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Tag: Ecobank

  • Ecobank, Deutsche Bank, expand trade finance pact

    Ecobank Nigeria and Deutsche Bank have signed Memorandum of Understanding (MoU) to expand trade finance relationship.

    Under the arrangement, Deutsche Bank will provide export credit guarantee programme GSM-102 to Ecobank Nigeria. The bank’s offering of a GSM-102 programme will guarantee credit to encourage financing of commercial exports of U.S agricultural products, while providing competitive credit terms to buyers.

    Ecobank Nigeria will use irrevocable dollar denominated letters of credit for the import of eligible agricultural products from the U.S while Deutsche Bank will advise, confirm and negotiate these letters of credit as well as provide post-shipment financing in accordance with the GSM-102 programme regulations.

    Speaking on the deal,  Managing Director, Ecobank Nigeria, Jibril Aku said: “We look forward to expanding our relationship with Deutsche Bank with this GSM-102 programme. Deutsche Bank’s export credit guarantee service will offer a simple and efficient way for our importers to access agricultural products in the U.S and strengthen economic and trade development in the region.”

    Head of Trade Finance, Financial Institutions, Western Europe & Africa, Global Transaction Banking, Deutsche Bank, said: “We are pleased to offer this programme to Ecobank Nigeria.” As a leading provider for GSM-102 business in Africa, and in close coordination with the Commodity Credit Corporation and the U.S Department of Agriculture’s Foreign Agricultural Service, Ecobank Nigeria will benefit from Deutsche Bank’s strong global and US footprint.”

  • Ecobank warns of lower profit as Naira depreciation boosts earnings

    Ecobank warns of lower profit as Naira depreciation boosts earnings

    The management of Ecobank Transnational Incorporated (ETI) Plc has said there were looming headwinds ahead and the profit of the financial services holding group might come in lower than expected.

    Against the background of mixed performance in the third quarter where the group recorded decline in dollar terms but considerable growth in Naira terms, group chief executive officer, Ecobank Transnational Incorporated (ETI) Plc, Mr. Ade Ayeyemi, said the group see further headwinds looming across and profits could come in lower than expected or in the most optimistic scenario flat.

    “We see looming headwinds ahead and as a result expect reported 2015 profits to come in lower than expected, but relatively flat in constant dollars,” Ayeyemi said.

    The Group CEO spoke on the background of the third quarter earnings of the financial services group, which showed declines across the key performance indicators in dollar terms but these were masked by depreciation in Naira, which lifted the figures filed in Nigerian currency with substantial growths.

    The nine-month report for the period ended September 30, 2015 showed that gross earnings, in dollar terms, depreciated by three per cent from $1.65 billion to $1.6 billion. Profit before tax slipped by two per cent from $408.05 million in third quarter 2014 to $398 million in third quarter 2015. Profit after tax dropped by five per cent to $305.67 million as against $322.1 million. Total assets dropped marginally from $23.42 billion to $23.37 billion while deposits dropped by four per cent from $16.84 billion to $16.09 billion. Total equity however rose by 10 per cent from $2.41 billion in third quarter 2014 to $2.65 billion in third quarter 2015.

    When presented in Naira, all the key items showed double-digit growths. Gross earnings grew by 17 per cent from N268.95 billion to N315.83 billion. Profit before tax rose by 18 per cent to N78.67 billion in 2015 as against N66.5 billion recorded in comparable period of 2014. After taxes, net profit for the period grew by 15 per cent from N52.49 billion to N60.42 billion. Total assets rose by 21 per cent to N4.65 trillion in third quarter 2015 compared with N3.84 trillion in third quarter 2014. Deposits also increased from N2.76 trillion to N3.20 trillion, representing an increase of 16 per cent. Total equity funds grew by 34 per cent from N394.28 billion to N528.18 billion.

    Ayeyemi said operating environment in Middle Africa was challenging during the period noting that the decline in pre-tax profit was largely due to adverse currency movements and operational and impairment losses in the third quarter.

    He added that while the financial results were impacted by various factors, the strength of the group’s diversified pan-African business model ensured a balanced outcome.

    “We had decent loan growth in our corporate bank business. And despite a decrease in domestic bank deposits, we increased the share of stable deposits within the deposit mix. With revenue growth challenged in the current environment, we would focus more on cost efficiency and invest in key initiatives in our transaction banking, cards, and ebanking businesses. Also, we are simplifying our operating model to better serve our customers and position the company for long term success,” Ayeyemi said.

    He pointed out that the group closed the third quarter with healthy capital levels with a Tier 1 capital ratio of 20.6% and Total Capital Adequacy ratio of 22.8% under Basel

  • Ecobank unveils four-year agric financing plan

    Ecobank plans to grow its agricultural loan portfolio of N84 billion significantly in the next four years, in line with the Federal Government’s agenda.
    The Country Manager, Agriculture and Export Finance, Ecobank Nigeria, Abel Ajala, who made this known in Lagos, said the plan was part of the bank’s initiative to increase support to the sector.
    According to Ajala, the bank works with Central Bank of Nigeria (CBN) and Bank of Industry (BoI), using intervention funds and other schemes to avail credit facilities at concessionary interest rates and single digit interest rate for CBN/BoI intervention funds. Apart from the bank’s lending to agricultural sector, Ecobank has supported many stakeholders in the sector to obtain BoI loans and various CBN-support facilities for agriculture, such as Commercial Agricultural Credit Scheme (CACS), Nigeria Incentive-based Risk Sharing for Agricultural Lending (NIRSAL) at a single digit interest rate.
    Ecobank has built a robust agriculture and export unit, staffed by professionals to ensure easy risk assessment of loans while adequately providing measures to guarantee that beneficiaries use the funds diligently and pay back as at when due
    He said Ecobank is supporting agriculture both in the production, including agricultural processing, distribution and other areas of the value chain, stressing that the sector is at the centre of transforming the economy.
    “It is part of our deliberate and strategic initiative to increase support to the Agric sector,’’ he said.

  • Court orders Zamfara to pay Ecobank N3.1b debt

    Court orders Zamfara to pay Ecobank N3.1b debt

    The Federal High Court in Lagos on Wednesday ordered the Zamfara State government to pay Ecobank Nigeria Limited N3.1billion.

    Justice Okon Abang directed the Central Bank of Nigeria (CBN), the Ministry of Finance and Accountant-General of the Federation to deduct the sum from money accruable to the state from the Federation Account and remit to the bank.

    The state is also to pay interest on the sum at 30 per cent per annum from March 1, 2013 when the suit was filed, until Wednesday (when judgment was delivered).

    In addition, the state must pay 10 per cent interest on the judgment sum until it is finally liquidated.

    The judge awarded N50,000 to the bank as cost of prosecuting the suit.

    He directed the Attorney-General of Zamfara, it’s finance ministry, Ministry of Finance, Accountant-General, Attorney-General of the Federation and CBN “to ensure the full and effectual compliance with the judgment.”

    Justice Abang held that the sum of N3, 159,017,740.71 was the outstanding indebtedness on a facility of N1.5billion extended to Zamfara State by Oceanic Bank Plc, which was consolidated with Ecobank.

    Ecobank, in its claims, said the state’s Executive Council passed a resolution authorising its finance ministry to accept the loan on Zamfara’s behalf.

    It said the major security for the disbursement of the loan facility was a conditional Irrevocable Standing Payment Order (ISPO) from the state’s Value Added Tax (VAT) account domiciled with First Bank, Gusau Branch.

    Ecobank said the facility suffered a setback when First Bank “stopped the warehousing of state Federation Account Allocation Committee (FAAC) and consequently declined further remittance for the payment of the indebtedness that arose from the subject facility.”

    An agreement was subsequently reached to restructure the debt in November 2010, after which the state “honoured rentals for few months.”

    “However, the rentals till date have not been paid by Zamfara State government despite the fact that same have fallen due,” the bank said.

     

     

     

  • Ecobank advocates regional integration

    THE Managing Director, Ecobank Nigeria Limited, Jibril Aku has said achieving rapid development in Africa requires improved trade relations, share data and harmonise financial services.
    He said “development, harmonisation and integrating of national and regional financial markets, including elimination of barriers and reducing risks affecting the free movement of labour and capital across-borders would fast track development.
    Aku, who was Guest Lecturer at the Hallmark Newspaper’s Public Policy Dialogue in Lagos, expressed optimism that economic realities would force African countries to integrate despite several failed attempts to unite the continent politically. “I am very optimistic it will happen. Economic realities will happen. Economic realities will drive it. If political realities don’t bring it together, Economic realities will drive it,” he said.
    Aku, whose paper was titled: “Regional Integration and Sustainable Development”, said the current degree of African regional integration remains highly superficial. He listed constraints as membership of bilateral organisations; slow ratification of protocols and reluctant implementation of agreed plans; socio-economic policy divergence; limited national and regional capacities; lack of full private sector involvement at both planning and implementation; weak infrastructure; corruption and poor policy support, amongst others as hindrance to Africa’s competitiveness.
    The top banker is optimistic that current global economic trends would force African countries to integrate, stressing that the modest success of pan African bank, that is Ecobank Transnational Incorporated (ETI) should serve as a beacon in African’s path to socio-economic integration.

  • Ecobank, Global Fund, fight Malaria with $3m

    Ecobank, Global Fund, fight Malaria with $3m

    Ecobank and the Global Fund are in financing partnership programme to enable the fight against malaria, tuberculosis (TB) and HIV/AIDS. The programme is designed to strengthen the financial management skills of the scheme implementers in Nigeria, South Sudan and Senegal.

    Ecobank has pledged $3 million towards the scheme.

    During the second phase of the programme, which officially kicked off in Abuja yesterday, six non-governmental organisations (NGOs) which battle TB and HIV/AIDS in Nigeria will receive extensive onsite training over the next 12 weeks.

    Head of HR, and CEO of the Ecobank Foundation, Julie Essiam, said: “This unique partnership demonstrates the commitment of African institutions like Ecobank using their own resources and knowledge to make a significant contribution to the sustainable development across Africa. Aligned to our vision & mission to develop Africa, at Ecobank, we help develop the communities we serve.”

    Technical training will be delivered by Ecobank Nigeria and through the placement of Accounting for International Development (AfID) consultants, who are all members of the Nigerian Diaspora taking time off to volunteer on this specific project.

  • Ecobank ordered to pay Skye Bank N629m APG

    Ecobank ordered to pay Skye Bank N629m APG

    Ecobank Plc has been ordered to make good its obligation under the Advance Payment Guarantee No ENG/PH/GO394A as security for the release of the sum N629 million to Skye Bank Plc.

    This order was handed down by the Bankers Committee which told Ecobank that the terms of the APG “was binding while No. 2 APG was unilateral and not binding. Therefore, it was not enforceable.”

    Skye Bank’s decision to call in the APG, the Bankers Committee noted “was called within its validity period, there is no provision in place for extension of the guarantee.”

    Skye Bank had reported Ecobank to the Bankers Committee claiming that “Ecobank had blatantly refused to hounour its terms under the guarantee as their customer had delivered only 222 generating sets out of the total number leaving a short fall of 532 generating sets valued at N442, 317, 150. 00.  It is therefore apparent that Ecobank Plc was in breach of its obligation and does not desire to remedy the situation.”

    Skye Bank had argued that on November 25, 2010, on the application of its customer, Messrs Teasons Power Product Company Limited, it relied on an Ecobank APG No ENG/PH/GO394A as security for the release of the sum N629, 280, 000.00 to their customer, PA-Simons Fabrications Limited for a sub-contract to supply and install 754 generating sets with installation materials in various local government areas of the country.

    However, Ecobank in its defence had argued that “prior to Skye Bank’s demand for payment, by a letter dated February 3, 2011, Teasons had discharged Ecobank of liabilities up to N200million based on utilisation on the work plan between Teasons and the customer. By the terms of the APG No. 1, “Ecobank’s liability reduced in proportion to the extent of work done.”

    Skye Bank therefore, called on the sub-committee to compel Ecobank Ltd to make good its obligation under the guarantee and refund Skye Bank the sum of N442, 317, 150.00 .

    Ecobank said: “The APG expired on May 24, 2011. “However, prior to the expiration of the APG, Skye bank vide it’s letter dated May 11, 2011 made a demand on Ecobank for payment of the guaranteed sum on the ground of failure of the customer to perform the contract. The customer thereafter formally requested that Ecobank should extend the validity of the APG to accommodate the competition of the contract.

    “Five months after the issuance of the supplemental Guarantee APG No. 2 and silence from Skye Bank on its demand dated May 11, 2011 on APG No. 1 having received APG No. 2, Skye Bank mischievously sought to make a further demand on APG No. 1 by a letter dated November 16, 2011.”

    In response, Ecobank issued its letter dated December 8, 2011 wherein it stated that it was not liable to Skye Bank on the said APG No. 1 as claimed by Skye Bank, as APG No.1  had been superseded by APG No. 2 which expired on June 26, 2011.

    Ecobank argued that “it would appear that Skye Bank forgot to make a demand on APG No. 2 and decided to feign ignorance of APG 2 and sought to revert to APG No. 1 which had ceased to exist.”

    The bank alleged that “Skye Bank’s contention that it did not receive the APG No. 2 since it did not affect and did not seek confirmation as baseless as lack of confirmation by Ecobank did not affect validity of the guarantee, it was just added comfort.”

  • Ecobank, GTBank, Diamond Bank customers get e-payment reward

    Customers of Ecobank Nigeria, GTBank and Diamond Bank emerged the maiden winners in the ongoing Central Bank of Nigeria (CBN) Electronic Payment Incentive Scheme (EPIS).

    The winners who emerged during a raffle draw held in Lagos are Adeyinka Adejuwon, who banks with GTBank and won N100, 000; customer, Julie Chioma Ukwosah , an Ecobank customer won N50,000 cash prize while Jerry Boakye-Mensah who banks with Diamond Bank got a N15,000 cash prize.

    Head, Acquiring Cards and e-Banking Department, Ecobank Nigeria, Funso Oyelohunnu, commended the CBN reward initiative, stressing that it would further encourage the use of e-payment channels.

    She noted that the emergence of Ecobank customer as one of the winners of the draw attest to the efficiency of the Bank’s e-payment channels. “This is a great initiative. As a bank we are glad that one of our customers is one of the winners. This is a further proof that our various e-payment channels are efficient. This is an opportunity to urge both customers and non customers of the bank to make our e-payment channels their choice,” she said.

    Speaking during the redemption of prizes in Lagos for the first three winners, representative of the Banking Payment System Department of the CBN, Isah Abubakar, said the apex bank will keep giving the desired support for the EPIS project. He commended the transparent process used in selecting the winners, noting that the cash-less banking initiative is helping to promote financial inclusion and getting banking to the grassroots. “The CBN is behind the incentive scheme and will support any project that takes banking to the grassroots,” he said.

  • Ecobank profit rises as African lender continues cost cutting

    Ecobank Transnational Inc.’s first-half profit climbed 26 percent as Africa’s most geographically diverse lender maintained its efforts to curb expenses.

    Net income for the six months through June rose to $244 million from $194 million a year earlier, the Lome, Togo-based bank said in a statement published on the Nigerian Stock Exchange website . Revenue was little changed at $1.07 billion.

    “We continued to drive cost efficiencies in our businesses,” Chief Executive Officer Albert Essien said in the statement. Essien steps down in September and will be replaced by Ade Ayeyemi, CEO of Citigroup Inc. in sub-Saharan Africa.

    The pan-African lender has shares traded in Nigeria, Ghana and Ivory Coast and operates in 36 countries in the continent. Its cost-to-income ratio improved to 62.5 percent in the first half from 68.1 percent a year earlier. Total assets dropped 0.4 percent to $23.3 billion.

  • Ecobank to restructure loans to states

    Ecobank said yesterday it was  working on a plan to restructure loans to the  states, after putting almost a third of those loans on  a watch list as the finances of the states grow more precarious.

    The pan-African lender has loaned about N29.4billion ($150 million) to  Nigerian states. Of this amount,N8.820billion ($45 million) was placed on the watch list.

    The bank said it was working on a remedial action proposed by the  Debt Management Office to restructure the debt into a 20-year government bond, it said in a conference call to investors.

    The  36 states are in debt to the tune of 658 billion naira ($3.3 billion) and one way out of the crisis would be for banks to extend the maturity of loans made to them as much as 20 years, one of the state governors has said.