CBG grows liquidity ratio by 38%, post NPL less than 1%
Consolidated Bank Ghana (CBG) for the first quarter of 2022, grew its liquidity ratio by 38 percentage points from 59% in Q1 2021 to 97% in Q1 2022.
The growth in the bank’s liquidity ratio is indicative of CBG’s increased capability of settling its short term debt obligations.
Despite recording some deterioration in loan asset quality within the review period, the bank’s non-performing loans (NPL) as a ratio of gross loans stood at 0.73% at end Q1 2022.
This is an increase from the 0.08% NPL posted same period last year.
With a NPL of 0.73%, CBG is probably the bank with the lowest NPL ratio in the country.
The average NPL of the banking industry per the last Monetary Policy Committee (MPC) press briefing by the Central Bank, currently stands at 14.2%.
Regarding Capital Adequacy Ratio (CAR), CBG for the period ended Q1 2022, posted a CAR of 20.08% which is marginally above the 19.14% CAR posted in Q1 2022.
The bank’s current 20.08% CAR is fairly above the Central Bank’s regulatory 13% minimum CAR requirement.
A bank’s Capital Adequacy Ratio (CAR) measures its ability to cover or absorb losses arising from bad loans.
Assets value of the State-owned bank at end-March 2022, stood at GHS 10.4bn, slightly above the GHS 10.08bn total assets value recorded at end-March 2021.
The slight increment in the bank’s total assets value was on the account of an increase in loans and advances made to customers of the bank.
Loans and advances made to customers grew from GHS 933m in Q1 2021 to GHS 1.6bn in Q1 2022.
Liabilities for the review period also increased slightly from GHS 9.4bn in Q1 2021 to GHS 9.6bn in Q1 2022, driven mainly by a rise in borrowed funds by the bank.
Net profit for the first quarter of the year, per the bank’s Q1 2022 financial results amounted to GHS 6.1m, a reduction of some GHS 3.6m when compared to the net profit of GHS 9.7m recorded in Q1 2021.
Peruse details of the financial results below: