Ecobank Transnational Inc., Africa’s largest lender by geographical spread, sees loan growth of about 20 percent in 2011 and limited expansion as it’s “bedding in” earlier growth, Chief Executive Officer Arnold Ekpe said.
“We have become much more discriminatory,” Ekpe said in an interview in London today. “As you become bigger it is harder to grow.”
Togo-based Ecobank, whose shares trade in Ghana, Nigeria and on West Africa’s regional bourse, more than doubled profit in 2010 to $112.7 million from $51.1 million a year earlier, as net interest income rose and bad loans dropped.
Ecobank, which has 760 branches in 30 countries in Africa according to Ekpe, is “not really focused on expansion” though the lender has “some gaps to fill” with possible commercial banking moves into Angola and Equatorial Guinea, where it’s awaiting regulatory approval, he said.
The lender is also exploring opportunities in Mozambique and Southern Sudan, Ekpe said. “It’s not like we need to do it in six or 12 months,” he said.
Ecobank’s non-performing loan ratio has dropped to “single digits,” said Ekpe. The decline in non-performing loans from 15.2 percent in the year through December 2010 is partly because loans were sold to the Asset Management Corp. of Nigeria, a state-owned company set up to buy debt from the nation’s operators.
The Central Bank of Nigeria provided 620 billion naira ($4 billion) to eight of the nation’s 24 lenders after loans to equity speculators contributed to 700 billion naira of non-performing debt in 2009, according to the Economic and Financial Crimes Commission in Abuja. Governor Lamido Sanusi fired the chief executives of the distressed lenders and set up Asset Management Corp. of Nigeria, or Amcon, to help recapitalize them before matching them with potential buyers. Ecobank’s Nigerian unit was not one of the bailed out banks.
Ecobank is looking to grow in Nigeria, Africa’s most populous nation, both through existing operations and by acquisition, said Ekpe. “We have looked around” for a bank to buy in the nation, he said, declining to name any.
‘We look to be in the top three of every market we are in,’’ said Ekpe. “In Nigeria we are mid-sized.”