The pan African bank sounds lower profit alarms

The pan-African Ecobank announced today that its parent company, Ecobank Transnational Incorporated (ETI), will report next month materially lower profit for the year ended 2015.

In a statement sent to the Nigerian Stock Exchange, the bank said its lower profit was triggered by a
number of factors:

– The macroeconomic challenges faced by most African economies, lower crude oil prices, depreciating currencies, monetary and fiscal bottlenecks, due to global developments, negatively impacted expected revenue growth. Thus, revenue growth for 2015 will be below our target guidance.

– Also, higher impairment losses on loans were recognised in the last quarter of 2015 across our loan portfolio. Key actions have been implemented to strengthen our credit risk management processes.

”As a result, our revised growth targets communicated during our third quarter 2015 analysts and investor conference call for deposits and loans will not be achieved. We also expect our efficiency and asset quality metrics to be worse than targets.

”Based on the aforementioned, we expect our full year 2015 profit in US dollar terms to be lower than the nine-months to 2015 reported profit.

Ecobank plans to announce its audited financial results for full year 2015 in April.

First Bank Holdings, Diamond Bank and FCMB have similarly issued profit warnings.