The Ecobank Group, to which Ecobank Nigeria belongs, has released its unaudited financial results for 1H’22 ended June 30, posting an increase of 24 per cent in profit before tax to $261.302 million, from $210.073 million in the corresponding period of 2021.
According to the result, submitted to the Nigerian Exchange Limited, profit for the period stood at $185.419 million, an increase of 20 per cent from $154.010 million in the same period of last year.
Net revenues grew by 10 per cent to $910 million as against $825 million in 2021. The increase in revenue was primarily driven by a 13 per cent growth in non-interest revenue and an eight per cent growth in net interest income. In addition, each of our businesses grew revenues, with CIB up 17 per cent, CSB up 11 per cent, and CMB up 10 per cent, “reflecting growing success in our revenue expansion goals stated in our ‘Execution Momentum’ strategy.
“Overall, revenues benefited from rising interest rates, higher spreads on buying and selling currencies for clients, increased card spending, and cash management-related fees,” the institution said.
Commenting on the performance, Ade Ayeyemi, CEO, Ecobank Group said: “Our results for the first six months of 2022 reflect not only the benefits of the firm’s diversification but also our resilience and capabilities to continue serving our clients and customers in a challenging environment and still generate adequate returns responsibly for our shareholders. As a result, we delivered a return on tangible equity of 19.5 per cent, a record, and increased earnings per share for shareholders by 24 per cent year-on-year. In addition, profit before tax increased by 24 per cent to $261 million and by 53 per cent if you adjust the increase for the significant depreciation of some of our critical African currencies to the US dollar.”
Ayeyemi continued: “We performed well because of our investments, including in technology, and Ecobankers’ continued dedication to meet customers’ financial needs, despite a challenging operating environment of high inflation, weakening African currencies, worsening government fiscal balances and lowering economic growth. In our Consumer Banking business, pre-tax profits increased 43 per cent on higher deposit margins, loans, and debit card spending. In Corporate and Investment Banking, profits rose 33 per cent, as we gained share in the letters of the credit market, payment volumes increased by 43 per cent on Omniplus, and FX volumes grew by 25 per cent as client activity rebounded from the pandemic. In addition, an increase in SME activity and growth in the payment business lifted profits in Commercial Banking by 15 per cent.
“Our investments in technology and digital capabilities have contributed to a reduction in our cost-to-serve. Along with revenue growth, the outcome is our record cost-to-income ratio of 56 per cent. In addition, we increased impairment charges to reflect heightened credit risks. More importantly, we have proactively built central impairment reserves of $206 million, which we can deploy in a stressed credit environment. At the same time, our balance sheet remains liquid and adequately capitalised, providing us with the capacity to serve our customers better.
“Our service to our customers and communities, anchored on our vision to advance Africa’s economic development and financial integration, is widely recognised. Recently, Euromoney adjudged Ecobank for 2022 – Africa’s Best Bank, Africa’s Best Digital Bank and Africa’s Best Bank for SMEs. These accolades are a testament to our passion for serving clients and customers and our continued investments in technology, processes, and people. I am extremely proud of my colleague Ecobankers and thank them for their diligence. As always, we are passionately working towards realising our vision and remaining the bank that Africa and friends of Africa trust,” Ayeyemi added.