For years, non-performing loans (NPLs) have been a defining challenge for Ghana’s banking sector, particularly for indigenous institutions that often lack the capital buffers and recovery infrastructure of their foreign-owned counterparts. CalBank PLC’s first quarter results for 2026 offer a striking departure from that pattern, but they also raise questions about what comes next.
CalBank’s unaudited financial statements for the quarter ended March 31, 2026, show the bank’s NPL ratio falling to 15.1 percent from 45.5 percent a year earlier, while the Capital Adequacy Ratio (CAR) swung from negative 7.1 percent in 2025 to a healthy 17.2 percent, and the liquidity ratio reached 90.7 percent.
The improvement in asset quality was driven by recoveries and regulator-approved write-offs of fully provisioned legacy loans, which continued to cleanse the portfolio. CalBank has stated a target of reaching the Bank of Ghana’s benchmark NPL ratio of 10 percent by the close of 2026.
The turnaround is significant for more than its numbers. High NPLs have historically been a primary driver of regulatory intervention and a source of depositor anxiety in the indigenous banking space. CalBank entered 2026 with the Bank of Ghana having lifted Prompt Corrective Action restrictions following a successful capital raise that restored its balance sheet and reinstate its mandate to support the credit needs of the economy. The quarterly result consolidates that recovery and signals that disciplined credit risk management can reposition a local institution even after deep distress.
The scale of the cleanup is notable. A 30.4 percentage point reduction in the NPL ratio within a single year represents a structural shift, not a marginal improvement. The net impairment gain on financial instruments of GH¢3.4 million for the quarter further reflects a stabilisation in lending quality rather than continued provisioning pressure.
However, a closer reading of the balance sheet introduces an important caveat. Loans and advances to customers declined sharply to GH¢1.15 billion from GH¢2.22 billion a year earlier. A falling NPL ratio becomes considerably easier to sustain when the loan book itself is contracting. Write-offs and recoveries reduce the numerator while a smaller loan portfolio reduces the denominator. The question the market is now asking is whether CalBank can maintain sub-15 percent NPLs as it rebuilds its lending franchise.
Total assets grew to GH¢13.4 billion and customer deposits rose to GH¢10.3 billion, reflecting continued deposit mobilisation and renewed customer confidence. Much of that deposit base has been channelled into investment securities rather than loans, which has supported income growth in a high-yield environment but deferred the harder test of whether the bank’s credit risk culture has genuinely changed.
Group net profit tripled to GH¢106.76 million from GH¢35.58 million in Q1 2025, making it the most emphatic quarterly profit in recent memory for the lender. That profitability creates room to build provisions and absorb risk as lending is selectively re-accelerated. The bank’s stated strategy for 2026 prioritises high-quality obligors and well-collateralised exposures, which suggests management is aware of the tension between growth and asset quality.
CalBank’s Q1 2026 result is a genuine milestone for an indigenous institution that was in severe distress just two years ago. Whether it becomes a sustainable model for local banking recovery, or a temporary artefact of portfolio shrinkage, will depend on how confidently and carefully the bank rebuilds its credit book over the remainder of the year.
