Ecobank records 22% growth in profit in 2020

By InstinctBusiness Apr 1, 2021 0

Despite the impact of covid-19 on the economy, Ecobank Ghana registered an impressive 22% growth in profit for last year.

This is due to a significant increase in interest income during the period.

According to its 2020 Financial Statement, the bank’s Return on Equity- an important profitability indicator for shareholders- also grew by 26.0%.

Ecobank which is Ghana’s biggest bank according to the 2020 PwC Banking Survey benefited tremendously from interest in investments and loans last year as it shot up by 26% yeaar-on-year to GH ¢1.55 billion.

The strong growth in earnings resulted in an increased earnings per share of GH ¢1.69 in December 2020, compared with GH ¢1.40 pesewas a year ago. This means shareholders of the bank will be smiling with additional 29 pesewas gains.

Importantly, the bank was able to reduce its provision for bad debt, from about GH¢215 million in December 2019 to GH¢178 millionlast year.

The balance sheet size stood a little over GH ¢29.3 billion, cementing its position as Ghana’s biggest bank.

It customer deposits grew by 21% to hit GH¢11.3 billion at the end of December 2020.

In terms of stability of the bank, non-performing loans fell to a low 6.20%, lower than the industry average of 15.5%.

Capital Adequacy Ratio-a measurement of a bank’s available capital to its Risk Weighted Assets, was way above the industry average at 19.10% in December 2020, signifying a stronger bank.

Overall, the bank is highly liquid as customers can easily demand for their deposits anytime, any day.

Key Ratios

Return on Average Assets 3.8%

Return on Average Equity 26%

Non Funded Income to Total Income 25.9%

Financial Highlights September 2019 – September 2020

2020 2019

Profit before Tax 543.8m 441.9m 22%

Total Assets 15.8bn 13.19bn 21%

Deposits 11.3bn 9.72bn 21%