In a period where falling interest rates are squeezing banks’ earnings, an industry player is making a strong case that the future of banking relevance goes beyond loans and other traditional income-generating activities.
The Managing Director of Calbank PLC, Carl Asiem, says there is a need for banks to reposition themselves in response to the changing macroeconomic landscape in Ghana, where lending margins are tightening and inflation trends are shifting.
Speaking at the Facts Behind the Figures event by the Ghana Stock Exchange, the MD explained that although there is a need for banks to advance credit despite the low interest and lending rate, loans should not be the primary engine of revenue.
He says in the current low-interest-rate environment, that model is under pressure. Lower policy rates typically translate into reduced lending rates, shrinking the income banks earn from loans. He revealed that for CalBank, this reality has triggered a deliberate strategic shift.
Instead, the bank is doubling down on non-funded income. This refers to revenue generated not from lending money, but from services. This includes advisory services to businesses, transaction fees, commissions, and tailored financial support that helps clients manage and grow their operations.
In practical terms, this means a small business might not just walk into a bank for a loan, but also receive guidance on cash flow management, expansion planning, or financial structuring. These are services for which the bank earns fees.
For corporate clients, it could involve structured finance advice, trade facilitation, or treasury services.
“For banks to be relevant, it is not only about giving loans but being relevant by providing the necessary support to our customers and those customers, that support is not only giving them loans, which is laudable, but also the advisory services that we offer. We have always made sure that loans alone do not become our only income revenue generation but the advisory services and the fees and commissions that we also render. So, we always provide that balance to make,” Carl Asiem indicated.
This approach is not new for CalBank, as it has been building quietly in the background. Over the past two years, while the bank deliberately slowed its loan growth due to asset quality challenges, it strengthened its non-funded income streams.
The results are now becoming evident. Non-funded income has consistently accounted for over 40% of total revenue in recent years, rising to 46% in the first quarter of 2026.
According to the bank, this is no accident as it reflects a conscious effort to build a more balanced and resilient business model that does not collapse when lending slows or when interest margins tighten.
“If banks rely on only loans and are not able to provide that non-funded income support that the customers need, that will affect them, and that is why CalBank has deliberately positioned itself to be able to do that very well,” remarked.
He added, “If you see our book today, we see that 46%, but that is what we have done the last two years, sustainable, always operating a non-funded income ratio around 42-43% throughout the last three years.”
At the same time, CalBank is not abandoning its core role of supporting businesses. The bank says it continues to provide working capital support to SMEs, both through direct lending and contingency arrangements.
However, it is doing so alongside advisory and other value-added services, rather than relying on credit alone.
In a banking environment where interest income can no longer be taken for granted, the MD of Calbank says banks that diversify into non-funded income streams, while maintaining strong customer relationships, are more likely to stay profitable and resilient.
