Why Ecobank Nigeria MD Charles Kie suddenly resigned

Ecobank Nigeria

In a notice sent to the Nigerian Stock Exchange (NSE) this week, Ecobank Transnational Incorporated (ETI) has announced the intentions of Charles Kie to leave the Group. Kie is the Managing Director of Ecobank Nigeria.

The bank also disclosed that the search for a successor had commenced and a successful candidate would be announced before the end of August, 2018.

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Why did he leave?

While the bank, did not expand on Kie’s motives for resignation, he may have taken the step due to police harassment. Kie last year filed a suit at a Federal High Court seeking to restrain officials of the Nigerian Police from arresting him.

The police had allegedly requested that Kie effect the transfer of $10.5 million from a customer’s account. In addition, there was an attempt to arrest him at the bank’s head office.

Recent years have been challenging

The last few years have been challenging for Ecobank Nigeria, arising from the consolidation of its operations with All States Trust Bank, Hallmark Bank and Oceanic Bank. This also weighs on the bank as a whole, as Nigeria operations are a huge chunk of the larger parent.

Ecobank acquired the assets and liabilities of All States Trust Bank and Hallmark Bank in 2006. In October 2011, ETI acquired Oceanic Bank Plc. The entire share capital of Oceanic was cancelled, while its shareholders received one ordinary share of $0.025 and $0.428 preference shares of $0.1032, in ETI, for every 20 held in Oceanic Bank.

ETI (the parent bank) last year set up a Special Purpose Vehicle (SPV) to acquire impaired assets from Ecobank Nigeria. These include legacy loans from Oceanic bank. The bank last paid a dividend for the 2015 financial year.

ETI closed at N20.60 in yesterday’s trading session on the NSE. Year to date, the stock is up 21.18%.

Results for the first quarter ended March 2018 show gross Earnings increased from N178 billion in 2017 to N198 billion in 2018. Profit before tax increased from N22.8 billion in 2017 to N33 billion in 2018. Profit after tax increased from N18.6 billion in 2017 to N27 billion in 2018.

Ecobank Nigeria was incorporated on October 7, 1986, as a public limited liability company and commenced operations on April 24, 1989. In December 2011, ETI became the sole beneficial shareholder, and the bank was re-registered as a private limited liability company on April 5, 2012.

2017 full year results show revenue dipped from N259 billion in 2016 to N251 billion in 2017. Profit after tax however jumped from N5.8 billion in 2016 to N20.4 billion in 2017.

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