Business News of 2014-05-01

Ecobank Ghana shares soar by 48% for 2013

Shareholders of Ecobank Ghana will be paid dividend of 43 Pesewas per share for the 2013 financial year.

It represents 48 percent growth. Shareholders were paid 29 Pesewas per share in 2012. Ecobank earned a record Ghc267.8 million Cedis as profit-before-tax and revenue of Ghc589.7 million.

The bank grew by 44 percent and 40 percent respectively. Ecobank’s share price increased by 111 percent over the last 12 months from Ghc 3.75 to Ghc 7.92.

Ecobank Board Chairman Lionel Van Lare Dosoo attributed the feat to prudent management of interest expense which remained flat in 2013.

Mr. Dosoo said Ecobank will focus on improving the strength of its balance sheet to deliver excellent returns to shareholders.

“Considering the present level of financial sector development and the competitive pressures existing and emerging in Ghana’s financial sector, your bank has consistently focused on building up competencies to meet emerging challenges. The bank will strive towards maintaining mechanisms that will deliver excellent returns to shareholders in terms of share price and dividend,” Dosoo told shareholders at the bank’s annual general meeting on Wednesday.

Some shareholders were however not happy about the jump in Non-Performing Loan ratio to 5.9 percent. But Managing Director of Ecobank Ghana, Samuel Ashitey Adjei, said the figure was well within the industry average of 12.3 percent.

He explained that management needed to increase the ratio following its acquisition of The Trust Bank. He however said the bank is aggressively pursuing the debtors to improve its profitability.

“Ecobank has always had a non-performing loan ratio of 1 Percent. It jumped to 5.6 percent because we were trying to clean our books after the acquisition of the Trust Bank. We did not want to come here and present our profitability report knowing very wee that are some assets we are not sure of. So we made the provisions but it doesn’t mean we have lost the. So we will pursue them and make sure we collect these monies,” he explained.

The bank’s customer loans grew by Ghc 52 percent to 2.1 billion. Deposits also grew by 32percent to Ghc 3.2 billion. Impairment to loans however stood at Ghc55 million at the end of the 2013 financial year.

Source: radioxyzonline
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