Ecobank Tanzania’s first quarter profit rises to Sh3.5 billion

Dar es Salaam. Ecobank Tanzania’s profit before tax for the first quarter of 2024 has risen to Sh3.5 billion, five times more than what was recorded in the corresponding period in 2023.

Speaking to the press over the weekend, Ecobank-Tanzania managing director Dr Charles Asiedu said the results in Q1 were a continuation of the good performance that the bank achieved throughout 2023.

“In the first three months of the year, revenues surged by an impressive 66 percent to nearly Sh10 billion compared to the same period in 2023. This significant growth was driven by increased lending aimed at bolstering Tanzania’s economy, coupled with expanding business volumes, which underscored the strong acceptance of its products by customers,” he explained.

The improvement in profitability levels during this year’s Q1 was attributed to the controlled cost and decreased impairment charge arising from the non-performing loans (NPL) ratio consistently being under 3 percent for the past two years.

“Operating efficiency continued to improve, resulting from widening positive jaws between revenue and cost. Thus, the income ratio trended to less than 60 percent for the first time, compared to 77 percent a year ago,” said Dr Asiedu.

According to the lender, these results reflect increasing customer confidence as deposits grew over the one-year period by 68 percent to Sh313 billion, influencing asset growth of 27 percent to Sh415 billion.

“On the back of strong growth in deposits, we were able to support our client businesses as we grew our loan book by more than Sh65 billion to Sh157 billion from Sh90 billion,” he stated.

On an annual basis, the bank reported a Sh9.59 billion annual profit before tax in 2023, a remarkable feat compared to Sh1.61 billion in 2022.

These achievements also align with the broader success of the Ecobank Group, the pan-African financial services conglomerate.

Despite the challenging operating environment in 2023, the Ecobank Group reported a return on tangible shareholders’ equity of 24.9 percent and increased profit before tax by 8 percent (or 34 percent at constant currency), reaching $581 million.

Data provided by the lender showed that net revenue surpassed the $2 billion mark for the first time since 2015, growing by 11 percent (or 31% at constant currency) to reach $2.1 billion.