Magazine article New African

Ecobank Is Leaving the Competition Behind: As Competition in the Banking Sector in Africa Becomes Ever Stiffer, One Bank Is Showing a Clean Pair of Heels to Its Rivals. Ecobank, the Leading Indigenous Regional Banking Group in Africa with Headquarters in Lome, Togo, Is Turning Heads on the West Coast. Baffour Ankomah Reports

Magazine article New African

Ecobank Is Leaving the Competition Behind: As Competition in the Banking Sector in Africa Becomes Ever Stiffer, One Bank Is Showing a Clean Pair of Heels to Its Rivals. Ecobank, the Leading Indigenous Regional Banking Group in Africa with Headquarters in Lome, Togo, Is Turning Heads on the West Coast. Baffour Ankomah Reports

Article excerpt

Ecobank now operates in 13 West and Central African countries. Because of the solid reputation it has built for itself in the last decade, its shares were over-subscribed in a matter of two weeks when it listed on the Ghana stock market this June. The bank, surprise surprise, had to return the money of thousands of the disappointed would-be shareholders.

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"We have again demonstrated our ability to deliver growth and profitability in one of the most diverse and challenging markets in the world," declared a happy Philip Asiodu, the Ecobank chairman, at the bank's annual general meeting (AGM) held in Accra on 23 June. "During 2005," he continued, "we took several important steps to transform Ecobank to ensure a sustainable and balanced growth of our business in the long term."

Having fought a good fight as chairman, Asiodu retired soon after reading his "chairman's report", his place taken by the former Malian prime minister and vice chairman of the Ecobank board, Mande Sidibe.

Asiodu's upbeat remarks were echoed by the bank's CEO, Arnold Ekpe. "Our performance across a wide range of financial metrics was positive. Revenue and profitability grew," he told the well-attended AGM.

The top executives had reason to be joyful. The 2005 annual report shows a banking group moving forward in leaps and bounds. Its total assets in 2005 rose to a handsome US$2.2bn, its net revenues went up 22% to $221.5m, and its profit before tax jumped by the same 22% margin to $74m.

In addition, the bank raised over $160m in 2005 from internal and external sources, thus proving once again its credibility. "We believe that the Ecobank Group's improved capital and financial flexibility makes it well positioned to achieve its long-term strategic objectives," Asiodu enthused.

The improved capital base came through a successful rights issue arising from the listing of the group's two largest affiliates--Ecobank Nigeria and Ecobank Ghana--on the Nigeria and Ghana stock markets respectively. There are plans also to list the group's parent company, Ecobank Transnational Inc (ETI), on the Abidjan stock market in Cote d'Ivoire. These listings, it is hoped, would improve the liquidity of the bank's shares and market value.

"Our strategy of regional banking continues to serve us well and we have over the years been able to demonstrate that we can manage across countries, cultures and markets," said the CEO, Arnold Ekpe. "Our business model of diversification across countries and markets has ensured that we are less vulnerable to single country event risks compared with many of our peers. We have continued to grow through periods of economic and political instability in our region," he added.

The bank's strategy for the future is very ambitious. It wants to be in the top three positions in every country it operates. It is now in 13 countries; that will increase to 18 by the end of 2006, and 25 in the next few years. The broad strategy is to become the dominant bank in "Middle Africa"--a region made up of 44 countries, excluding North Africa and South Africa, with a population of 701 million people and a GDP of over $321bn. This region also has some of the fast growing oil-exporting countries in Africa.

"In building scale," Ekpe told the AGM, "we seek to operate not as a group of banks but as 'one bank', with a common operating standards in all markets in which we operate, taking into account local regulations and market conditions. …

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