ETI Declares N104.5bn PAT in Q3 2021 Results,(SP:N8.00k)

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Monday, December 06, 2021 / 3:50 PM / By NGX / Header Image Credit: Ecobank 


Ecobank Transnational Incorporated released its Q3 2021 Audited results for the period ended September 30th, 2021.


 Key Highlights

  • Gross earnings grew by 12% to N686.77bn from N614.46bn in the previous quarter.

  • Profit before tax grew by 316.5% to N143.68bn.

  • Profit after tax grew by 916.1% to N104.51bn.

  • Net Assets grew by 8.70% from N811.75bn to N876.33bn.

  • Share Price Currently Stands at N8.00k


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Ecobank Group reports audited results with profit before tax of $352 million for the nine months ended Sept., on net revenue of $1.3 billion. ROTE of 17.9% and TBVPS of 5.52 US cents


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Ade Ayeyemi, Ecobank Group CEO, said: "We reported strong results, reflecting the continued diligence of Ecobankers in putting our customers first and ensuring that we meet their respective needs. For the nine months period up to September 2021, we earned $352 million in pre-tax profit, a 41% increase compared to the prior year and revenues of $1.3 billion, a 4% growth. Hence return on tangible equity increased to 17.9%, and we grew the per-share value of our shareholders' equity by 11% to 5.52 US dollar cents.


"These results also demonstrate the hard work invested in driving efficiency in all our businesses in line with our deliberate focus on driving down our cost-to-serve, sustain improvement in the quality of our credit portfolio, and strengthen liquidity and capital buffers. As a result, our cost-to-income ratio has been declining consistently quarter on quarter, currently 58.3%. In addition, the stock of nonperforming loans as a percentage of loans outstanding is now at 6.9% compared to 9.9% a year ago. At the same time, we are proactively building loan reserves, currently at 91.2% of nonperforming loans, close to our near-term target of 100%. We have boosted the firm's liquidity profile, thanks to growing customer deposits fueled by an acceleration in digital channel adoption, partnerships with Fintechs, Telcos, and businesses in the Payments Ecosystem," Ayeyemi added.


"During the quarter, Arise B.V., a major institutional shareholder of ETI made a $75 million Additional Tier 1 (AT1) investment in the firm. Adding onto the $350 million Tier 2 Sustainability Note ETI successfully issued to investors in June. The AT1 further improves our Tier 1 capital and double leverage ratio and demonstrates stakeholder confidence in our strategy and business prospects," Ayeyemi continued.


"Finally, we continue to invest in new digital and mobile capabilities to enhance customer experience, alongside the investments we are making in our people, processes, and controls, to ensure the continued resilience of our business and service delivery to our clients. I am deeply grateful to all our customers and the Ecobank team for the remarkable job." Ayeyemi concluded


  • Return on assets and tangible equity have improved and were 1.3% and 17.9%, compared with 1.0% and 14.1% for 9M20, respectively (all percentages annualised and normalised).
  • Net revenue increased $52m, or 4%, to $1.3bn, driven by funded income, cash management, trade finance, mobile and online payments, and FICC.
  • Strong revenue growth in the Payments business, up 34% to $140m (11% of total Group revenue).
  • Profit before tax and goodwill of $352m, $102m higher than the previous year, as higher revenue and lower expenses combined to create positive operating leverage and an improvement in the cost-of-risk.
  • Profit available to ETI shareholders of $182m, grew by $215m over the prior period.
  • Cost-to-income ratio (CIR) of 58.3% has been on a downward trajectory on a quarterly basis, benefiting tremendously from our ‘manufacture centrally, distribute locally’ strategy, sustained cost discipline and revenue growth.
  • Customer deposits increased $1.5bn, or 9% year-on-year (YoY), to $18.9bn driven by deepening client relationships, partnerships, and increasing consumption of our digital platforms.
  • Customer loans increased by $334m or 4% YoY, to $8.9bn.
  • The NPL ratio reduced further to 6.9% from 7.6% in 4Q20 and 9.9% in 3Q20.
  • Coverage of NPLs increased further to 91.2% from 74.5% in 4Q20 and 70.1% in 3Q20 towards our goal of a 100% coverage in the near term.
  • Book value per share up 8% YoY to 6.04 cents, and tangible book value per share (TBVPS) up 11% to 5.52 cents.
  • Continue to see strong client adoption of our digital platforms (Omni plus, Omni Lite, EcobankPay, Ecobank App, Xpress Points etc) across all our business lines. Digital transaction values increased 52% YoY to $42bn in 9M 2021.
  • Arise B.V. (major shareholder of ETI) made a $75m Additional Tier 1 (AT1) investment in ETI. The investment improves ETI’s Tier 1 CAR and double leverage.
  • Ecobank recently secured €100m long-term credit facility over 9 years from the European Investment Bank (EIB) to support African businesses, mostly those affected by COVID-19.
  • ETI signed a 3-year loan agreement with a syndicate of Proparco, DEG and Norfund for $60m in October 2021.

 

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