- says full amortisation realised by end year five
- good for the environment as well as bank’s bottomline
- bank declares 55p per share in dividend at 33rd AGM
As further evidence of its commitment to environmental sustainability, 35 of Ecobank’s 65 branches in the country will be powered by solar energy, its Managing Director, Daniel Sackey, has said. Currently, there are 32 branches which have a hybrid power system, with three more expected in the coming month.
Responding to a question posed by a shareholder at the bank’s 33rd Annual General Meeting (AGM), which was held virtually, Mr. Sackey stated that the current arrangement, in which Ecobank does not make an initial financial outlay on installations, has been crucial in the effective cost management regime of the lender, and this, he noted, has been reflected in its bottomline.
He explained that the bank’s hybrid set up allows for full solar power by day, with shortfalls met by the grid. Also, full amortisation is expected by the end of year five, with nominal savings accruing from the sixth year.
“We have achieved this without putting up a financial outlay by engaging stakeholders who set up the installation at their own cost… Savings from the solar results in lower charges and savings are used to pay for the installations and we expect that over five years, each of these installations would be fully amortised. In the first five years, we have, more or less, sterilised our spend on electricity. In effect, we are keeping capital expenditure low and benefiting from the switch,” he said.
He, however, stated that the pace at which full coverage is achieved is primarily dependent on the willingness of proprietors of the buildings, which Ecobank leases, to make the transition, as some have expressed various degrees of concern.
“The challenge in ensuring that all the 65 branches are covered is dependent on if we own the building or the willingness of the proprietor to allow solar installations. Some have categorically said ‘no’ but we continue in our discussions,” he added.
In line with the trend of major banks declaring dividends for shareholders, following the suspension last year due to the Central bank’s COVID-19-induced directive, shareholders voted in favour of a dividend payment of 55p per share, up 83% from the last declared dividend of 30p.
Commenting on this development, the Managing Director stated that it was evidence of the regulator’s confidence in the health of the bank.
“The approval of the regulator indicates that it had taken into consideration the capital adequacy ratio of the bank, the non-performing loan position; the provisions that have been taken to cover this, the liquidity needs of the bank and loan projection growth for the next year or two,” he explained.
This follows a year where the bank recorded profit after tax of GH¢543.8 million representing a 23% growth on the 2019 figure of GH¢441.9 million. Similarly, Ecobank profit before tax increased by 22% from the previous accounting year to GH¢773.7 million for the year under review.
Additionally, the value of its total assets appreciated by some 21%, from GH¢13.2 billion in 2019 to GH¢15.89 billion in 2020. Revenue grew by 17% year-on-year (YoY) to GH¢1.8 billion, up from GH¢1.54 billion, whilst net impairment shrunk by 17.3%.
Despite the pandemic still slowly raging, with herd immunity still some way off, as inoculation rate stands at less than 10% of the general population, Mr. Sackey expressed confidence in the growth of the economy and the fortunes of the bank.
He held this position on account of the bank’s first quarter performance which has seen income from fees and interest rise, which he believes will see funded and non-funded income move towards equilibrium.
“It is heartwarming to see that for the first quarter of 2021, we have started seeing an uptick in fees and commissions, given this pace and the recent monetary easing by the Central Bank, we believe it will spur demand for funding.”
Chairman of the Board, Terrence Ronald Darko, assured shareholders and the wider public of the bank’s commitment towards the application of technology to service delivery as well as health and safety.