…An indigenous bank’s transformation signals a new era in Banking
In an exclusive interview with Business & Financial Times (B&FT), CalBank’s Managing Director, Carl Selasi Asem (CSA), outlined an ambitious trajectory for one of Ghana’s leading indigenous banks. His vision exemplifies how homegrown institutions can navigate global economic turbulence and domestic challenges to emerge stronger and more resilient.
Despite the significant impact of developments like the Domestic Debt Exchange Programme (DDEP) and broader macroeconomic difficulties—such as a dramatic overnight surge in exchange rates in late 2022—CalBank has managed a remarkable turnaround. Under Mr. Asem’s leadership, the bank has moved from a staggering loss of GH¢671 million in 2023 to a profit of GH¢223 million by the end of Q3 2024.
This recovery has been driven by a strategic focus on building resilience and superior customer service. The bank’s deposits grew to GH¢10.1 billion at the end of Q3 2024, largely emanating from digital platforms and consisting mostly of retail and SME deposits. The profit outturn was also supported by enhanced recovery efforts, which yielded GH¢712.5 million from non-performing assets.
In this conversation with B&FT’s Bernard Yaw Ashiadey and Joshua Worlasi Amlanu, Mr. Asem highlights the importance of reimagining what it means to be a fully Ghanaian-owned institution. “It’s about proving that indigenous banks can transform into world-class institutions,” he asserts, as he spearheads efforts to restructure the bank’s deposit structure, diversifying from corporate dependency toward retail strength.
He adds that CalBank’s transformation is not just about financial performance but also about driving ethical behavior and excellence in banking. With an aggressive digital transformation agenda and plans to expand the bank’s agency network to 5,000 agent points by 2025, Mr. Asem is committed to creating a legacy of sustainability and innovation. Here, he explains how CalBank is positioning itself as a blueprint for indigenous financial institutions, showcasing that they can thrive in Ghana’s evolving financial landscape while maintaining the highest standards of governance and innovation.
The bank’s financial performance
B&FT: The bank has seen a remarkable turnaround, reporting growth of around 26.1percent and a mid-year increase of approximately 41.8percent. Can you share the story behind this performance?
CSA: The past two years have been exceptionally challenging—not just for CalBank but for the entire banking sector. In late 2022, Ghana’s macroeconomic conditions worsened significantly, with exchange rates surging by nearly 100percent overnight and the onslaught of the Domestic Debt Exchange Programme (DDEP). This sudden shift placed immense pressure on our balance sheet, particularly as we were heavily exposed to Government of Ghana bonds.
We restructured our balance sheet, prioritizing retail banking. By the end of 2023, our deposits rose to GH¢7.3 billion, with significant contributions from retail and SME clients.
Optimising our balance sheet required bold decisions, including increased provisions for non-performing loans (NPLs), which rose to 41percent. Although this resulted in another loss of GH¢671 million in 2023, these measures were necessary to build a solid foundation for recovery. In January 2024, we launched a new five-year strategy focused on retail and SME banking. By Q2 2024, our total deposits reached GH¢8.4 billion, with 63percent coming from SMEs and individuals.
This transition has also reduced our cost of deposits, with 85percent of deposits now coming from current and savings accounts (CASA). This reflects growing customer confidence in our brand and strategy. Our digital transformation efforts have further strengthened our digital footprints. By Q3 2024, our agent banking network had expanded from 600 to about 2000 agents, alongside enhancements in our internet banking and mobile app services all developed in-house by our Ghanaian tech team.
Loan recovery efforts
B&FT: The bank recovered about GH¢712.5 million in Non-Performing Loans. How was this achieved?
CSA: Loan recovery was a critical part of our transformation strategy. Facing financial impairments forced us to adopt a more aggressive approach. We prioritized ensuring that all clients met their repayment obligations. Strategies included enforcing repayment terms, restructuring loans for willing borrowers, liquidation of collateral assets, and pursuing legal actions when necessary. We recovered GH¢505 million in the first half of this year alone, increasing this figure to GH¢712.5 million by Q3 2024. Our target is to recover at least GH¢900 million by year-end.
These efforts have significantly improved our asset quality, though our NPL ratio remains high at 41percent due to a single large exposure. Provisions have already been made for this exposure, and we anticipate a decline in the NPL ratio as recovery efforts continue. Our recovery agenda emphasizes accountability and proactive follow-ups, which will help minimize future NPLs and bolster our financial position. By maintaining a disciplined approach, we aim to set a benchmark for effective recovery strategies in Ghana’s banking sector.
Retail banking
B&FT: What has the journey been like in the bank’s retail banking?
CSA: Retail banking is undoubtedly a challenging sector, it’s not for the faint-hearted. While corporate banking provides quick wins with large balance sheets and immediate income, retail banking requires persistence, patience, and consistent effort. Recognizing this, we made the decision to deepen our focus and significantly invest in our retail banking strategy in 2020.
Over the last few years, we’ve undertaken an aggressive expansion drive. Back in 2009, one of the primary concerns of our customers was the lack of accessible banking channels. We had a limited number of branches and ATMs, which sometimes made it difficult for customers to interact with the bank. By 2016, we responded to this feedback by reevaluating our strategy, scaling up our branch network, and increasing our ATM presence. Simultaneously, we invested heavily in digital banking platforms to create a seamless experience that allowed customers to access services conveniently without always relying on physical branches.
By mid-2021, we began emphasizing the use of our digital platforms. Today, many of our customers regard their phone as their bank. Additionally, we expanded our network of banking agents to provide cash-in and cash-out services closer to our clients, further reducing reliance on branch visits. This shift was not only about growing our physical infrastructure but also enhancing accessibility through digital solutions.
Aligned with our five-year strategy, we aim to lead in digital payments. When payments are accessible, convenient, secure, and robust, customers naturally adopt digital platforms. This strategy has been instrumental in driving deposit growth, as customers prefer maintaining balances with us for ease of transactions. We have also renewed our focus on engaging younger demographics, including university students, as part of our growth agenda. Over the past three to four years, we’ve built a strong team of retail banking experts who have consistently exceeded growth targets by 150–200percent.
While the groundwork for our retail expansion was laid over the past decade, the balance sheet vulnerabilities we faced in 2022 accelerated our plans. Strengthening our retail banking services has become critical in mitigating risks and building a resilient foundation. A diversified portfolio which offers greater stability for the bank’s revenue stream. This is why our focus on retail banking remains central to our strategy.
B&FT: How does the bank’s shift from corporate to retail lending impact your approach?
CSA: Our shift toward lending to SMEs and individuals is deliberate and aligns with our recognition that they are the backbone of Ghana’s economy. Supporting these sectors drives economic growth while diversifying our risk. This approach reduces the risk of a single default significantly impacting our balance sheet. Meanwhile, our aggressive recovery strategy for non-performing loans allows us to redeploy funds into retail and SME lending, supporting a more diversified and resilient portfolio. This strategy is a cornerstone of our broader transformation agenda.
Technology and digital banking
B&FT: How do you view technology and digital banking in shaping CalBank’s competitive advantage?
CSA: Technology is at the heart of our strategy for gaining a competitive edge. Our ambition is to be a leader in digital payments by providing platforms that are seamless, secure, and user-friendly. We will continue to invest in building a robust technological infrastructure to support this vision. Technology is not just a tool; it’s the backbone of our evolution in a competitive industry.
Our customer base growth targets—1 million by the end of 2025 and 2 million within the next 2-3 years—are achievable only through leveraging advanced digital tools and AI-driven solutions to deliver personalized banking experiences. Our dedicated technology team operates with agility and an entrepreneurial mindset, consistently innovating and responding to customer needs. This approach allows us to deploy new solutions faster than many competitors, ensuring we stay ahead in a rapidly changing landscape.
As customers increasingly adopt and rely on digital solutions, the convenience and reliability of our platforms will foster long-term engagement and loyalty, solidifying CalBank’s position as a leader in digital banking.
Agency banking
B&FT: What is the state of the bank’s agency banking efforts?
CSA: Our agency banking network has experienced significant growth. Currently, we have over 2,000 agents operating on our back-end platform, extending our reach far beyond our 38 branches. These agents are instrumental in serving customers in remote areas, offering services through CalBank’s platform. In 2023, we developed a robust, locally tailored agency banking system in-house to replace an externally sourced platform that didn’t fully meet the needs of Ghanaians. This has been a game-changer, allowing us to grow from 600 agents in 2023 to over 2,000 agents today, with a target of 5,000 by the end of next year.
Looking ahead, we plan to expand our network to 30,000 agents within the next five years. Our focus is not just on increasing numbers but ensuring that agents remain active, engaged, and transaction ready. Regular branding initiatives and cohort meetings are part of our strategy to address challenges and improve service quality. Agency banking is critical to our mission of bringing the informal sector into the formal banking system. By expanding financial inclusion, we aim to positively impact both CalBank and the broader economy.
Sector-specific lending
B&FT: Is the bank focusing its lending to specific sectors of the economy?
CSA: While we operate within a defined risk appetite framework, we don’t limit ourselves to specific sectors. Our approach is flexible, adapting to market dynamics and client needs. For example, in sectors like real estate, we provide advisory services to help clients navigate potential risks, such as market crashes, and manage speculative investments. This kind of guidance is invaluable for businesses aiming for sustainable growth, even if it doesn’t directly generate revenue for the bank. Our goal is to meet the unique needs of each sector by offering loans, deposits, and timely support. Sustainability is key; we focus on guiding clients to make informed financial decisions.
Recapitalization
B&FT: What progress has been made regarding the bank’s recapitalization?
CSA: Our existing shareholders have indicated their commitment to recapitalize the bank. We have made quite some progress on concluding the capital raise process. This process should be concluded soon and we shall inform the market accordingly.
Outlook for the last quarter and plans for 2025
B&FT: We’re in the final quarter of the year. What specific plans do you have for 2025?
CSA: 2025 is pivotal for advancing our growth agenda. Our focus will be on expanding asset growth in both the SME and individual banking sectors. At every level of operation, we’ll uphold the core principles of integrity, ethical behavior, transparency, fairness, and accountability. These principles will drive our actions, ensuring exceptional service delivery to our customers while improving efficiency through a cost-conscious approach. Our goal is to generate strong profitability for our stakeholders, particularly our shareholders.
Other matters
MD’s vision and plans
B&FT: What core values guide your vision for CalBank, and how do they align with the bank’s current performance and future direction?
CSA: At CalBank, our core values are responsibility, effectiveness, and decisiveness. These values underpin our commitment to delivering excellent service to our customers and form the foundation of our growth strategy. Reflecting on CalBank’s history, we acknowledge the remarkable work of our predecessors. However, moving forward, our focus is on ensuring that the bank’s organizational structures are robust and sustainable, independent and function to the optimum.
Our priority is to empower our leadership team with the skills and tools necessary to drive decision-making and innovation. By fostering a culture of accountability, we ensure that the bank’s direction is shaped by a collective effort. My focus is to build a peak performing organization through my team. Building sustainable systems means CalBank will thrive regardless of changes in leadership, setting an example for other institutions in Ghana. Our focus is on creating structures that outlast individuals and evolve with each generation of leaders.
Shareholder value
B&FT: How does CalBank’s vision tie into value creation for shareholders?
CSA: Shareholder value remains central to our mission. Integrity remains a cornerstone of our strategy—ensuring all dealings are transparent and accountable. This culture fosters trust among employees, customers, regulators and shareholders. As our financial performance improves, driven by ethical banking practices and a focus on excellence, we are confident in delivering consistent returns to shareholders. Our long-term vision emphasizes sustainability. By building resilient structures, fostering accountability, and maintaining service excellence, we are laying the groundwork for consistent growth, even during turbulent times. This ensures that CalBank remains a trusted and profitable institution for our shareholders.
Final words
B&FT: Any closing thoughts?
CSA: CalBank is a proudly Ghanaian institution, owned and operated by Ghanaians. Our ability to make swift, localized decisions enables us to design products and services that directly address the needs of our fellow citizens. We view CalBank not just as a business but as an integral part of Ghana’s financial landscape. We are on a mission to transform this indigenous institution into one that stands shoulder-to-shoulder with global players, rooted in Ghanaian values and vision.
This transformation is a source of immense pride. It demonstrates the potential of homegrown talent and innovation to propel our institutions forward. The legacy we’re building at CalBank will serve as a testament to the power of Ghanaian ingenuity, resilience and determination, inspiring future generations to take ownership of their destiny and achieve greatness on a global scale.
