Ecobank Tanzania Q1 2024 Profits Increase Fivefold Year-on-Year

Ecobank Tanzania recently announced exceptional growth and significant achievements for the first quarter of 2024, continuing the robust performance from the 2023 financial year.

In Q1 2024, revenues increased by 66% to nearly TZS 10 billion compared to Q1 2023, driven by increased lending to support Tanzania’s economy and growing business volumes. This growth was underpinned by strong customer acceptance of the bank’s products.

Profit before tax for Q1 2024 was TZS 3.5 billion, nearly five times higher than in Q1 2023. This remarkable increase positioned Ecobank Tanzania among the top-performing banks in the market. The profit surge was supported by controlled costs and decreased impairment charges, with the Non-Performing Loans (NPL) ratio remaining below 3% for the past two years.

Operating efficiency also improved, as evidenced by a reduction in the cost-to-income ratio to less than 60% for the first time, compared to 77% a year ago. Additionally, the annualized return on equity rose to 44%, up from 12% in 2023.

The bank attributes its success to the steadfast support of its customers, partners, and employees.

“These impressive results reflect the increasing customer confidence in our business,” the bank explained. “Deposits grew by 68% to TZS 313 billion, driving a 27% increase in total assets to TZS 415 billion. Strong deposit growth enabled us to expand our loan book by more than TZS 65 billion to TZS 157 billion.”

Ecobank Tanzania 2023 Performance Highlights

In 2023, Ecobank Tanzania’s revenues surged by 48%, reaching TZS 31.26 billion, up from TZS 21.11 billion in 2022. Profit before tax increased dramatically by 496%, from TZS 1.61 billion in 2022 to TZS 9.59 billion in 2023.

The bank’s cost-to-income ratio improved significantly, decreasing from 90.56% in 2022 to 65.1% in 2023, reflecting effective cost management strategies. The loans and advances portfolio grew by 79%, from TZS 91.75 billion in 2022 to TZS 164.50 billion in 2023.

Customer deposits rose by 48%, from TZS 185.97 billion in 2022 to TZS 274.59 billion in 2023, demonstrating strong customer relationships and trust in Ecobank’s services. Total assets increased by 27%, reaching TZS 406.69 billion in 2023.

Ecobank Tanzania ranks third highest in YoY total assets growth at 26.76%. With a YoY growth in customer deposits of 48.33%, it ranks third in the market, and it leads in loans and advances with a remarkable 79.30% share, the highest YoY growth.

Furthermore, Ecobank Tanzania’s YoY revenue growth of 48.50% underscores its strong revenue generation compared to other banks. The bank operates five branches across Dar es Salaam, Arusha, and Mwanza, with an extensive network of ATMs and over 700 agents nationwide, ensuring wide accessibility to its services.

Group Performance and Future Outlook

These achievements align with the broader success of the Ecobank Group, the pan-African financial services conglomerate. Despite the challenging operating environment in 2023, the Ecobank Group reported a return on tangible shareholders’ equity of 24.9% and an 8% increase in profit before tax (or 34% at constant currency), reaching $581 million. Net revenue surpassed the $2.0 billion mark for the first time since 2015, growing by 11% (or 31% at constant currency) to $2.1 billion. This performance highlights the early successes of the Group’s 5-year Growth, Transformation, and Returns (GTR) strategy.

Looking ahead, Ecobank Tanzania is committed to enhancing its services, expanding its reach, and fostering partnerships that drive growth and development in Tanzania. The bank remains dedicated to supporting businesses and individuals in achieving their financial goals, further solidifying its position as a key player in the Tanzanian banking sector.