CAL Bank says it will adopt strict risk management discipline to mitigate challenges in the business environment and to also sustain its strong financial performance.

Mr Philip Owiredu, Chief Financial Officer, CAL Bank, said in the face of key challenges in the business operating environment, it is important that the bank adheres to strict risk management to be able to identify the early warning signals.

“We will work strictly to our risk appetite to allow us manage market risk, liquidity risk and operational risk,” he said. Mr Owiredu was speaking in Accra on Tuesday when the bank took its turn at the ‘Facts behind the Figures’ programme at the Ghana Stock Exchange.

The bank, he said, would also adopt prudent asset growth to safeguard healthy balance sheet and also focus on key growth sectors with minimal risk such as the energy, telecommunications, mining and services sectors. Besides, the bank would manage its exposure to the real estate sector and the downstream oil sector to ensure profitability and shareholder value.

Mr Owiredu said one of the focuses of the bank is to increase its visibility through the roll out of branches to 25 by the end of the year and grow retail deposits through promotions and to effectively manage foreign exchange assets and liabilities to reduce exchange risk.

He said the bank’s first quarter performance was commendable with total assets and profit after tax growing 33 per cent and 37 per cent respectively over the previous year. The bank’s profitability was further enhanced by well controlled cost as cost to income ratio fell for the third consecutive quarter to 31 per cent.

The bank’s profit growth, Mr. Owiredu said, was driven largely by interest income from loan book growth and strong income from trading. “Our Non- Performing Loans (NPL) increased slightly this quarter rising to 8.1 per cent from 7.9 per cent at the end of 2013,” he said.

He said the bank would continue to rigorously enforce measures to keep our NPLs within the industry Average. CAL has delivered a substantial 45 per cent return on average equity to shareholders.