Shareholders of Ecobank to enjoy bonus share , despite no dividend payment

Management of Ecobank Ghana has decided not to pay dividends to shareholders of the bank for last year.

This forms part of moves by the bank to plough back its capitalized income surplus into stated capital to enable them, among other things, meet the 400 million capital requirement.

The bank has, however, assured shareholders that it will be issuing bonus shares in addition to capital gains made on stocks of 53 percent in February 2018.

Speaking at the bank's Annual General Meeting (AGM), board chairman of the bank, Terance Darko, assured shareholders that the bank will employ more innovative ways of becoming a leading market in the banking industry.

"We are unable to pay a cash dividend for the year 2017. We will, however, be issuing bonus shares of one share for every ten held which in addition to the capital gains made on our stocks of 53 percent as at February 218, is a big boost to shareholders," he stated.

2017 Performance

Meanwhile, the total revenue of ECOBANK Ghana 1.1 billion Cedis, representing a fall of about seven percent over last year's revenue.

This has been linked to declining interest rates, government borrowing and refinancing of maturing short-term debt.

The bank has described the year as a challenging one due to the difficult macroeconomic environment characterized by declining yields on financial instruments, high levels of non-performing loans and increased competition for deposits as a result of the implementation of the Treasury Single Account policy by the government.

Ecobank generated earnings per share (EPS) of GH O.87, a decline of 22 percent compared with the GHS 1.12 reported in 2016. Return on total shareholder's equity (ROE) was 25 percent in 2017 as against 35 percent in the year before. Profit attributable to shareholders amounted to GHS 254 million, compared to GHS328 million cedis in 2016.

Minimum Capital Requirement.

The Managing Director of ECOBANK Ghana, Dan Sackey is confident the minimum capital requirement will trigger some consolidation across the industry and also see the emergence of financially stronger indigenous banks.

He said the directive by the Bank of Ghana gives the bank leverage to maintaining its market leadership in 2018.

Plans for 2018

Meanwhile, ECOBANK hopes to retain their market leadership, achieve customer migration towards electronic channels and also further improve efficiency by getting rid of redundancies and employing enterprise-wide automation.

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