CAL bank (CAL) recorded improvement in its financial statements for the first half of 2017 (HY-2017) compared to same period in prior year.
Management of CAL maintained a healthy balance sheet after it recorded huge impairment losses in its FY-2016 financial reports which caused the bottom line to plummet. Supported by superior deposits mobilisation strategy and cutting edge technology employed in its banking operations, CAL recorded a pre-tax profit of GHS 98,415,000 in HY-2017 representing an increase of 4.6% compared to HY-2016. Interest Income rose by 17.65%; from GHS279,179,000 in HY-2016 to GHS 328,467,000. Operating Income equally went up by 13.60% to GHS 220,205,000. Despite Net impairment losses rising by 83.05% over prior year’s record; Profit for the period remained positive increasing by 12.64% in HY-2017.
Net Profit stood at GHS71,489,000 at the end of the 6 months period in 2017 at the same time the bank recorded reduction in cost to income from 41.5% to 39.7%. Earnings per share (EPS) increased by 12.16% over prior year’s level; from GHS 0.1158 to GHS 0.1304 in HY -2017.
Total Assets of the bank grew by 24.94%; from GHS 3,264,745,000 in HY-2016 to GHS 4,079,077,000 in HY-2017. The size of the bank’s loan book decreased marginally during the period by 7% to reflect management’s effort in checking bad loans. Y-o-Y Non Performing Loans (NPL) ratio increased from 6.1% to 12.61% during the period mainly as a result of accumulating debt from the Oil downstream business (i.e. BDCs). Capital Adequacy Ratio (CAR) of the bank fell marginally from 20.7% to 20.3% in HY-2017 even though it remains above the statutory requirement of 10%. Deposits mobilized during the six months period rose by 60.66% to GHS 2,423,242,000 compared to prior year’s level of deposits.
CAL presently records YTD capital gains of 17.33% which is a above the current t-bill rates of 12.55%, 13.05% and 15.00% on the 91-day, 182-day and 1 year note respectively. Improved fundamentals and high liquidity of trade in CAL shares will remain attractive features mostly for retail investors. CAL shares however are very volatile and will continue to trade in a tight price range of +/- 0.01 to +/- 0.03. CAL is recommended as a BUY.
Trading activity on the bourse ended with 7 gainers (CAL, EGH, FML, GOIL, HFC, SCB and SCB PREF) and 2 losers (GCB and GSR) yesterday. ETI shares topped the trading chart in terms of volume as 191,000 shares worth GHS 26,740.00 changed hands. Returns on the Composite and Financial Stock Index pegged at 25.84% and 30.27% respectively.
Trading activity on the Alternative Market was hushed as no shares changed hands on the market.
HORDS currently lead record capital gains on the GAX, appreciating by 25% from 2016 year open.
The Cedi LOST marginally to the Dollar and Euro but GAINED to the British Pound on the inter-bank market yesterday. The local currency exchanged at a mid-rate of GHS 4.3615 to the USD, GHS 5.6976 to the GBP and GHS 50034 to the EURO.
The GCFM Cedi index, a measure of the holistic performance of the Cedi on the inter-bank market now records a year-to-date depreciation of 7.48%.
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