BY EMEKA EJERE
Redoubled efforts by Ecobank Group have paid off, with the pan African financial institution posting revenue of N641.8 billion for the year ended December 31, 2020, representing nine per cent increase compared with N586.9 recorded in the corresponding period of 2019.
According its audited report submitted to the Nigeria Stock Exchange (NSE) last week, the lender also defied the harsh operating environment that characterized the turbulent year to record impressive performance in other key financial indices.
Further details of the report revealed stable gross earnings of N841.1 billion from N842.5 in 2019. The operating income before impairment losses increased by 20 per cent, from N198.6 billion to N239.1 billion during the year under review. Also, total asset of the bank nudged up to N10.4 trillion in the year ended from N8.6 trillion in the corresponding year of 2019, representing 20 percent increase.
Profit before goodwill impairment, however, went down by 12 percent to N129.1 billion as against N 146.5 billion recorded in the corresponding period of 2019, just like Profit before tax dipped to N66.6 billion from N146.5 billion reported in 2019 while Profit after tax closed at N33.7 billion.
This is a reflection of the power of our pan-African diversified one-bank business model says Ade Ayeyemi, Ecobank Group CEO.
Ayeyemi further said: 2020 was a year which tested the resilience of the human spirit in rising to the many challenges as governments, businesses and households unrelentingly strove to keep citizens, clients and loved ones safe. I am proud of Ecobankers hard work and continued service to our customers and the support we provide to the communities we serve.
Little wonder Ecobank Nigeria bagged Best Retail Bank in Nigeria accolades at the Asian Banker Awards 2020. According to The Asian Banker, organisers of the event, the annual awards are designed to identify emerging best practices in retail financial services, technology implementation and innovation. The annual award also identifies implementation goals and challenges from which other financial institutions and technology companies could learn.
Specifically, the organisers explained that Ecobank was selected as the Best Retail Bank in Nigeria for its deployment of digital solutions to meet the needs of its customers even during the COVID-19 pandemic lockdown, adding that the bank also enhanced its customer experience through culture transformation across the various touch points.
Ecobank encouraged its customers to avoid non-essential contact in achieving their banking needs by utilizing digital solutions to access their account, make contactless payments, transfer funds and carryout other banking transactions from the comfort of their home and offices without visiting the bank, the organisers noted.
In 2019, Ecobank Transnational Incorporated (ETI), the parent company of Ecobank Group, was hosted by the London Stock Exchange to a market opening ceremony to celebrate the successful listing of the Eurobond on the London Stock Exchange (LSE) main market after ETIs successful $500 million Eurobond issuance
The bond, which was oversubscribed with strong demand from international investors in the United Kingdom, United States, Europe, Middle East, Asia and Africa, followed on from Ecobanks 2017 convertible bond issuance on the International Securities Market.
The five-year senior unsecured notes, which mature in April 2024, were launched with a coupon interest rate of 9.50 per cent per annum payable semi-annually in arrears.
Moving into what the bank has called the execution phase of a five year strategic plan which commenced in 2016, the Eurobond Issue with one of the highest coupons for recent emerging market Issues contributed immensely in repositioning the banks balance sheet and increasing its return on equity (ROE) in FY 2019..
Consequently, ETI grew profit by 28 percent in the financial year ended December 31, 2019. While profit before tax rose by 32 percent to N146.544 billion in 2019, up from N110.829 billion recorded a 2018, Profit after tax increased from N77.463 billion in 2018 to N99.461 billion in 2019, representing an increase of 28 percent.
The bank grew total assets by five percent from N8.195 trillion in 2018 to N8.621 trillion in 2019 while liabilities grew from N7.520 trillion to N7.894 trillion in 2019. Its total equity increased by nine percent from N631.132 billion to N687.742 billion, while customers deposits expanded by two percent to N5.924 trillion during the year under review.
But more importantly, that transaction made ETI the first financial institution in Africa to raise a Eurobond as a holding company level, a major milestone for private debt finance in Africa.
This tap issuance was launched as a RegS 5-year USD denominated senior unsecured bond offering. It was oversubscribed by over 4.6 times. The issue price is 104.915 per cent of the principal amount, reflecting a yield of 8.25 per cent, a solid improvement from the yield of 9.75 per cent for the initial issue, ETI had said in a statement.
According to the statement, the proceeds will be used for ETIs general corporate purposes and will further strengthen its liquidity.
It said, The transaction is in line with ETIs strategic objectives and forms part of the proactive management of its balance sheet to diversify funding sources and extend the average debt maturity profile.
Ayeyemi had said, As investor appetite deepens for emerging market offerings, we are positioned to offer the value that global investors seek. Our ability to open Africa to the world makes us a compelling choice.
We appreciate the trust vested in us in continuing to build a strong independent African institution a force for economic development in all of our operating markets.