Banking

S&P Expects Growth in Ecobank’s Profits, 40% Dividend Payout

Published

6 years ago

03/10/2019

By Dipo Olowookere

Globally recognised rating agency, Standard and Poors, has said it foresees the stable operating conditions of Togo-based Ecobank Transnational Incorporated to help it achieve its revenue growth prospects.

In a statement issued recently to announce the affirmation of ‘B-/B’ and ‘B/B’ long- and short-term issuer credit ratings the lender and its Nigerian subsidiary, Ecobank Nigeria Ltd, S&P pointed out that the diverse shareholder structure of the pan-African lender, combined with its strong management team, will ensure the group’s adequate positioning and enable it to benefit from the supportive economic conditions in the West African Economic and Monetary Union (WAEMU), its largest market, improving economic conditions in Ghana, and more stable conditions in Nigeria.

According to the agency, the ratings reflects its view that Ecobank’s strong pan-African footprint and strengthened management and governance will support its profitability going forward, adding that this is balanced against the group’s constrained asset quality indicators and capital position.

“We think its unique pan-African franchise has attracted a stable base of institutional investors, including Nedbank, Qatar National Bank and South Africa-based Public Investment Corporation, which have positively affected the group’s corporate governance and risk management. We believe the International Finance Corporation’s sale of its 14.1% stake to Arise Invest B.V. reflects continued interest from global investors in Ecobank group and will further support the group’s broader business stability,” the statement obtained by Business Post said.

Ecobank group benefits from a sizeable customer base (19 million as at June 30, 2019) and a strong competitive position in its core markets, ranking among the top three banks in 14 of the countries in which it operates. This wide franchise will continue to support the group’s stable and diversified funding base and low cost of funds, which compare favorably with regional peers. The group’s subsidiaries are primarily funded with short-term deposits (88% of the funding base), comprised of retail and nonfinancial corporate current and savings accounts, S&P said.

“We expect loan growth to resume within the next 12 months. This, in conjunction with higher nonoperating revenue and reduced cost of risk compared with prior years, will support earnings growth.

“We expect the bottom line figures to improve, in conjunction with the continued retention of 100% of net profits until 2020, after which we expect a dividend payout of approximately 40% of net profit.

“This will help improve capitalization slightly and should lead to an average risk-adjusted capital (RAC) ratio before diversification of 3.5% in 2019-2021, up from 3.1% at year-end 2018.

“The group’s subsidiaries are all compliant with their respective minimum capital adequacy as prescribed by their respective regulators. More specifically, following the $150 million recapitalization of Ecobank Nigeria in 2018/2019, we note that its capital adequacy ratio has increased to 16.2% as of June 30, 2019.

“We understand the bank’s capitalization requirements currently do not incorporate the additional 1% domestic systemically important bank (D-SIB) buffer above its 10% minimum capital adequacy ratio. We estimate the group has sufficient capital to meet the additional requirement if the Central Bank of Nigeria introduces the measure in 2020,” the statement said.

It stressed that, “The need to inject capital at Ecobank Nigeria, stemming from the naira devaluation, the $250 million effect of International Financial Reporting Standards 9 (IFRS 9), and additional outlays for regulatory compliance, resulted in double leverage increasing to 150% at year-end 2018, from 114% in 2017.”

“We consider this ratio very high, however, we believe that this risk is adequately covered by available foreign currency liquidity of approximately $600 million. We forecast double leverage will reduce to 130% by 2019 and below 120% by 2020, in line with management’s targets, on the back of increased dividends and cash flows from its subsidiaries.

“The outlook on Ecobank Nigeria and ETI is stable, reflecting our expectation that the group’s asset quality and financial performance will gradually improve over the next 12 months. The outlook also incorporates our expectation that the group would maintain adequate liquidity at the holding company level in response to its high double leverage.”

“We would lower our ratings on Ecobank Nigeria if we took a similar rating action on Nigeria (B/Stable/B). We would also lower our ratings if we considered the Nigerian subsidiary less core to the group due to prolonged weaker financial performance.

“We would lower the ratings on ETI if liquidity buffers that mitigate its double leverage significantly diminished.

“An upgrade of ETI would require, in addition to double leverage reducing to more manageable levels below 120%, a significant improvement in its asset quality indicators or a strengthening of its RAC above 7%. We consider an upgrade of ETI not very likely within our forecast horizon.

“An upgrade of Ecobank Nigeria would require a significant strengthening of the group’s asset quality or capitalization and a similar action on Nigeria,” the statement noted.

Banking

Secure IT, StockMed, 18 Others Make Wema Bank Hackaholics 6.0 Top 20 List

Published

19 hours ago

18/12/2025

Modupe Gbadeyanka

By Modupe Gbadeyanka

The six edition of the Hackaholics of Wema Bank Plc has produced 20 top finalists shared equally between two streams, Ideathon and Hackathon.

The Hackathon finalists are Rapid DEV, Secure IT, Neurafeed, Trust Lock Babcock, Pulse Track, IlluminiTrust, Trust Lock FUTA, Fix Fraud AI, KASH Flow and VOC AI.

The Ideathon finalists include PLOY, Fertitude, VarsityScape, Mama ALERT, StockMed, Chao, All Arbitrate, FarmSlate, Sane AI and Cycle X.

They emerged after a two-day pre-pitch held on December 16 and 17, 2025, for the grand finale slated for Friday, December 19, 2025.

They grand finale of Hackaholics 6.0 will convene the top players in Africa’s tech and innovation ecosystem, creating an avenue for these finalists to not only put their creativity to the ultimate test but also give their solutions visibility to potential investors for additional funding opportunities beyond the prizes to be won.

The prizes to be won for the Ideathon include N25 million for the winner, N20 million for the first runner-up, N15 million for the second runner-up and N5 million each for two women-led teams.

In the Hackathon category, the first to fourth-place winners will receive N20 million, N15 million, N10 million and N5 million, respectively.

The pre-pitch saw the top 43 contenders battle in a game of innovation and problem solving, presenting compelling pitches for a chance to make it to top 10 in their respective streams.

After a rigorous stretch of pitches and presentations, the top 20 emerged, securing their spot in the grand finale of Hackaholics 6.0.

“Hackaholics started off as a hackathon and morphed into an ideation. For Hackaholics 6.0, the sixth edition, we decided to give both the builders of new solutions and the refiners of existing ones, an opportunity to make meaningful impact.

“For us at Wema Bank, we understand that innovation isn’t just building from scratch. Sometimes, it’s looking at what exists and developing new ways to optimise that and create more efficiency. This is the idea behind our two-stream Ideathon-Hackathon structure.

“Every year, Hackaholics shows us just how eager and motivated Nigerian youth are when it comes to exploring creativity and innovation, and we are honoured to be the institution that provides them with the platform and resources to put this drive to good use.

“We toured seven cities, indulged 1,460 participants and discovered hundreds of remarkable ideas; some of which needed some refining and some of which deserved to move to the next stage.

“For those who needed to go back to the drawing board, we provided useful guidance and for the top contenders, we were able to shortlist to the top 43, who proceeded to the pre-pitch. To every participant, Wema Bank is proud of you. This is just the beginning,” the chief executive of Wema Bank, Mr Moruf Oseni, said.

Banking

Customs to Penalise Banks for Delayed Revenue Remittance

Published

1 day ago

18/12/2025

Adedapo Adesanya

By Adedapo Adesanya

The Nigeria Customs Service (NCS) says it will enforce penalties against designated banks that delay the remittance of customs revenue, in a move aimed at strengthening transparency and safeguarding government earnings.

This was disclosed in a statement on the NCS official account on X, formerly known as Twitter and signed by its spokesman, Mr Abdullahi Maiwada, who said the delays undermine the efficiency, transparency, and integrity of government revenue administration.

“The Nigeria Customs Service has noted instances of delayed remittance of customs revenue by some designated banks following reconciliation of collections processed through the B’odogwu platform,” the statement read.

“Such delays constitute a breach of remittance obligations and negatively impact the efficiency, transparency, and integrity of government revenue administration.

“In line with the provisions of the Service Level Agreement executed between the Nigeria Customs Service and designated banks, the Service hereby notifies stakeholders of the commencement of enforcement actions against banks found to be in default of agreed remittance timelines.”

Mr Maiwada disclosed that any bank that fails to remit collected Customs revenue within the prescribed timeline will be liable to penalty interest calculated at three per cent above the prevailing Nigerian Interbank Offered Rate for the period of the delay.

He added that affected banks would be formally notified of the delayed amounts, the applicable penalty, and the deadline for settlement.

“Accordingly, any designated bank that fails to remit collected Customs revenue within the prescribed period shall be liable to penalty interest calculated at three per cent above the prevailing Nigerian Interbank Offered Rate for the duration of the delay.

“Affected banks will receive formal notifications indicating the delayed amount, applicable penalty, and the timeline for settlement,” the statement read.

Banking

First Bank Deputy MD Sells Off 11.8m First Holdco Shares Worth N366.9m

Published

1 day ago

18/12/2025

Aduragbemi Omiyale

By Aduragbemi Omiyale

The deputy managing director of First Bank of Nigeria (FBN) Limited, Mr Ini Ebong, has offloaded some shares of FBN Holdings Plc, the parent firm of the banking institution.

A regulatory notice from the Nigerian Exchange (NGX) Limited confirmed the development on Thursday.

It was disclosed that the transaction occurred on Friday, December 12, 2025, on the floor of the stock exchange.

The sale involved about 11.8 million shares, precisely 11,783,333 units traded at N31.14 per share, amounting to about N366.9 million.

Mr Ebong, who studied Architecture from University of Ife and obtained Bachelor and Master of Science degrees, became the DMD of First Bank in June 2024. Prior to this appointment, he was Executive Director, Treasury and International Banking since January 2022.

He was previously the Group Executive, Treasury and International Banking, a position he held since 2016 after serving as the bank’s Treasurer from 2011 to 2016.

Before joining First Bank, he was the Head of African Fixed Income and Local Markets Trading, Renaissance Securities Nigeria Limited, the Nigerian registered subsidiary of Renaissance Capital. He also worked with Citigroup for 14 years as Country Treasurer and Sales and Trading Business Head.

He has a passion for market development and has worked actively to drive change and internationalisation of the Nigerian financial markets: foreign exchange, fixed income and securities.

He has worked closely with regulatory bodies such as the Central Bank of Nigeria (CBN) and the Debt Management Office (DMO) in assisting with the development of fresh monetary and foreign exchange policies, to broaden and deepen markets and open them up to international practices.

At various times he has facilitated and delivered courses and seminars on a wide variety of subjects covering Money Markets, Securities and Foreign exchange trading and market risk management subjects to regulators, corporate customers, banks and market participants.