Ecobank profits surge 123%

Ecobank profits surge 123%
Published: 24 April 2018
ECOBANK Zimbabwe Limited has declared an interim $2.3 million dividend for the year ended December 31, 2017 after its profits surged by 123 percent to $22 million compared to $9.9 million in the prior year.

Despite the difficult macro-economic environment that dominated the period, evidenced by negative balance of payments arising from a net trade deficit, the bank remained resilient in creating value for its shareholders.

In a statement accompanying the group's financials for the period, chairman Mr David Whatman, said prospects were more positive for the Pan-African banking group and the Zimbabwean economy at large, this year.

"The bank reported a 123.4 percent increase in profit after tax from $9.9 million in 2016 to $22 million in 2017. This was mainly attributed to a year-on-year increase of 85.1 percent in net interest income added to a 48 percent year-on-year increase in non-interest income," said Mr Whatman.

"The increase in net interest income was due to increased investment in Treasury Bills from $61.1 million at the beginning of the year to $185.2 million at the end of the year. Loans and advances also increased by 18.3 percent year-on-year."

The bank reported that its net non-interest income rose 48 percent year-on-year due to significant trade finance transactions facilitated during the year.

During the period the group grew its asset base by 38.3 percent to reach $546.8 million, reflecting both increased deposits and subsequent asset creation.

Its core capital of $77.3 million reflects year-on-year growth of 34.8 percent and is above the prescribed minimum levels and well ahead of the Reserve bank of Zimbabwe's approved capital plan.

Last year Ecobank accessed lines of credit from its associated group affiliates in excess of $100 million, which were used to facilitate importation of fuel, fertilisers, mining equipment and edible oils.

The bank believes Zimbabwe is poised for growth under the new dispensation led by President Mnangagwa. It lauded the ongoing economic reform processes mainly the indigenisation laws as well as improved production of tobacco, grain and cotton. Zimbabwe's Gross Domestic Production (GDP) growth is expected to clock 4.5 percent this year up from 1.7 percent in 2017, and 0,6 percent recorded in 2016.
- chronicle
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