Ecobank Nigeria leads as ETI posts N735.9bn profit in 2024

Lagos, Nigeria – Ecobank Transnational Incorporated (ETI) has announced its 2024 consolidated financial results, showcasing an impressive post-tax profit of N735.9 billion ($494 million), marking a staggering 179% year-on-year (YoY) increase.

The bank’s pre-tax profit more than doubled, reaching N980.7 billion from N376.5 billion in 2023, reflecting robust earnings growth across its operational segments.

In reported currency terms, ETI’s Nigeria segment emerged as the dominant driver of earnings, with post-tax profit soaring 179.3% YoY to N455.7 billion, representing 61.9% of the Group’s total profit.

However, in constant currency terms, Nigeria’s contribution to the Group’s $494 million post-tax profit was only 0.63%, highlighting the impact of currency translation adjustments on the bank’s financial performance.

Beyond profitability, ETI’s gross earnings surged 130.6% YoY to N4.22 trillion, fueled by robust growth in both interest and non-interest income.

A deep dive into the financial results reveals that core operating income remained the key driver of earnings expansion, supported by a strong lending portfolio and increased investment activities.

Interest income continued to be the largest revenue source, accounting for over 65% of gross earnings. This remarkable performance was driven by:

Interest expenses also rose sharply due to the increased cost of deposits and borrowings in a high-interest-rate environment. Customer deposits grew significantly, pushing interest expenses on deposits from N257.2 billion to N559.4 billion, while borrowings nearly tripled to N306 billion.

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Despite these challenges, net interest income remained strong, underscoring ETI’s ability to manage its lending spreads effectively.

Beyond interest income, non-interest revenue played a critical role in boosting profitability. Fees and commissions saw an impressive jump, driven by:

Additionally, trading and foreign exchange gains more than doubled, further strengthening the bank’s non-interest revenue stream. This diversified earnings structure helped cushion the impact of rising costs and bolstered overall profitability.

ETI also achieved significant improvements in cost efficiency. The bank successfully lowered its cost-to-income ratio to 53%, the best in five years, signaling enhanced operational efficiency despite inflationary pressures and increasing expenses.

While Nigeria remained the largest contributor to ETI’s reported earnings, in constant currency terms, its impact was notably reduced due to foreign exchange translation effects. This highlights the broader macroeconomic challenges faced by banks operating in highly volatile currency environments.

ETI’s remarkable profit growth in 2024 was fueled by a combination of higher interest income, increased fee-based earnings, and improved cost management.

However, rising impairment charges and higher borrowing costs remain critical areas of concern moving forward. The bank’s ability to sustain growth while managing these risks will be key to maintaining its impressive financial momentum in the coming years.