Listed Banks

HALF-YEAR 2015 RESULTS PRESENTATION


CAL BANK AT A GLANCE



Management

Mr. Frank Adu Managing Director

Mr. Philip Owiredu Executive Director

Mr. Joseph Ofori-Teiko General Manager

Mr. Charles Amoah Assistant General Manager



CAL Bank Limited

SSNIT 33.2%

ADP I HOLDING 4 27.7%

ICAM 4.9%

MR DANIEL OFORI 2.5%

FRONTAURA 2.2%

FRANK BRAKO ADU, JR

2.1%

CENTUM 2.0%

OTHERS 25.4%

PARTNERS

SHAREHOLDING STRUCTURE THE BANK AT A GLANCE

CAL Bank Limited is an indigenous bank established in

Ghana in 1990, listed on the Ghana Stock Exchange

Focus: corporate banking, asset-backed retail lending,

treasury, corporate finance, asset management,

brokerage

Subsidiaries: 3 wholly owned

Network: ‐ 23 branches, ‐ 97 ATMs, ‐ 21 corresponding banks

Headcount: 752 employees

Issued Shares: 548.26 million

Market cap: GHS 603.10 million

Public Float: 36.74%



OPERATING ENVIRONMENT



Ghana & Banking Sector Scorecard

… challenging

macro environment

that has bottomed

out

GROSS DOMESTIC PRODUCT

INFLATION

POLICY RATE

UPCOMING DEVELOPMENTS

FOREIGN EXCHANGE

Real GDP growth target for 2015: • 3.9% (incl. oil) • 2.7% (non oil)

Maintained at 22.0% at the just ended MPC meeting in July 2015

• Monetary policy rate will be merged with the reverse repo rate in August • Introduction of a 7-day reverse repo instrument in the money market to

offer more flexibility in the liquidity management of banks • BoG and MOFEP have agreed to open the 2-year Note to non-resident

participation • Eurobond issue, syndicated cocoa financing as well as other programmed

inflows in the second half of the year will provide a strong buffer and help sustain stability in the foreign exchange markets

Following a consistent daily sale of USD 20million to the market by the BoG, the Ghana Cedi experienced a sharp appreciation against major currencies at the beginning of July. This seems to have bottomed out at GHS 3.31 and we have seen a slow depreciation over the last few days

Headline inflation moved up from 16.7% in March to 17.0% in June 2015



UNAUDITED HALF-YEAR 2015 FINANCIAL PERFORMANCE



CAL HY 2015 Key Performance Highlights & Metrics

(GHS ‘000) HY 2015 1Q 2015 HY 2014 ΔY/Y

Net Interest Income 111,023 56,171 79,422 39.8%

Net Fees & Commissions 34,037 17,084 26,472 28.6%

Total Income 191,199 94606 139,678 36.9%

Total Operating Expense 67,894 31,493 45,177 50.3%

Profit-After-Tax 78,609 40,519 61,483 27.9%

Loans & Advances 1,581,682 1,466,761 1,148,211 37.8%

Customer Deposits 1,560,208 1,363,060 879,499 77.4%

Total Assets 3,096,354 3,107,484 2,100,922 47.4%

Capital Adequacy Ratio (%) 20.10 22.01 16.2 35.4%

NAV per Share (GHS) 0.77 0.79 0.57 27.9%

EPS (GHS) 0.1434 0.0739 0.1121 16.8%

ROAA (%) 6.1% 6.7% 7.3% (16.8)%

ROAE (%) 41.7% 42.9% 44.7% (6.6)%



Summarized Income Statement HY 2015

(GHS ‘000) HY 2015 1Q 2015 HY 2014 ΔY/Y

Interest Income 217,879 110,712 154,393 41.1%

Interest Expense (106,856) (54,540) (74,971) 42.5%

Net Interest Income 111,023 56,171 79,422 39.8%

Fees and Commission Income 36,714 18,466 27,951 31.4%

Fees and Commission Expense (2,677) (1,383) (1,479) (81.0%)

Net Fees & Commissions 34,037 17,084 26,472 28.6%

Net Trading Income 39,548 17,275 26,878 47.1%

Other Income 6,591 4,075 6,906 (4.6%)

Total Income 191,199 94,606 139,678 36.9%

Credit Loss Expense (11,136) (5,228) (6,789) (64.0%)

Net Operating Income 180,063 89,378 132,889 35.5%

Total Operating Expense (67,894) (31,493) (45,177) 50.3%

Profit Before Tax 112,225 57,884 87,712 27.9%

Income Tax Expense (28,087) (14,546) (21,873) 28.4%

National Fiscal Stabilisation Levy (5,529) (2,876) (4,356) (21.2)%

Profit-After-Tax 78,609 40,519 61,483 27.9%



Summarized Balance Sheet HY 2015

(GHS ‘000) HY 2015 1Q 2015 HY 2014 ΔY/Y

Investments in Government Securities 546,842 895,014 474,476 15.3%

Loans and Advance to Customers 1,581,682 1,466,761 1,148,211 37.8%

Investments in Government Securities 1,496 1,427 1,756 (14.8%)

Property, Plant and Equipment 92,600 84,625 54,859 68.8%

Total Assets 3,096,354 3,107,484 2,100,922 47.4%

Customer Deposit 1,560,208 1,363,060 879,499 77.4%

Borrowings 936,981 1,174,867 803,806 16.6%

Shareholders Equity 434,244 440,514 319,784 35.8%

Total Liabilities and Shareholders Equity 3,096,354 3,107,484 2,100,922 47.4%



Income Analysis 2011-15 Non-interest revenue 2011-15

NET INTEREST INCOME and NET INTEREST MARGIN ANALYSIS NON-FUNDED INCOME

18

.6

31

.2

69

.3

79

.4

11

1.0

8.5

9.5

14.3

10.7 10.6

0

2

4

6

8

10

12

14

16

-

20.0

40.0

60.0

80.0

100.0

120.0

HY11 HY12 HY13 HY14 HY15

GH

S m

illio

ns

NII NIM

60.3% 43.1% 47.7% 43.9% 42.5%

26.7%

46.9%

27.6% 44.6% 49.3%

13.0% 10.0%

24.7%

11.5% 8.2%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

HY 11 HY 12 HY 13 HY 14 HY 15

Net Fees & Commissions Net Trading Income Other Income

11.6m 19.9m 30.9m 60.3m TOTAL 80.2m



Profit Driver

COST-TO-INCOME-RATIO

53.6%

40.6%

35.3%

32.3%

35.5%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

HY 11 HY 12 HY 13 HY 14 HY 15

COST OF FUNDS

9.7% 9.8%

15.7%

14.8% 14.5%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

16.0%

18.0%

HY 11 HY 12 HY 13 HY 14 HY 15



Capital

RETURN ON AVERAGE EQUITY CAPITAL ADEQUACY RATIO

11.5%

19.1%

17.8%

16.2%

22.0%

0.0%

2.5%

5.0%

7.5%

10.0%

12.5%

15.0%

17.5%

20.0%

22.5%

25.0%

HY 11 HY 12 HY 13 HY 14 HY 15

Regulatory Minimum: 10% 13.8%

29.7%

41.9%

44.7%

41.7%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

50.0%

HY11 HY12 HY13 HY14 HY15

ROAE



Growing Asset Base 2011-2015

TOTAL ASSETS TOTAL ASSET MIX

59

9.0

98

2.3

1,2

82

.8

2,1

00

.9

3,0

96

.4

-

500.0

1,000.0

1,500.0

2,000.0

2,500.0

3,000.0

3,500.0

HY 11 HY 12 HY 13 HY 14 HY 15

GH

S M

illio

ns

Cash & Bank Balances

21%

Loans & Advances

55%

Property & Equipment

3%

Investments 19%

Other Assets 2%

HY15

Cash & Bank Balances

8%

Loans & Advances

62%

Property & Equipment

3%

Investments 26%

Other Assets 1%

HY14



Deposit Portfolio 2011-2015

DEPOSIT MIX BY TYPE

49.7% 37.9% 45.3% 49.5% 48.3%

45.3%

56.9%

48.5%

44.0% 46.5%

4.9% 5.2% 6.2% 6.5% 5.2%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

HY 11 HY 12 HY 13 HY 14 HY 15

Current Account Time Deposits Savings Deposits

72.4% 65.9%

70.6% 69.3% 61.3%

27.6% 34.1%

29.4% 30.7% 38.7%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

HY 11 HY 12 HY 13 HY 14 HY 15

Local Currency Foreign Currency

DEPOSIT MIX BY CURRENCY



Branch Expansion & Deposit Growth 2011-2015

18

19

20

20

24

379.3

592.4

742.5

879.5

1,560.2

0

5

10

15

20

25

30

HY 11 HY 12 HY 13 HY 14 HY 15

0.0

200.0

400.0

600.0

800.0

1,000.0

1,200.0

1,400.0

1,600.0

1,800.0

GH

S M

ILLI

ON

S

Branch Network Customer Deposits



Loan Portfolio

Agriculture <1%

Transport, Storage & Communication

3%

Mining & Quarrying

9%

Manufacturing 4%

Miscellaneous 4%

Government 13%

Services 9%

Commerce & Finance

16%

Electricity, Gas & Water 18%

Construction 24%

LOAN DISTRIBUTION BY SECTOR

95.6% 96.6% 96.4% 94.7% 94.4%

4.4% 3.4% 3.6% 5.3% 5.6%

HY 11 HY 12 HY 13 HY 14 HY 15

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

Corporate Retail

LOAN DISTRIBUTION BY CUSTOMER TYPE

Agriculture 2%

Transport, Storage & Communication

3%

Mining & Quarrying

3%

Manufacturing 4%

Miscellaneous 5%

Government 14%

Services 12%

Commerce & Finance

19%

Electricity, Gas & Water 14%

Construction 24%

HY 15

HY 14



Funding Mix

66.8% 66.3% 62.9%

43.9%

53.2%

14.9% 19.2% 19.6%

16.0%

14.8%

18.4% 14.5% 17.5%

40.1% 32.0%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

HY 11 HY 12 HY 13 HY 14 HY 15

Deposits Equity Borrowing



Credit Loss Expense and NPLs

CREDIT LOSS EXPENSE

5.8

2.8

4.4

6.8

11

.1

-

2.0

4.0

6.0

8.0

10.0

12.0

HY 11 HY 12 HY 13 HY 14 HY 15

GH

S M

illio

ns

NON PERFORMING LOANS

41

.1

48

.2

55

.2

86

.6

11

2.4

12.9%

8.1%

6.0% 7.2%

6.9%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

-

20.0

40.0

60.0

80.0

100.0

120.0

HY 11 HY 12 HY 13 HY 14 HY 15

GH

S M

illio

ns



Share Price Chart Jan-Jun 2015

-

0.20

0.40

0.60

0.80

1.00

1.20

1.40

-

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

Volume Traded Price (GHS)

Min Price: GHS 0.95 Max Price: GHS 1.15



Pricing Evolution

PRICE-TO-EARNINGS RATIO¹ PRICE-TO-BOOK RATIO

7.1

9x

2.9

5x

6.0

0x

4.1

3x

3.7

6x

HY 11 HY 12 HY 13 HY 14 HY 15

0.8

7x

0.9

3x

1.9

5x

1.4

9x

1.4

2x

HY 11 HY 12 HY 13 HY 14 HY 15

1. Trailing 12-months



HALF-YEAR PERFORMANCE OF LISTED BANKS



Half-Year 2015 Earnings for listed banks

153.95

118.63

61.48

110.55

48.48

18.84

5.26

195.96

152.32

78.61 72.97

15.70 13.16

(30.65) (50.00)

-

50.00

100.00

150.00

200.00

250.00

EBG GCB CAL SCB HFC SOGEGH UTB

GH

S M

illio

ns

HY 14 HY 15



Half-Year returns of listed banks

43.5%

39.0% 36.9% 36.2% 35.9%

23.4%

7.9% 6.0% 6.6% 5.8% 5.1%

7.2%

3.1% 0.7%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

50.0%

EBG GCB SCB CAL HFC SOGEGH UTB

ROE ROA



Total Asset

5.73

3.58

3.14

2.10

1.43 1.40 1.17

6.84

4.87

3.74

3.10

2.07 1.92

1.43

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

EBG GCB SCB CAL UTB SOGEGH HFC

GH

S B

illio

ns

HY 14 HY 15



Share Price Performance of listed banks

PRICE-TO-EARNINGS RATIO¹ PRICE-TO-BOOK RATIO

3.4

0x

3.5

0x

5.9

0x 6.6

0x 7

.80

x

12

.70

x

0.0

0x

CA L GCB EBG SOGEGH HFC SCB UTB

3.9

x

3.1

x

1.7

x

1.5

x

1.4

x

1.2

x

0.6

x

SCB EBG HFC GCB CA L SOGEGH UTB

1. Trailing 12-months



STRATEGY & OUTLOOK



Strategy & Outlook

People

Technology

Risk Management & Compliance

• Roll-out bespoke training of all staff using dedicated CAL resource Center

• Continue to reward staff performance to retain motivated & high quality personnel

• Deepen cross-training to enhance cost and operational efficiency

• Remain on-track with CAL Head Office project to provide world class , conducive work environment

• Pursue high quality, selective asset growth from target sectors

• Grow non-funded income from International trade , forex , advisory & syndication mandates

• Increase share of wallet across target business sectors (oil & gas, energy & power, services and telecommunications)

• Continue business process automation to boost operating efficiency

• Increase operational ATMs from 97 to 110 by year end 2015

• Enhance IT products to offer additional channel expansion notably:

– VISA/MasterCard POS merchant terminals

– MasterCard/ China Union Pay products

– ATM acquiring on MasterCard

– Issuance of Prepaid Master Cards

– Enhance Visa Platform using VBV

– Acquiring Diners and Discovery on ATMs/POS channels

– Enhance our systems and operations to support our digital banking initiatives.

– Enhanced Internet banking

• Strengthen risk management framework

• Balance market risk exposures while optimising return on risk

• Enhance loan monitoring and early-detection toolkits to ensure quality loan portfolio.

• Maintain low NPL ratio

Retail Banking

Corporate Banking

• Increase branch network to 28- selected locations to increase deposit base

• Launch branchless banking through agencies and outlets

• Concerted drive into new E-business initiatives to boost deposits and increase payment channels e.g.;

- E- ZWICH card enrolment project

- POS Merchant Acquisition on Visa/MasterCard

- Increase our presence in the digital banking space

- E-card School fees collection



THANK YOU Q&A

cal bank limited - the vault half-year results presentation for the period ending 30 june 2015 cal...

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