Lomé, Togo 25 October 2017

Transcription

1 NEWS RELEASE Lomé, Togo 25 October 2017 ECOBANK REPORTS 9MTHS 2017 PROFIT BEFORE TAX OF $227 MILLION The Group delivered a return on tangible equity of 15.6% on profit before tax of $227 million, reflecting solid pre-impairment income growth; Revenue of $1.4 billion, increased 4% in constant currency highlighting the successful rebalancing of the Group s revenue streams ROE: 13.3% EPS: 0.65 $ cents Cost-to-income: 61.7% Basel I Tier I CAR: ROTE 1 : 15.6% TBVPS: 7.08 $ cents NIR ratio 2 : 47.7% 23.7% Ade Ayeyemi, Group CEO said, Our results reflected the benefits of diversification and the progress made in executing our strategy to positioning the company for long-term growth. Actions we took around reducing costs have shown positive results and were evident in improvements to the cost-to-income ratio for the Group, and particularly for Nigeria. We expect further efficiency gains to come from ongoing right-sizing of our Central, Eastern, and Southern Africa region and subsequently the rest of our West Africa regions. Our commitment to creating a digital bank is progressing strongly. The number of mobile app downloads, merchant acquisitions, and merchant processing volumes have increased. Ecobank OMNI and Bank Collect, both digital cash management solutions for our commercial and corporate clients, are making it easier for them to efficiently pay and receive cash. With the operating environment still subdued, albeit showing signs of recovery, asset quality indicators remain high and will stay at these levels for a few more quarters. In response, we have reduced lending activity, continued to strengthen risk management processes, and are engaging constructively with our customers to make good on their past-due loan payments. Overall, we remain optimistic and dedicated to serving our customers with the financial services solutions they need. Profit before tax of $227m, down 19% in constant currency, driven by provision building Revenue of $1.4bn, up 4% in constant currency Expenses of $834m, down 3% in constant currency, despite restructuring costs of $9.3m Cost-to-income ratio improved to 61.7% from 65.5% in Sept 2016 Pre-impairment income 3 of $519m, up 17% in constant currency, driven by costs reduction Net customer loans of $9.3bn, down 7% in constant currency, due to deliberate strategy to reduce lending activity Customer deposits of $14.1bn, increased 1% in constant currency; up 7% excluding Nigeria Francophone, and Anglophone, West Africa continue to deliver strong ROEs; 23.6% and 24.4%, respectively >1.1m Mobile App downloads 53K merchants on-boarded on Masterpass QR, and mvisa QR, merchants Strong client activity in Trade business in UEMOA and Nigeria, benefited from improving FX situation FICC revenues up 38% on strong FX sales $18m recovered through Resolution Vehicle $400m convertible debt issuance completed Successful IPO of Ecobank Côte d Ivoire raising XOF45bn ($80m) at 2.8x book value on offers of XOF108bn 1 ROTE is computed by dividing the Group s profit after tax annualised by the average end-of-period tangible equity. Tangible equity represents the Group s total equity less intangible assets including goodwill 2 NIR ratio depicts the proportion of net revenue generated from non-capital intensive sources 3 Pre-impairment income, is computed as net revenue minus total operating expenses, a financial measure that allows investors to gauge the Group s ability to generate capital to improve our loss absorption capacity

2 ECOBANK GROUP FINANCIAL PERFORMANCE SUMMARY Ecobank reported net revenue of $1.4 billion, an increase of 4% in constant currency from the prior year period, driven by higher non-interest revenue. Profit before tax of $227 million, however, decreased 19% in constant currency, primarily driven by provision building. Comparisons noted in the commentary below are calculated for the first nine months of 2017 versus the first nine months of 2016, unless otherwise specified. GROUP In Constant $ Nine months ended 30 Sept (in millions of $) YoY 2017 Net interest income (15%) 782 Non-interest revenue % 698 Net revenue 1,353 1,426 (5%) 1,480 Operating expenses (11%) 905 Pre-impairment income % 575 Impairment losses % 339 Profit before tax (19%) 227 Tax expense (41%) Profit for the period from continuing operations (13%) Profit/(Loss) from discontinued operations 0.6 (2.0) n.a Profit after tax (12%) 186 Profit attributable to ETI (9%) Basic EPS ($ cents) Diluted EPS ($ cents) Return on average total assets (ROAA) 1 1.2% 1.3% Retun on average total equity (ROAE) % 12.6% Return on tangible equity (ROTE) % 14.7% Net interest margin (NIM) 6.2% 6.8% Cost-to-income ratio (CIR) 61.7% 65.5% 30 Sept 31 Dec 30 Sept Exchange rates of key curriencies vs $ Average FX rates: Nigerian Naira (NGN) Francophone CFA Ghana Cedi (GHS) N o te : Selected income statement lines only and totals may not sum up. (1) ROAA is calculated as the Group's profit after tax divided by average end-of-period total assets (2) ROAE calcuated as the Group's profit after tax divided by average end-of-period total equity (3) Return on tangible equity (ROTE) is computed by dividing the Group's profit after tax by the average applicable endof-period tangible equity Profit before tax of $227 million, decreased 19% in constant currency, driven by provision building. Net revenue of $1.4 billion, decreased 5%. In constant currency, net revenue, increased 4%, driven by solid noninterest revenue growth, particularly in foreign-exchange (FX) sales. Net interest income of $707 million, decreased 15%, or 6%, in constant currency, primarily driven by spread compression, partially offset by modest growth in interest earning assets. Non-interest revenue of $645 million, increased 8%, or 17%, in constant currency, primarily driven by an increase in client-related FX sales and trading, which continued to benefit from improving FX liquidity and client activity in the Investors and Exporters FX window, or NAFEX, in Nigeria. Additionally, higher short-term interest rates, benefited income generated from fixed income securities trading. Non-interest revenue ratio, the proportion of net revenue that is generated from non-capital intensive sources was 47.7% compared to 41.8%, in the prior year period, largely reflecting the deliberate strategy to reduce lending in the current environment. Ecobank Group 9M 2017 Earnings Release Page 2

3 Operating expenses of $834 million, decreased 11%, or 3%, in constant currency, reflecting continued group-wide optimisation initiatives, which included, among other things, right-sizing of staff or people resources, closure of nonstrategic branches, and improved procurement processes. As a result, the cost-to-income ratio of 61.7% was an improvement on the 65.5% achieved in the year ago period. And this, despite one-off restructuring costs of $9.3 million in the Central, Eastern, and Southern African region. Impairment losses were $292 million (of which $237 million were on loans and advances), compared to $213 million (of which $206 million were on loans and advances) in the prior year period. Impairment losses on loans remained elevated as guided driven by Commercial Banking and Corporate Bank, as the operating environment remained challenging, particularly impacting small-sized businesses ability to make loan payments. Included in the nine months to September impairment losses of $292 million is an exceptional charge of $42 million on other assets booked in the second-quarter, which was related to a claw back from AMCON that was linked to loans previously sold by Ecobank Nigeria in For the period, the annualised cost-of-risk was 3.2%, which was within the guidance range for year-end Selected Balance Sheet Information 30 Sept 31 Dec 30 Sept Period As At: (in billions of $, except per share amounts) Gross loans Less: allow ance for impairments Net loans Customer deposits Total assets Shareholders' equity Total equity Risk-w eighted assets (RWA) Loans-to-deposits ratio 69.1% 73.1% 74.6% Tier 1 capital ratio (Basel) 23.7% 23.4% 22.0% Total capital adequacy ratio (CAR) 25.6% 25.3% 24.2% End-of-period ordinary shares outstanding (millions of shares) 24,730 24,730 24,100 # of ordinary shares to be issued if issued dilutive instruments convert (see appendix ) 303 # of ordinary shares to be issued if issued convertible debt converts (see appendix ) 6,667 Book value per ordinary share, BVPS ($ cents) Tangible book value per ordinary share, TBVPS, ($ cents) Share price ($ cents): High Low Period end End-of-period (EOP) Exchange rates of key curriencies vs US$ Nigerian Naira (NGN) Francophone CFA Ghana Cedi (GHS) Customer loans (net) of $9.3 billion, decreased 6%, or 7% in constant currency, driven by a deliberate strategy to reduce lending in the current operating environment, while focusing intensely on recovering loans where interest and principal payments were past due. Customer deposits of $14.1 billion were largely unchanged from the year ago period, both on a nominal and a constant currency basis. Growth in customer deposits was strong in all regions, except for Nigeria, where higher short-term treasury yields offered attractive returns. Excluding Nigeria, customer deposits increased by 7% in constant currency Total equity of $2.0 billion was flat if compared to the prior year period. The official rate was used in consolidating Nigerian entity. If the exchange rate moved to NAFEX rate total equity would be impacted by approximately $130 million or 6.4%, and the Nigerian entity would still remain adequately capitalised Ecobank Group 9M 2017 Earnings Release Page 3

4 The Group s total capital adequacy ratio (CAR) was 25.6% compared with 24.2% in the prior year period. Basel I Tier I capital ratio was 23.7% compared to 22.0% as of September The improvement in the Group s capital ratios was primarily driven by a reduction in risk-weighted assets Risk-weighted assets (RWA) were $12.9 billon as at September 2017, compared to $13.4 billion, in the prior year period. The decrease was primarily driven by reduction in lending activity and partly by adverse currency movements. Asset Quality Nine months ended 30 Sept 31 Dec 30 Sept (In millions of $) Impairment losses: On loans & advances On other assets 55 7 Impairment losses on financial assets Cost-of-risk (1) 3.2% 2.5% 30 Sept 31 Dec 30 Sept As at: Non-performing loans (NPLs) Allow ance for impairment losses NPL ratio 9.6% 9.6% 8.9% NPL coverage ratio 53.9% 64.3% 66.5% (1) Cost-of-risk is calculated on an annualised year-to-date basis; Note: totals may not add up due to rounding Net impairment losses on loans for the nine months were $237 million compared to $206 million in the prior year period. Impairment losses continue to remain elevated as guided, mainly because the operating environment remains fragile, whilst at the same time, we continue to address credit quality challenges. Included in the period s impairment losses on financial assets of $55 million is an exceptional charge of $42 million on other assets from the second-quarter reflecting a claw back from AMCON linked to loans previously sold by Ecobank Nigeria in Non-performing loans were $934 million for the nine months to September compared with $948 million, and $930 million, as at 31 December 2016, and 30 September 2016, respectively. The current period s non-performing loans remain elevated, predominantly because of higher non-performing loans in Central, Eastern, and Southern Africa region. The non-performing loans ratio was 9.6% compared to 8.9% in prior year period. Ecobank Group 9M 2017 Earnings Release Page 4

5 GEOGRAPHICAL REGION FINANCIAL PERFORMANCE Ecobank s operations in Africa are grouped into four geographical regions. These are Nigeria, Francophone West Africa (UEMOA), Anglophone West Africa (AWA), Central Africa, Eastern Africa and Southern Africa (CESA). Comparisons noted in the commentary below are calculated for the first nine months of 2017 versus the first nine months of 2016, unless otherwise specified. In millions of $, except for ratios As of September 2017 NIGERIA UEMOA AWA CESA ETI & OTHERS (1) Subtotal: Entities RV (2) Ecobank Group Income Statement Highlights NII (24) NIR Net revenue ,353-1,353 Total operating expenses Pre-impairment income (36) 519 (0) 519 Impairment losses (178) (59) (44) (22) (6.9) (310) 18 (292) Profit before tax (43) Profit after tax (48) Balance Sheet Highlights Net loans 2,698 3,493 1,056 1, ,258-9,258 Total assets 5,850 7,678 2,769 4, , ,961 Customer deposits 3,082 5,436 2,099 3, ,126-14,126 Total equity ,282 (249) 2,032 Ratios ROA 1.3% 1.4% 2.6% 0.9% - 1.2% - 1.2% ROE 9.1% 23.6% 24.4% 8.7% % % Cost-to-income ratio 47.1% 61.2% 53.3% 76.7% % % NPL ratio (3) 9.7% 7.1% 9.8% 14.1% - 9.6% - 9.6% NPL coverage (3) 81.3% 38.8% 32.7% 49.3% % % Loans-to-deposits ratio 95.0% 66.1% 52.0% 57.2% % % 1. ETI & Others comprise ETI, the Holdco, eprocess (the Group's technology service company), the International business in Paris, Ecobank Development Corp. (the Group's Investment Banking and Securities and Asset Management businesses), and also the impact of other affiliates and structured entities of ETI. The impact of consolidation eliminations is also included in 'ETI & Others' 2. The Resolution Vehicle (RV), a structured entity that was set up in Nigeria to purchase and hold the challenged legacy assets from Ecobank Nigeria's core assets. 3. Due to Regulatory condition precedent in the UEMOA region loans can only be written off when a court approves the settlement. For this reason the loans fully provided for 12 months have been adjusted at a Group level to reflect the NPL status consistent with other regions. This amounts to approximately $200 million of fully provided loans. Without this adjustment the NPL ratio for UEMOA and the Group would be 12.0% and 11.4% respectively and coverage ratio for UEMOA and the Group would be 65.7% and 62.1% respectively. Ecobank Group 9M 2017 Earnings Release Page 5

6 NIGERIA In Constant $ Nine months ended 30 Sept (in millions of $) YoY 2017 Net interest income (27%) 301 Non-interest revenue % 264 Net revenue (8%) 566 Operating expenses (30%) 267 Pre-impairment income % 299 Impairment losses % 227 Profit before tax (19%) 73 Profit after tax (19%) 72 Customer loans (net) 2,698 3,183 (15%) 2,647 Total assets 5,850 6,208 (6%) 5,739 Customer deposits 3,082 3,562 (13%) 3,024 Total equity % 856 Cost-to-income ratio 47.1% 62.1% ROE 9.1% 9.4% Loans-to-deposits ratio 95.0% 95.3% NPL ratio 9.7% 7.8% NPL coverage ratio 81.3% 79.6% Capital Adequacy Ratio (CAR) 17.0% 16.0% Note: selected income statement lines only and thus may not sum up Highlights Profit before tax of $57 million, decreased 19%, primarily driven by currency translation effects and an exceptional impairment charge of $42 million on other assets booked in the second-quarter due to a claw back from AMCON linked to loans previously sold. In constant currency, profit before tax increased 4% to $73 million, driven by positive operating leverage Net revenue of $446 million, decreased 8%, or in constant currency, increased 17%. The increase was primarily driven by higher non-interest revenue Net interest income was $237 million, a decrease of 27%, or 7%, in constant currency, primarily driven by a reduction in interest earnings assets led by lower loan balances, partially offset by the net impact of higher interest rates Non-interest revenue was $208 million, an increase of 31%, or 66%, in constant currency, primarily driven by higher fixed income and currency trading benefiting from improved liquidity and volumes in the NAFEX window and higher short-term interest rates Operating expenses of $210 million, decreased 30%, or 11%, in constant currency, driven by efficiency gains in personnel costs, associated staff expenses, and rent and utilities. The cost-to-income ratio was 47% versus 62% in the prior year period Impairment losses for the period were $178 million compared to $114 million in the prior year period. The impairment losses for the first nine months of the year reflected additional loan loss reserve builds on existing oil and gas, and services, loans and the exceptional $42 million charge on other assets in the second-quarter Ecobank Group 9M 2017 Earnings Release Page 6

7 UEMOA In Constant $ Nine months ended 30 Sept (in millions of $) YoY 2017 Net interest income % 176 Non-interest revenue (0%) 142 Net revenue % 318 Operating expenses % 195 Pre-impairment income % 123 Impairment losses % 55 Profit before tax (5%) 68 Profit after tax % 74 Customer loans (net) 3,493 3,193 9% 3,302 Total assets 7,678 7,052 9% 7,258 Customer deposits 5,436 4,983 9% 5,139 Total equity % 471 Cost-to-income ratio 61.2% 60.2% ROE 23.6% 26.2% Loans-to-deposits ratio 66.1% 69.1% NPL ratio (1) 7.1% 10.7% NPL coverage ratio (1) 38.8% 56.5% N o te: s elected income statement line items only and thus may not sum up Highlights Profit before tax was $73 million, a decrease of 5%, primarily driven by lower revenue Net revenue was $341 million, a decrease of 2%, primarily driven by lower non-interest revenue Net interest income was $188 million, up 5%, driven by an increase in interest earning asset balances, partially offset by spread compression Non-interest revenue of $152 million was flat compared to the year ago period, driven by client-related FX sales and increased client activity, partially offset by lower fees and commissions from cash management fees and credit origination Operating expenses of $209 million, increased 3%, driven by an increase in staff salaries and benefits, and depreciation and amortisation costs. The cost-to-income ratio was 61% compared to 60% in the prior year period Impairment losses were $59 million compared to $53 million in the prior year period. The current period s impairment losses, reflected higher reserve build. The non-performing loans ratio was 7.1% versus 10.7% a year ago 1. Due to Regulatory condition precedent in the UEMOA region loans can only be written off when a court approves the settlement. For this reason the loans fully provided for 12 months have been adjusted at a Group level to reflect the NPL status consistent with other regions. This amounts to approximately $200 million of fully provided loans. Without this adjustment the NPL ratio for UEMOA and the Group would be 12.0% and 11.4% respectively and coverage ratio for UEMOA and the Group would be 65.7% and 62.1% respectively. Ecobank Group 9M 2017 Earnings Release Page 7

8 AWA In Constant $ Nine months ended 30 Sept (in millions of $) YoY 2017 Net interest income (17%) 185 Non-interest revenue % 111 Net revenue (10%) 297 Operating expenses (4%) 159 Pre-impairment income (16%) 138 Impairment losses % 51 Profit before tax (38%) 87 Profit after tax (39%) 60 Customer loans (net) 1,056 1,161 (9%) 1,168 Total assets 2,769 2,829 (2.1%) 3,025 Customer deposits 2,099 2,060 2% 2,292 Cost-to-income ratio 53.3% 49.9% ROE 24.4% 38.0% Loans-to-deposits ratio 52.0% 60.0% NPL ratio 9.8% 16.1% NPL coverage ratio 32.7% 38.3% N o te : selected income statement line items only and thus totals may not sum up Highlights Profit before tax of $78 million, decreased 38%, or 31%, in constant currency. The decrease was primarily driven by higher impairments and operating expenses Net revenue of $262 million, decreased 10%, but up 2%, in constant currency, primarily driven by an increase in non-interest revenue Net interest income was $164 million, down 17%, or 5%, in constant currency, driven by a reduction in interest earning assets and spread compression following declines in short-term interest rates in Ghana Non-interest revenue was $98 million, an increase of 5%, or 20%, in constant currency, primarily driven by strong client activity in trade finance and an increase in ATM and card fees, partially offset by lower fees and commissions on loans and cash management Operating expenses of $140 million, decreased 4%, or in constant currency, increased 9%.The increase in constant currency reflected higher staff-related allowances and ICT-related costs. The cost-to-income ratio was 53.3% versus 49.9% in the prior year period Impairment losses were $44 million compared to $20 million in the prior year period. The increase in the period s impairment losses reflected loan loss reserve builds for mostly energy-related exposures in Ghana. The non-performing loan ratio was 9.8% compared to 16.1% a year ago Ecobank Group 9M 2017 Earnings Release Page 8

9 CESA In Constant $ Nine months ended 30 Sept (in millions of $) YoY 2017 Net interest income (1%) 146 Non-interest revenue (3%) 151 Net revenue (2%) 297 Operating expenses % 234 Pre-impairment income (17%) 64 Impairment losses (1%) 23 Profit before tax (24%) 41 Profit after tax (25%) 28 Customer loans (net) 1,751 2,060 (15%) 1,767 Total assets 4,385 4,175 5% 4,505 Customer deposits 3,289 3,100 6% 3,390 Total equity % 482 Cost-to-income ratio 76.7% 72.6% ROE 8.7% 11.7% Loans-to-deposits ratio 57.2% 69.7% NPL ratio 14.1% 9.0% NPL coverage ratio 49.3% 51.5% N o te: s elected income statement lines only and thus totals may not sum up Highlights Profit before tax was $42 million, down 24%, or 28%, in constant currency, primarily driven by higher oneoff restructuring costs of $9.3 million. Adjusting for the restructuring costs, profit before tax would have been $52 million Net revenue of $277 million, decreased 2%, or in constant currency, increased 5%, primarily driven by growth in non-interest revenue Net interest income was $142 million, a decrease of 1%, or an increase of 2%, in constant currency. The modest increase in net interest income was driven by growth in investment securities Non-interest revenue was $135 million, a decrease of 3%, or in constant currency, an increase of 8%. The constant currency increase in non-interest revenue was driven by client-related FX sales and cash management fees, partially offset by reduction in fees and commissions on loans Operating expenses of $213 million, up 3%, or 14%, in constant currency, was predominantly driven by one-off restructuring costs of approximately $9.3 million, partially offsets by a decrease in depreciation and amortisation costs related to technology and closure of non-strategic branches. The cost-to-income ratio was 76.7% (73.3% if adjusted for the restructuring costs), compared with 72.6% in the prior year period Impairment losses for the period were $22 million, largely unchanged from the prior year period. The current period s impairment losses were driven by an increase in non-performing loans. The non-performing loans ratio increased to 14.1% compared with 9.0% in the prior year period. # # # About Ecobank: Incorporated in Lomé, Togo, Ecobank Transnational Incorporated (ETI) is the parent company of the leading independent pan-african banking Group, Ecobank, present in 36 African countries. The Ecobank Group is also represented in France through its subsidiary EBI SA in Paris. ETI also has representative offices in Dubai-United Arab Emirates, London-UK, Beijing-China, Johannesburg-South Africa, and Addis Ababa-Ethiopia. ETI is listed on the stock exchanges in Lagos, Accra, and the West African Economic and Monetary Union (UEMOA) the BRVM in Abidjan. The Group is owned by more than 600,000 local and international institutional and individual shareholders. It employs over 16,000 people in 40 different countries in over 1,200 branches and offices. Ecobank is a full-service bank, providing wholesale, retail, investment and transaction banking services and products to governments, financial institutions, multinationals, international organisations, medium, small and micro businesses and individuals. Additional information may be found on the Group s corporate website at: Ecobank Group 9M 2017 Earnings Release Page 9

10 Cautionary note regarding forward-looking statements Certain statements in this document are forward-looking statements. These statements are based on management s current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from those included in these statements. Management Conference Call Ecobank will host a live conference call on Thursday 2 November 2017 at 14:00 GMT (15:00 Lagos time) to present the financial results for the nine months ended 30 Sept 2017 and outlook to year end. There will be a Q&A session at the end of the call. The conference call facility can be accessed via online registration using the link provided below: Conference call online registration: Please note the key steps in the registration process outlined below: Upon registering each participant will be provided with Participant Dial-in Numbers, Direct Event Passcode and unique Registrant ID. Registered Participants will also receive a call reminder via the day prior to the event. In the 10 minutes prior to call start time, Participants will need to use the conference access information provided in the received at the point of registering. Note: Due to regional restrictions some participants may receive Operator assistance when joining this conference call and will not be automatically connected (Helpful keypad commands: *0=operator assistance; *6=selfmute/unmute) If you should encounter any problems with the online registration, please dial the following number for assistance: (you will also need to provide the Conference ID: ). For those who are unable to listen to the live call, a replay of the conference all will be available from 17:30 GMT on 2 November to 17:30 GMT to 11 November You may participate by dialling , UK free call: , or USA: 1 (866) and the Conference ID: The earnings presentation will be posted on our website prior to the conference call at Investor Relations Ecobank is committed to continuous improvement in its communication to investors. For further information, including any suggestions as to how we can communicate more effectively, please contact Ato Arku via ir@ecobank.com. Full contact details below: Investor contact: Ato Arku T: M: E: aarku@ecobank.com Ecobank Group 9M 2017 Earnings Release Page 10

11 APPENDIX POTENTIAL DILUTIVE INSTRUMENTS European Investment Bank (EIB) convertible and subordinated loan A total outstanding balance of $ million in loans granted by EIB are convertible into ordinary shares. The conversion price is the lower of i) $ cents plus a premium that varies from 0% to 30%, depending on exercise date; and ii) the prevailing market price, based on a 45 day average. Conversion can occur any time from 30 December 2012 until 30 December Opec Fund for International Development (OFID) convertible and subordinated loan A total outstanding balance of $ million in loans granted by OFID are convertible into ordinary shares. The conversion price is the lower of i) $ cents plus a premium that varies from 30% to 50%, depending on exercise date; and ii) the prevailing market price, based on a 45 day average. Conversion can occur any time from 15 June 2016 until 3 July ETI $400 million convertible debt The $400 million convertible debt due 2022 will have a maturity of five (5) years from date of issuance, a coupon rate comprising a reference rate of 3-month LIBOR plus a spread of 6.46% (i.e. 3-month LIBOR %), payable semi-annually in arrears. The debt will be convertible into ETI ordinary shares at an exercise price of 6.00 $ cents (NGN21.60, GHS0.26, XOF34.26 at current exchange rates for illustrative purposes only) during the conversion period of 19 October 2019 to 13 October These debt will be redeemed at 110% of principal amount if the conversion option is not exercised. Ecobank Group 9M 2017 Earnings Release Page 11

12 Ecobank Group IFRS CONSOLIDATED INCOME STATEMENT FOR THE NINE MONTHS ENDED 30 SEPTEMBER 2017 In thousands of US dollars, except per share amounts Unaudited Sept 2017 Unaudited Sept 2016 Revenue Interest income 1,155,297 1,260,304 Interest expense (448,127) (429,752) Net interest income 707, ,552 Fee and commission income 337, ,671 Fee and commission expense (44,699) (39,079) Net trading income 330, ,536 Other operating income 21,833 19,757 Non-interest revenue 645, ,885 Operating income 1,352,524 1,427,437 Operating expenses Staff expenses (380,205) (438,039) Depreciation and amortisation (70,224) (73,358) Other operating expenses (383,464) (423,204) Total operating expense (833,893) (934,601) Operating profit before impairment losses and taxation 518, ,836 Impairment losses on: loans and advances (236,587) (205,510) other financial assets (55,356) (7,021) Impairment losses on financial assets (291,943) (212,531) Operating profit after impairment losses 226, ,305 Share of profit of associates Profit before tax 226, ,695 Taxation (38,081) (64,549) Profit for the period from continuing operations 188, ,146 Profit/loss for the period from discontinued operations 640 (1,977) Profit for the period 189, ,169 Attributable to: Owners of the parent (total) 162, ,497 Continuing operations 161, ,565 Discontinued operations 346 (1,068) Non-controlling interest (total) 27,368 36,672 Continuing operations 27,074 37,581 Discontinued operations 294 (909) Earnings per share from continuing operations attributable to owners of the parent during the period (expressed in United States cents per share) 189, ,169 Basic Diluted Ecobank Group 9M 2017 Earnings Release Page 12

13 Ecobank Group IFRS CONSOLIDATED STATEMENT OF FINANCIAL POSITION In thousands of US dollars Assets Unaudited Sept 2017 Audited Dec 2016 Cash and balances with central banks 2,317,468 2,462,302 Financial assets held for trading 24,288 77,408 Derivative financial instruments 10,000 68,204 Loans and advances to banks 1,535,550 1,413,699 Loans and advances to customers 9,257,902 9,259,374 Treasury bills and other eligible bills 1,327,502 1,228,492 Investment securities: available-for-sale 3,764,194 3,272,824 Pledged assets 544, ,205 Other assets 754, ,821 Investments in associates 9,672 10,135 Intangible assets 284, ,766 Property, plant and equipment 907, ,047 Investment properties 33,425 35,819 Deferred income tax assets 112, ,007 Assets held for sale 75,884 69,871 Total assets 20,958,572 20,510,974 Liabilities Deposits from banks 1,517,329 2,022,352 Deposits from customers 14,126,294 13,496,720 Derivative financial instruments 11,969 23,102 Borrowed funds 1,647,867 1,608,564 Other liabilities 1,321,029 1,342,635 Provisions 54,667 28,782 Current income tax liabilities 45,864 54,539 Deferred income tax liabilities 60,542 60,169 Retirement benefit obligations 34,137 15,731 Liabilities held for sale 104,683 94,302 Total liabilities 18,924,381 18,746,896 Equity Capital and reserves attributable to the equity holders of the parent company Share capital 2,113,958 2,114,332 Retained earnings and reserves (302,839) (536,408) Shareholders' equity 1,811,119 1,577,924 Non-controlling interests 223, ,154 Total equity 2,034,191 1,764,078 Total liabilities and equity 20,958,572 20,510,974 Ecobank Group 9M 2017 Earnings Release Page 13

14 Ecobank Group IFRS CONSOLIDATED STATEMENT OF CASH FLOWS In thousands of US dollars Unaudited Sept 2017 Audited Dec 2016 Cash flow from operating activities Profit/ (Loss) before tax 226,908 (131,341) Net trading income - foreign exchange (61,059) (82,938) Net (gain)/loss from investment securities 3,066 (26,381) Fair value (gain)/loss on investment properties - 29,672 Impairment losses on loans and advances 236, ,268 Impairment losses on other financial assets 55,356 93,583 Depreciation of property and equipment 59,348 85,112 Net interest income (707,170) (1,106,446) Amortisation of software and other intangibles 10,876 14,084 Profit on sale of property and equipment (3,102) (938) Share of profit/(loss) of associates (220) 2,542 Income taxes paid (61,620) (121,712) Changes in operating assets and liabilities Trading assets 53,120 93,926 Derivative financial assets 58,204 76,021 Other treasury bills (29,814) (30,695) Loans and advances to banks (192,566) 371,394 Loans and advances to customers (93,112) 1,988,569 Pledged assets (26,558) 240,881 Other assets 96,498 (337,193) Mandatory reserve deposits (65,758) 440,073 Due to customers 629,574 (2,930,833) Derivative liabilities (11,133) 21,766 Other provisions 25, Other liabilities (8,675) 293,576 Interest received 1,155,297 1,672,852 Interest paid (448,127) (566,406) Net cash flow from operating activities 901, ,524 Cash flows from investing activities Purchase of software (11,371) (31,321) Purchase of property and equipment (173,701) (227,390) Proceeds from sale of property and equipment - 20,860 Purchase of investment securities - (1,513,241) Purchase of investment properties 2,394 (1,101) Proceeds from sale and redemption of securities (491,370) 387,046 Net cashflow used in investing activities (674,048) (1,365,147) Cash flows from financing activities Repayment from borrowed funds 39,303 (505,938) Proceeds from borrowed funds - 744,999 Dividends paid to non-controlling shareholders (23,945) (32,715) Dividends paid to owners of the parent - (48,200) Net cashflow from financing activities 15, ,146 Net decrease in cash and cash equivalents 243,114 (347,477) Cash and cash equivalents at start of the period 2,020,838 2,610,050 Effects of exchange differences on cash and cash equivalents (363,232) (241,734) Cash and cash equivalents at end of the period 1,900,721 2,020,838 ` Ecobank Group 9M 2017 Earnings Release Page 14