Ecobank Transnational Incorporated Reports $224m Profit in 9-months

Ecobank Transnational Incorporated (ETI), reported group profits available to shareholders of $224 million for the first nine months of 2023 compared with $196 million in the similar period of 2022.

The 14% year-on-year increase in attributable profits was driven by increased revenues across both net interest income and non-interest revenue, lower expense growth compared to revenue growth, and continued stability in credit quality.

Group profit before tax increased by 12% or 55% at constant currency to $450 million, driven by positive operating leverage (revenue growth higher than expense growth) and despite the exposure to Government of Ghana (GoG) Eurobonds substantially increasing impairment charges on other financial assets and continued hyperinflation in Zimbabwe and South Sudan creating net monetary losses.

Group net revenues (net interest income plus non-interest revenue) for the first nine months of 2023 were $1.518 billion, increasing by 12% or 34% at constant currency.

The increase in revenue was driven by the net impact of higher interest rates, particularly in Anglophone West Africa (AWA) and Nigeria, growth in the volume of interest-earning assets, significantly higher fees from treasury services and solutions, and higher cash management fees. Net revenues were up 7% to $765 million within Corporate and Investment Banking, up 24% to $424 million in Commercial Banking and 10% to $382 million in Consumer Banking.

Jeremy Awori, CEO of Ecobank Group, said: “Ecobank generated profit before tax of $450m for the nine months to September, an increase of 55% in constant currency from the prior year. Moreover, we delivered profits attributable to ETI shareholders of $224m, which translated to a return on tangible shareholders’ equity of 25.6% on the back of a strong revenue growth of 34% in constant currency and an improved cost-to-income ratio of 53.7%. We achieved these results despite the challenging macroeconomic environment, which demonstrates the resilience of our diversified business model.

“I am pleased to announce that we have completed our Growth, Transformation and Returns (GTR) strategy. True customer orientation is the core of our GTR strategy, meaning we will always focus our energies and resources on delivering great products and services. As part of our broad strategic focus areas, we are accelerating the growth of our Consumer and Commercial Banking businesses given the significant revenue opportunities, diversifying and growing our Corporate and Investment Banking revenue streams, and consolidating our achievements, experience and market recognition to scale our Payments, Remittances and Fintech business. Additionally, we will entrench our leadership positions in markets where we are a top three bank, address subscale markets, and provide unwavering support to our Nigerian team as they turn around and further grow their business.”

“We will invest further in technology, in all its forms, to provide better, faster, and easier services to our customers. Furthermore, we are investing in building our brand to create greater connection and support our growth businesses.”

“Ultimately, the foundation for success rests on the passion and dedication of Ecobankers to consistently deliver for clients and customers no matter the environment, unified by our shared cultural and ethical values. Accordingly, we have made it our priority to invest in providing the enabling environment and resources to inspire creativity, innovation and discipline in execution,” Awori added.

Awori concluded: “Our board and management are committed, and Ecobank is positioned for greater success, impact and shareholder returns.”