Pan-African financial group, Ecobank Transnational Incorporated (ETI), has reported a 16% year-on-year increase in profit after tax, reaching $333 million in 2024. The audited financial results, submitted to the Nigerian Exchange, highlight key drivers behind this growth, including strong fee and commission income, efficiency improvements, reduced impairment charges on other financial assets, and a lower effective tax rate.
The group’s net revenue—comprising net interest income (NII) and non-interest revenue (NIR)—rose slightly to $2.1 billion. This growth was driven by an expansion in net interest margins, increased investment securities balances, and a rise in net fees and commission income.
Ecobank’s net interest income for 2024 stood at $1.2 billion, reflecting a modest 1% increase. Interest earned on interest-earning assets declined by 1% to $1.9 billion, mainly due to lower income from corporate banking loans and government treasury bills, alongside the impact of exchange rate movements and higher cash reserve ratios (CRR) in Ghana and Nigeria.
Despite this, interest expenses on interest-bearing liabilities fell by 3% to $675 million, attributed to a strategic shift toward lower-cost current account deposits and away from more expensive term deposits. Additionally, operating expenses for the year decreased slightly by 0.4% to $1.1 billion. While inflation and higher costs in communication, technology, advertising, and promotions impacted overall expenses, these were partially offset by reductions in professional fees, operational losses, fines, and AMCON levies.
The group’s cost-to-income ratio improved to 53.0% from 53.9% in 2023. Pre-provision, pre-tax operating profit, a key earnings metric, rose by 3% to $981 million. Income taxes declined to $164 million from $175 million in 2023, benefiting in part from the utilization of deferred tax assets linked to Ghana Eurobond holdings under the ‘Exchange Offer.’ Consequently, the effective tax rate (ETR) dropped to 25.0% from 30.0%.
Gross impairment charges on loans and advances increased to $325 million from $288 million in 2023, primarily due to higher impairment charges on Stage 1 and 2 loans, particularly within Commercial Banking in Ghana and Côte d’Ivoire. Loan recoveries and releases of previously booked impairment reserves amounted to $132 million, a decrease of $11 million from the previous year, resulting in a net impairment charge of $194 million for 2024.
Meanwhile, impairment charges on other financial assets decreased by $54 million to $130 million, reflecting the prior year’s impact of Ghana’s Domestic Debt Exchange Program (DDEP).
Ecobank Group CEO, Jeremy Awori, described 2024 as a pivotal year for the bank’s Growth, Transformation, and Returns (GTR) strategy, highlighting solid business foundations despite macroeconomic challenges such as high inflation, currency depreciation, rising interest rates, and tighter regulations in Ghana, Nigeria, and Zimbabwe.
“Our return on tangible equity (ROTE) reached a record 32.7%, underscoring the strength of our pan-African franchise and disciplined execution. Earnings per share increased by 16%, while tangible book value per share grew by 4%,” Awori stated. “Excluding the adverse impact of foreign exchange rates, we achieved a record profit before tax of $658 million, up 33% year-on-year, while net revenue rose by 18% to $2.1 billion.”
He also emphasized operational efficiencies, noting an improved cost-to-income ratio of 53% and a robust balance sheet. The bank’s deposit base grew by approximately $3.0 billion in constant currency to reach $20.4 billion, driven by a strategic shift toward low-cost current and savings accounts, which improved the CASA ratio to 86.4% and reduced funding costs.
Given economic uncertainties in key markets, Ecobank adopted a more conservative lending approach, strengthening its liquidity position and increasing reserves for expected credit losses. The group’s capital adequacy ratio improved by 80 basis points to 15.8%, staying well above regulatory requirements.
Awori highlighted Ecobank’s diverse footprint across 33 African markets as a key competitive advantage. The bank recorded strong growth in fees and commissions, especially from cross-border payments and trade. It also gained market share in letters of credit and saw a 14% rise in card revenues, supported by investments in digital banking platforms. The active consumer base grew by 9%, with increased product penetration per customer.
“We are sharpening our market focus in each country, accelerating growth in Consumer and Commercial Banking, and expanding our Payments, Remittances, and Fintech capabilities—key pillars of our Seamless Connectivity agenda,” Awori explained.
He also noted ongoing progress in transforming Ecobank’s Nigerian operations: “We continue collaborating with key stakeholders to enhance performance and unlock future potential.”
With these strategic initiatives, Ecobank aims to redefine banking across Africa, connecting customers to opportunities across borders, platforms, and financial ecosystems.
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