Chris Kay

Ecobank profit drops as struggling African economies hit revenue

Ecobank Transnational Inc., Africa’s most geographically diverse lender, said full-year profit dropped 73 percent after it reported last month that revenue growth would be lower than expected due to a combination of low oil prices as weaker currencies hampered economic performance across the continent.

Profit after tax fell to $107.5 million in the 12 months through December, compared with $394.8 million a year earlier, the Lome, Togo-based lender said in a statement published on the Nigerian Stock Exchange on Wednesday. Revenue declined to $2.1 billion from $2.3 billion in the previous year, while loans and advances to customers were down 9 percent to $11.2 billion.

Ecobank’s main operations are in West Africa, particularly Nigeria, the continent’s biggest oil producer, which has been hurt by the plummeting price of crude and the weakening of the naira. Growth in Nigeria slowed to 2.8 percent last year, the weakest level since 1999 and down from 6.2 percent recorded in 2014. After expanding into more than 30 African countries in the past decade, Ecobank has said it’s time to consolidate its holdings.

– Bloomberg