Ecobank Group Annual Report Celebrating 25 years of pan-african banking

Transcription

1 Ecobank Group Annual Report 2013 Celebrating 25 years of pan-african banking

2 Celebrating 25 years of pan-african banking Ecobank would like to thank our customers, staff, shareholders and partners who have supported us in reaching this milestone of twenty five years of operations. The Group has come a long way since opening its first branch in Togo in Africa has also developed rapidly during this time. We are confident about the opportunity and potential for the next 25 years, both for the Group and the continent. The future is pan-african, and Ecobank is the pan-african bank.

3 1 Contents 2013 Highlights 2 Ecobank at a glance 4 Performance highlights 6 The year in review 8 Board and Management Reports 10 Group Chairman s statement 12 Directors report 14 Board of Directors 16 Group Chief Executive s review 24 Group Chief Operating Officer s review 28 Business report: Corporate and Investment Bank 30 Business report: Domestic Bank 31 Operations and Technology report 32 Business and Financial Review 34 Corporate Governance 64 Corporate Governance report 66 Sustainability report 76 People report 94 Risk Management 100 Financial Statements 124 Statement of Directors responsibilities 126 Auditors report 127 Consolidated financial statements 128 Notes to consolidated financial statements 133 Five-year summary financials 206 Parent Company s financial statements 207 Index to notes to the consolidated financial statements 211 Corporate Information 212 Executive management 214 Shareholder information 216 Shareholder contacts 222 Holding company and subsidiaries 223 Customer contact centers 224

4 Highlights 2013 Highlights Our brand and appearance may have evolved over the years, but our core values have always remained the same. Vision Our vision is to build a world class pan-african bank and contribute to the economic development and financial integration of Africa. Mission Our mission is to provide all of our customers with convenient and reliable financial products and services. This is our newest Ecobank Direct branch, located in Accra, Ghana. It was opened in April

5 2013 Highlights Present

6 Highlights Ecobank at a glance Ecobank is the leading pan-african banking group, with a presence in 35 African countries and international offices in Paris, London, Dubai and Beijing. At year end 2013, the Group had US$22.5 billion in assets and US$2.1 billion in total equity. Ecobank is listed on the Lagos, Accra and Abidjan (BRVM) stock exchanges. Our vision and mission Our vision is to build a world-class pan-african bank and contribute to the economic development and financial integration of Africa. Our mission is to provide all of our customers with convenient and reliable financial products and services. We believe we have a responsibility to be socially relevant to the communities that we serve. We are also strongly committed to sustainable development of the region and are a signatory of the Equator Principles, the UNEP Finance Initiative and the UN Global Compact. We are optimistic about both Africa s future and the prospects for its financial services sector. That optimism continues to underpin our pan-african strategy today, just as it did 25 years ago at the opening of our first branch in Togo. Every day our 19,546 employees work hard to service our more than 10.4 million customers, who range from households to governments, domestic and multinational businesses. By providing innovative products and excellent customer service, over time, we hope to create sustainable value for all Ecobank stakeholders. Our businesses Through our two customer-centric business segments, Domestic Bank and Corporate and Investment Bank, we provide a full range of retail, wholesale, investment and transactional banking services. Corporate and Investment Bank See page 30 We provide financial solutions to global, regional and public corporates, financial institutions and international organizations. Products and services include pan-african lending, trade services, cash management, internet banking and value-chain finance. We also provide treasury, corporate finance, investment banking and securities and asset management services. Domestic Bank See page 31 We provide a full range of convenient, accessible, and reliable financial products and services to more than 10 million individuals, small businesses, local corporates and public sector organizations, through our extensive network of 1,284 branches and offices, 2,314 ATMs and over 10,000 POS terminals. Our geographical regions Our geographical regions in Africa are segmented according to shared attributes like common currency and central bank, size and along existing Regional Economic Communities. Within these clusters, Ecobank is structured as a network of locally incorporated, regulated banking entities. Ecobank Nedbank Alliance: the African champion banking network Formed in 2008, the Ecobank Nedbank alliance is the largest banking network in Africa, with more than 2,100 branches in 37 countries. As part of its commitment to offering a uniquely One Bank experience, the alliance provides tailored banking and business advisory solutions to Ecobank and Nedbank clients across Africa. This includes our advisory service, LocalKnowledgeAfrica TM, which provides tailored research and market intelligence for businesses seeking to expand their presence or taking their first steps in Middle Africa. Our key figures As at 31 December 2013 Total equity (US$) 2.1bn Ecobank employees 19,546 Branches and offices 1,284 Total assets (US$) 22.5bn Ecobank customers 10.4m Ecobank ATMs 2,314

7 2013 Highlights 5 Unique pan-african footprint International Revenue $30m Lomé (Headquarters) Luanda (Rep. Office) Addis Ababa (Rep. Office) Total assets $0.5bn Countries 5 France UK Dubai South Africa China Branches Johannesburg (Rep. Office) Employees 86 Francophone West Africa Nigeria Rest of West Africa Central Africa East Africa Southern Africa Revenue $434m Revenue $819m Revenue $383m Revenue $185m Revenue $68m Revenue $76m Total assets $6.5bn Total assets $9.2bn Total assets $3.0bn Total assets $2.3bn Total assets $1.0bn Total assets $0.6bn Countries 9 Benin Burkina Faso Côte d Ivoire Cape Verde Mali Niger Senegal Togo Guinea-Bissau Countries 1 Nigeria Countries 5 Ghana Guinea Liberia Sierra Leone Gambia Countries 7 Cameroon Chad Central Africa São Tomé and Príncipe Congo Gabon Equatorial Guinea Countries 7 Rwanda Kenya Burundi Uganda Tanzania South Sudan Ethiopia (rep. office) Countries 5 DR Congo Malawi Zambia Zimbabwe Angola (rep. office) Branches 262 Branches 610 Branches 150 Branches 85 Branches 93 Branches 53 Employees 2,954 Employees 10,097 Employees 2,475 Employees 1,200 Employees 1,311 Employees 598 The number of employees for the Group is inclusive of employees of ETI, EDC and eprocess which are not represented in our geographic clusters. The number of branches for the Group is inclusive of number of offices which are not part of the numbers of the clusters. The Group total assets and revenues are made up of numbers from our geographic clusters, other entities not part of our cluster grouping and the impact of consolidation adjustments.

8 Highlights Performance highlights Net revenue for 2013 surpassed US$2.0bn, showing strong year-on-year organic growth of 16% despite a tough operating environment. Selected income statement data For the year ended 31 December (in millions of US Dollars, except per share data) Change (%) Net revenue 2,003 1, % Operating expenses 1,405 1, % Pre-impairment profit % Impairment losses % Profit before tax % Profit for the year from continuing operations % Profit attributable to owners of the parent (from continuing operations) % Earnings per share (from continuing operations) Basic % Diluted % Dividend per share 0.40 Selected statement of financial position data As at 31 December (in millions of US Dollars, except per share data) Change (%) Loans and advances to customers (net) 11,422 9, % Total assets 22,532 19, % Customer deposits 16,490 14, % Total equity 2,135 2,174-2% Book value per share ($ cents) % Selected ratios As at, or for year ended, 31 December 2013 Net interest margin 7.2% (2012: 6.5%) Cost-to-income ratio 70.1% (2012: 71.4%) NPL ratio 6.2% (2012: 5.6%) Coverage ratio 79.0% (2012: 74.1%) Tier 1 capital ratio 13.0% (2012: 15.2%) Capital adequacy ratio 16.3% (2012: 19.3%)

9 2013 Highlights 7 Net revenue* (US$m) Pre-impairment profit* (US$m) 598 Profit before tax* (US$m) 338 2, , , Customer loans (net) (US$bn) Customer deposits (US$bn) Total assets (US$bn) Attributable profit* (US$m) 246 Earnings per share (basic)* (US cents) Return on average equity (%) * 2012 and 2013 figures relate to continuing operations

10 Highlights The year in review Q1 January March Ecobank hosted its inaugural Capital Markets Day at its Lomé headquarters, providing major shareholders and investment analysts with insights into the Group s strategic priorities and its growth targets for Q2 April June Ecobank won 2013 Award for Innovation in Banking in African Banker s awards, in recognition of its significant contribution to improving financial inclusion across Africa, leveraging technology and its pan-african footprint. Launched in 2013, Ecobank s MobileMoney service enables customers to make payments, collections and transfers, check balances and buy airtime via their mobile telephones. Senior management attend Ecobank Capital Markets Day (L R Patrick Akinwuntan, Head of Domestic Bank; Graham Dempster, COO Nedbank Group, Evelyne Tall; Group COO, Samuel Ayim, Company Secretary; Laurence do Rego, Group Executive Director, Finance). February 2013 African Development Bank approved US$200m facility to support Ecobank s trade finance activities across Africa. Ecobank sold majority stake in Oceanic Life, its life assurance business in Nigeria, to Old Mutual. March 2013 Celent, the financial services consultancy firm, recognized Ecobank s Omni online corporate cash management platform with a Model Bank award for its innovative approach, business success and integration excellence. April 2013 Ecobank senior management conducted facts behind the figures presentations at the Nigeria, Ghana and BRVM stock exchanges. June 2013 Ecobank Ghana won the Bank of the Year category in the annual Ghana Banking Awards. The award is given to the bank with the highest weighted scores for customer satisfaction, corporate social responsibility and financial performance. Ecobank announced that it is working with authorities in Côte d Ivoire and Nigeria to finance the Abidjan Lagos transport corridor, a transnational highway passing through five West African countries, due to be completed in 2016.

11 2013 Highlights 9 Q3 July September Ecobank Research won Africa Investor s award for Best Africa Research team for the third consecutive year. Q4 October December Ecobank and the Global Fund to Fight AIDS, Tuberculosis and Malaria launched US$3m of innovative funding, aimed at strengthening financial management capabilities of grant recipients. Albert Essien, Head of Corporate and Investment Banking, receives the award on behalf of Ecobank Research from Africa Investor s MD, Hubert Danso. July 2013 Ecobank supported the development challenges facing Africa s youngest state by setting up its 32nd African banking subsidiary in South Sudan. September 2013 Airtel partnered with Ecobank to provide mobile banking in nine African countries. African Guarantee Fund provided Ecobank with a US$50m portfolio guarantee to support SMEs in Benin, Burkina Faso, Nigeria, Cameroon, Côte d Ivoire, the Democratic Republic of Congo and Kenya. Ecobank was a first-time participant in SIBOS, the global financial services forum, in Dubai in a joint initiative with Nedbank. Charles Kie (far right), Ecobank s Head of Corporate Banking attends launch of the Global Fund s Fourth Replenishment in Washington DC in the presence of Bill Gates and other corporate donors. October 2013 Ecobank held its first Ecobank Day, encouraging all employees to devote a day of their free time to community volunteering. Ecobank opened its Ethiopian representative office in Addis Ababa, bringing the total of African countries in which the bank is present to 35. Ecobank won Global Finance s inaugural Best Frontier Bank Award. Omni, Ecobank s real-time cross-border payment and cash management system, successfully deployed in 30 African countries. Chairman Kolapo Lawson stepped down and André Siaka assumed Ecobank chairmanship December 2013 Ecobank signed a US$50 million, 10-year loan agreement with French development institution, Proparco, to support the growth of its banking network. Ecobank and Nedbank teams at SIBOS 2013 in Dubai. Ecobank Capital acted as the Mandated Lead Arranger for a US$500 million pre-export deal on behalf of Orion Oil in the largest syndicated loan transaction in Central Africa to date funded solely by regional banks.

12 10 Board and Management Reports Board and Management Reports Our founders and early shareholders had an entrepreneurial spirit of resilience and determination that saw them through many challenges. This passion continues to drive us to learn from the challenges of today to build a stronger institution for the future. The Ecobank spirit remains strong, over 25 years on. A meeting of the early shareholders/founders of Ecobank.

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14 12 Board and Management Reports Group Chairman s statement shape the future of pan-african banking, thereby creating unprecedented opportunity and value for our customers, employees and shareholders alike. We also consider ourselves to have been pioneers within the African banking sector in terms of the adoption of international best practice. So, the fact that management and corporate governance issues have dominated the headlines about Ecobank over the past year is a matter of deep regret. On behalf of the Board, I wish to convey our sincerest apologies to all our stakeholders that, of late, we have not always lived up to our own high standards in terms of business practice and transparency. The Board is committed to establishing the highest standards of corporate governance... we will learn from the past, address all of the issues and lay firm foundations for Ecobank s continued success in the next 25 years. I consider it a great honor to have the, albeit unexpected, privilege of reporting to you on Ecobank s progress in 2013, our silver anniversary year. This represents a significant milestone in the life of any company, but particularly so for an organization which has become such a vital part of the banking and commercial life of Middle Africa. The past 25 years have proved to be an incredible journey, not least in terms of our growth from humble beginnings to becoming the leading pan-african bank, with more than US$22 billion of assets, revenue in excess of US$2 billion and more than 1,200 branches in 35 countries across our continent. For, when Ecobank started out, nobody had a mobile phone, letters were being written with typewriters and correspondence was sent by post. Our strategy of leveraging technology to drive product and service innovation has been a hallmark of Ecobank s success over the years and it will continue to be a key component in our mission to Given that Ecobank has more than doubled in balance sheet size over the past five years, these are the almost inevitable growing pains associated with accelerated business expansion. Nevertheless, the Board takes corporate governance very seriously hence our decision to commission leading practitioners, such as the International Institute for Management Development and Ernst and Young (EY), to carry out independent reviews of our practices. We also welcome the open and constructive dialogue that we have had, and will continue to have, with the regulators of each of the three West African exchanges on which Ecobank Transnational Incorporated (ETI) is listed. As a result of these interactions, we have instituted a detailed governance action plan to strengthen our ability to meet these challenges going forward, as well as measures to improve our systems and internal controls. Such a comprehensive refresh of our corporate governance should assure our stakeholders of the seriousness of our intent. Environment Our marketplace, Middle Africa, continues on its robust growth trajectory. According to the International Monetary Fund, GDP growth for the region is expected to rise to 6% this year, from 5% in 2013, ranking second only to developing Asia in terms of its pace of development. The larger economies of Nigeria, Ghana and Kenya are witnessing rapid economic growth, with substantial gains in the banking and financial services sectors. Elsewhere, growth has been particularly buoyant in resource-rich

15 Board and Management Reports 13 countries, including the Democratic Republic of Congo and Sierra Leone. Improved political stability and security have led to economic recovery in the likes of Mali and Côte d Ivoire. Thanks to regulatory reforms, urbanization, the expanding middle class and advances in technology, the prospects for Africa s banking sector remain highly attractive. According to Ernst and Young, at current growth rates, the financial services sector could make up around 20% of the continent s collective GDP within the next decade, compared with 10% today. Significant growth opportunities remain in both the retail and wholesale sectors that will allow Ecobank to create significant shareholder value in the longer term. Financial results Despite a challenging operating environment in 2013, Ecobank registered impressive organic growth in terms of both revenues and assets. Revenue broke through the US$2 billion mark, whilst strong growth in both customer loans and deposits led to a 13% year-on-year increase in total assets to US$22.5 billion. Our continued focus on efficiency across our diversified platform is bearing fruit, with the cost-to-income ratio improving in each of our six geographical clusters in Africa. However, the 2013 results have been impacted by our conservative decision to take a one-off US$165 million provision against certain legacy non-performing assets in Nigeria. This led to a 34% decline in pretax profit to US$222 million in comparison with 2012 and a 48% decline in net profit to US$148 million. As our parent company, Ecobank Transnational Incorporated, generated no distributable earnings in 2013, we are unable to propose a dividend payment for the financial year in review. Board and management changes Mr Kolapo Lawson stepped down as Group Chairman in October and retired from the Board at the end of 2013, after more than 20 years of dedicated service. During this period, he was instrumental in bringing into fruition his father s and the other founding members vision of a genuinely African private sector bank. On behalf of the Board, employees and shareholders, I should like to express our appreciation to Kolapo for his entrepreneurial spirit, leadership and unwavering commitment to Ecobank. In addition to the departure of Mr Thierry Tanoh as CEO, three of the Group s nonexecutive directors (Dr Babatunde A.M. Ajibade, Mr Paulo Gomes and Mr Isyaku Umar) resigned their Board positions during the first quarter of On behalf of the Board, I should like to thank them all for their valued contributions and wish them well in their future endeavors. In line with a directive from the Securities and Exchange Commission of Nigeria, Mrs. Laurence do Rego has been reinstated to the position of Group Executive Director of Finance and Risk. We also recently announced the co-option of Hewitt Benson as a non-executive director. He will be the Board representative for Asset Management Corporation of Nigeria (AMCON), which currently holds a 10.4% equity interest in ETI. As a result of these changes, Ecobank s Board currently comprises five executive officers and eight non-executive directors. At our recent EGM, shareholders agreed to limit the size of the Board to a maximum of 15. Our new Search Committee (which includes two former chairmen, honorary president Gervais Djondo and Chief Philip Asiodu, two current Board members and three shareholder representatives) has been charged with finding a permanent Chairman with the banking industry stature and experience to reinvigorate the Board and ensure that Ecobank s strategic direction is implemented effectively. The reconstituted Board should also reflect Ecobank s cultural diversity, with a more balanced gender and professional mix. The Search Committee will also recommend potential new Board members for shareholder approval at the Annual General Meeting, to be held in June. Appreciation On behalf of the Board and all of our stakeholders, I wish to express a sincere vote of thanks to Mr Albert Essien for taking the helm at Ecobank. With a wealth of African banking and management experience and having been a loyal servant to the Group for over 20 years, we believe there is no-one better qualified to lead Ecobank at this stage. He has the business acumen, integrity and, indeed, passion, to re-establish Ecobank as the proud and successful institution it always has been and always will be proved to be a testing year for everyone associated with the Group. We were particularly struck by the forbearance and rectitude of Ecobank s staff. On behalf of the Board, I thank everyone for their efforts and encourage you all to embrace the undoubted challenges ahead with renewed confidence and vigor. For, make no mistake, we need to work in unison to restore Ecobank s world-class reputation and regain the trust of our customers, partners and investors. Outlook The Ecobank spirit, which took the Group from a small bank in the 1980s in Togo to one of Africa s largest financial institutions today, is one of resilience and determination. Fundamentally, all of our people are galvanized around the simple but ambitious goal of building a world-class, pan-african operation. The Board is committed to establishing the highest standards of corporate governance that enable effective decision-making, with clear responsibilities. We will learn from the past, address all of the issues and lay firm foundations for Ecobank s continued success in the next 25 years. André Siaka Interim Chairman

16 14 Board and Management Reports Directors report Ecobank Transnational Incorporated (ETI), the parent company of the Ecobank Group, is a bank holding company. Its principal activity is the provision of banking and financial services through its subsidiaries and affiliates. Business review During 2013, we continued to focus on the delivery of our key strategic pillars, namely providing an outstanding customer service experience to our clientele, improvement of long-term shareholder value and return as well as being the employer of choice in the markets where we operate. In 2013, South Sudan was added to the Group s network of banking operations while a representative office was also opened in Addis Ababa, Ethiopia, bringing the number of presence countries to 39. A detailed review of the business of the Group during the 2013 financial year is contained in the Business and Financial Review section of this report. Acquisitions and divestitures The bank did not undertake any acquisitions during We divested certain non-core assets, including majority stakes in the Life Assurance and General Insurance businesses of the former Oceanic Bank, both sold to Old Mutual. We also sold majority stakes in Oceanic Health and Oceanic Homes. Results The Group s profit after tax stood at US$148 million. Net profit attributable to the parent company was US$96 million. The details of the results for the year are set out in the consolidated financial statements. The Board of Directors approved the financial statements of the Company and the Group for the year ended 31 December 2013 at the meeting of the Board held on 25 April Messrs André Siaka and Albert Essien were authorized to sign the accounts on behalf of the Board. International Financial Reporting Standards The accounts of both the parent company and the Group are prepared in accordance with International Financial Reporting Standards (IFRS). For 2013, the Group has classified certain businesses as held for sale in line with IFRS 5 (non-current assets held for sale and discontinued operations). We have therefore restated our 2012 financials on the same basis to facilitate year-on-year comparisons (refer to note 29 of our financial statements in this report for more detail). Dividend The directors do not recommend the payment of a dividend, given that the parent company made a loss for the year Capital The authorized share capital of the Company is US$1.277 billion, divided into 50 billion ordinary shares of 2.5 US cents per share and 1.07 billion preference shares of 2.5 US cents. At the beginning of 2013, there was a total of billion ordinary shares in issue. During the year, there was no change in the number of shares in issue. The ordinary shares of the Company are traded on the three West African stock exchanges, namely the BRVM (Bourse Régionale des Valeurs Mobilières) in Abidjan, the Ghana Stock Exchange of Accra and the Nigerian Stock Exchange of Lagos. Directors The names of the directors of the Company appear on pages of this Annual Report. As of 31 December 2013, the Board was composed of 17 directors: 11 non-executive and 6 executive directors. The Board of Directors met eight times during the year. The Governance Committee, the Audit and Compliance Committee and the Risk Committee each met four times to deliberate on issues under their respective responsibilities. On 29 October 2013, Mr Kolapo Lawson stepped down as Chairman, with the Vice-Chairman, Mr André Siaka, taking over as interim Chairman of the Board of Directors on the same date. Mr Lawson retired from the Board on 31 December 2013 and the Board would like to thank him for his considerable service to the Group since its founding. On 6 August 2013, Laurence do Rego, Group Executive Director for Finance and Risk, was suspended by the Board and did not play a further part in Board activities for the remainder of She was subsequently reinstated on 11 March Corporate governance and compliance There has been considerable focus on the Group s corporate governance practices, particularly at the Board level, this year. Following a series of publications in the local and international media from July 2013 regarding alleged breaches of corporate governance and allegations against the Board of Directors and certain principal officers of the Company, the Securities and Exchange Commission (SEC) Nigeria undertook an independent review of these allegations through the professional services firm KPMG. The purpose of the review was to ascertain the Company s compliance with the SEC s Corporate Governance Code as well as best practice and also to determine the veracity of the various allegations against principal officers of the Company. The Group also commissioned IMD and EY to conduct

17 Board and Management Reports 15 independent reviews of our corporate governance and assist with responding to regulatory reviews. Following the SEC/KPMG review, an Extraordinary General Meeting of shareholders was held on 3 March 2014 to approve a 51-point Governance Action Plan designed to address the areas highlighted by the SEC/KPMG. The Company maintains corporate policies and standards designed to encourage good and transparent corporate governance, avoid potential conflicts of interest and promote ethical business practices. These policies are being updated where relevant as part of the above plan, and further details are provided in the Corporate Governance Report on page 66 of this report. The Board and the Group are committed to improving the governance of the institution and are working closely with regulators and other stakeholders to rebuild confidence in this area. Subsidiaries In 2013, the Group extended its African operations by opening an affiliate in South Sudan and a representative office in Addis Ababa, Ethiopia. This completes our coverage of the East African Community (EAC) cluster. Our investment banking subsidiary, Ecobank Development Corporation, has also opened an office in Kenya, adding to its operations in Ghana, Nigeria, Côte d Ivoire and Cameroon. Responsibilities of Directors The Board of Directors is responsible for the preparation of the financial statements, which give a true and fair view of the state of affairs of the company at the end of the financial period and of the results for that period. These responsibilities include ensuring that: Adequate internal control procedures are instituted to safeguard assets and to prevent and detect fraud and other irregularities Proper accounting records are maintained Applicable accounting standards are followed Suitable accounting policies are used and consistently applied The financial statements are prepared on a going concern basis unless it is inappropriate to presume that the Company will continue in business. Independent External Auditors The Joint Auditors, PricewaterhouseCoopers, Lagos, Nigeria and PricewaterhouseCoopers, Abidjan, Côte d Ivoire have indicated their willingness to continue in office. A resolution will be presented at the 2014 AGM to authorize the directors to determine their remuneration. Dated in Lomé, 30 April 2014 By Order of the Board, eprocess International SA, our shared services and technology subsidiary, continued to provide the technology infrastructure and platform for the Group. ETI has a majority equity interest in all its subsidiaries and provides them with management, operational, technical, training, business development and advisory services. Samuel K. Ayim Company Secretary Post balance sheet events There were no post balance sheet events that could materially affect either the reported state of affairs of the Company and the Group as at 31 December 2013 or the profit for the year ended on the same date which have not been adequately provided for or disclosed.

18 16 Board and Management Reports Board of Directors Evelyne Tall Deputy Group Chief Executive Officer, Group Chief Operating Officer, Senegalese 2 André Siaka Interim Chairman Cameroonian 3 Albert Essien Group Chief Executive Officer Head of Corporate and Investment Bank Ghanaian 4 Patrick Akinwuntan Group Executive Director, Head of Domestic Bank Nigerian 5 Eddy Ogbogu Group Executive Director, Operations and Technology Nigerian 6 Laurence do Rego Group Executive Director, Finance Beninese

19 Board and Management Reports Bashir Mamman Ifo Non-executive Director Nigerian 8 Kwasi A. Boatin Non-executive Director Ghanaian 9 Assad J. Jabre Non-executive Director French 10 Daniel Matjila Non-executive Director South African 11 Sipho Mseleku Non-executive Director South African 12 Sena Agbayissah Non-executive Director French Other directors as at 31 December 2013* Kolapo Lawson Thierry Tanoh Isyaku Umar Babatunde A.M. Ajibade Paulo Gomes * Not pictured and no longer directors of Ecobank Group

20 18 Board and Management Reports Directors biographies Kolapo Lawson (63) Chairman 2009 to 2013 Non-Executive Director from 1993 to 2013 Nigerian André Siaka (64) Interim Chairman since October 2013 Non-Executive Director since 2006 Cameroonian Thierry Tanoh (51) Group Chief Executive Officer during 2013 Ivorian Kolapo Lawson is the Chief Executive Officer of a diversified industrial and trading group with operations in the United Kingdom and West Africa. He is the Chairman of Acorn Petroleum Plc and Agbara Estates Limited, as well as a Non-Executive Director of three publicly quoted companies: Beta Glass Plc, Pharma- Deko Plc and Sovereign Trust Insurance Plc. He was a Director of Ecobank Nigeria from 1989 to 1997 and of Ecobank Togo from 1990 to He stepped down as Chairman of the Ecobank Group in October 2013 and resigned from the board effective 31 December Kolapo Lawson has a degree in Economics from the London School of Economics and Political Science and is a Fellow of both the Institute of Chartered Accountants in England and Wales and the Institute of Chartered Accountants of Nigeria. André Siaka is a Director on the Board of SA Brasseries du Cameroun (SABC). He was the Chief Executive Officer of SABC from 1988 to January He worked with SABC from 1977, rising from Production Engineer to Plant Manager, Deputy Regional Manager, Regional Manager and Deputy Managing Director. Before joining SABC, André Siaka worked with Société Générale in Paris from 1974 to André was Vice-Chairman of the Board from 2009 until he was made interim Chairman in October André Siaka is a member of the Financial Markets Commission and a Director of Orange Cameroun and Chanas Assurances SA. He holds an engineering degree from École Polytechnique, Paris. André Siaka has recently been appointed as the Honorary Consul for the Monaco Principality in Douala. Thierry Tanoh joined the Ecobank Group as CEO designate in July Mr. Tanoh was Group CEO during the year 2013 and left the Company in March, Thierry Tanoh joined Ecobank from the IFC, a member of the World Bank Group and a global financial institution that supports private sector development in developing countries. During his 17-year career with the IFC, Mr. Tanoh played a key role in expanding the latter s investment activity in Sub-Saharan Africa from US$140 million in 2003 to more than US$3.5 billion in During this time, his responsibilities included business development, deal structuring and processing of some of IFC s largest transactions, before taking on a broader management role. He joined IFC in 1994 through the young professional program. He initially worked in the Asia Department. He then specialized in the chemicals and petrochemicals sector, working on transactions in Asia, Latin America and Eastern Europe. He became Regional Director in 2006 and Vice President, Latin America and the Caribbean, Sub- Saharan Africa and Western Europe in An Ivorian national, he graduated from Ecole Supérieure de Commerce d Abidjan. He is a certified public accountant in France and holds a Masters in Business Administration from the Harvard Business School.

21 Board and Management Reports 19 Albert Essien (58) Group Chief Executive Officer since March 2014 Head of Corporate and Investment Bank Ghanaian Evelyne Tall (55) Deputy Group Chief Executive Officer since 2012 Group Chief Operating Officer Senegalese Patrick Akinwuntan (51) Executive Director since 2012 Head of Domestic Bank Nigerian Albert Essien was made Group CEO in March 2014, having been a Deputy Group CEO since He has been a Group Executive Director since He is also the Head of Corporate and Investment Bank. Prior to that, he was the Regional Head for the Anglophone West Africa (excluding Nigeria) and the Eastern and Southern Africa (ESA) regions. As Regional Head for ESA, he had responsibility for Ecobank s expansion into that region. He started his banking career in 1986 with the National Investment Bank in Accra, Ghana and joined the Corporate Banking Department of Ecobank Ghana in In 1997, he became Country Risk Manager. He was appointed Deputy Managing Director in 2001 and became Managing Director in December Albert Essien has a degree in Economics from the University of Ghana (graduating in 1979) and is an alumnus of the Executive Development Program of INSEAD (France/ Singapore). He is also an honorary fellow of the Chartered Institute of Bankers, Ghana. Evelyne Tall is currently Deputy Group CEO and Group Chief Operating Officer. She oversees the banking subsidiaries and affiliates of ETI across Africa and the Group s Internal Control, Customer Service and Compliance functions. Prior to that, she was the Head of Domestic Bank. She has been a Group Executive Director since She started her banking career in 1981 with Citibank in Dakar. She left Citibank to join Ecobank Mali as Deputy Managing Director in 1998, and was made Managing Director in Evelyne Tall was later transferred to Ecobank Senegal as Managing Director. She was appointed Regional Head of the Francophone West Africa Region in October Evelyne Tall holds a Bachelor s degree in English (Dakar) and a diploma in International Trade, Distribution and Marketing from the Ecole d Administration et de Direction des Affaires (ex EAD), Paris. Patrick Akinwuntan is the Head of Domestic Bank, responsible for the retail, local corporate, public sector and microfinance businesses of the Group. Since joining Ecobank in 1999, he has held various Group management roles, including Group Head, Domestic Bank Products, Group Executive Director, Operations, Technology, Transaction and Retail Banking and Managing Director of eprocess International, where he spearheaded the establishment of the Ecobank Pan-African Technology and Shared Services Centre in Accra, Ghana. Between 2001 and 2005, he was Executive Director, Retail banking for Nigeria and from 1999 until 2001, Group Chief Financial Officer. Patrick has also been Group Coordinator, Commercial Banking and Zonal Head, Western II at Ecobank Nigeria between 1996 and Before joining Ecobank, he worked for Ernst and Young, Manufacturers Merchant Bank and Springfountain Management Consultants in Nigeria. He holds an MBA (Finance Option) from the Obafemi Awolowo University, Ile Ife, Nigeria. He is a Fellow of the Institute of Chartered Accountants of Nigeria and an Associate of the Chartered Institute of Taxation of Nigeria. He is also an alumnus of the Harvard Business School s Senior Executive Program.

22 20 Board and Management Reports Directors biographies Laurence do Rego (49) Executive Director since 2010 Head of Finance Beninese Eddy Ogbogu (52) Executive Director since 2012 Head of Operations and Technology Nigerian Sena Agbayissah (51) Non-Executive Director since 2011 French Laurence do Rego was appointed Group Executive Director, Finance and Risk in January 2010, having previously been the Group Chief Financial Officer from 2005 to Following separation of the Finance and Risk functions in April 2014, she assumed the role of Group Executive Director, Finance. She joined Ecobank in 2002 as Head of Financial Control for Ecobank Benin. Prior to this, Laurence do Rego had over 15 years of experience in senior financial roles, including being Financial Director at Binney & Smith, France, a subsidiary of the Hallmark Group (USA),and Group Thoer (France), and Managing Director of SOCIEC (Societe d Expertise Comptable), an accountancy firm in France. Laurence do Rego holds a bachelor and postgraduate degrees in Finance and Accounting. Eddy Ogbogu has been the Group Executive responsible for Operations and Technology since August A seasoned operations professional, he has worked in senior banking operations and technology management roles for more than a decade in different organizations covering multiple geographies in Africa. Before his current appointment, he worked with Bank PHB Plc in Nigeria where he was an Executive Director, heading the bank s service organization, with responsibility for Operations and Technology, including administrative services. Prior to this, Eddy Ogbogu had an illustrious 19-year career at Citibank in different African countries. He was appointed the Senior Country Operations Officer for the Citibank franchise in Nigeria in 2005 after similar roles in Tanzania, Zambia and Kenya and also served as a Board Director. Eddy was also responsible for overseeing Citibank s operations and technology in the West Africa cluster. He is an Accountancy graduate and holds a professional ACA qualification of ACA. He is a member of the Institute of Chartered Accountants of Nigeria (ICAN), the Nigeria Institute of Management (NIM), an Honorary Fellow of the Nigeria Institute of Bankers (NIB) and active in charitable societies. Sena Agbayissah is a qualified French lawyer and a partner at the law firm of Hughes Hubbard & Reed LLP in Paris. He began his career at Landwell (Pricewaterhouse), where he became a partner in His experience includes: project finance, securities issuance, financial and banking transactions, structured financing, derivatives, banking and financial regulations and group restructurings. He is also an expert in carbon trading. Sena Agbayissah is a member of the Board of Directors of the European Association for Banking and Financial Law. He is a lecturer in financial law at Rennes University for DJCE (Diplôme de Juriste Conseil d Entreprise) students, at Montpellier University and at University of Paris XI. He holds a DEA (Diploma of advanced studies in private law), University of Paris XI; a DJCE and DESS (postgraduate degrees in business law), University of Rennes and an advanced diploma in taxation ( Certificat d Etudes Supérieures ), University of Montpellier.

23 Board and Management Reports 21 Babatunde A M Ajibade (46) Non-Executive Director from 2010 to February 2014 Nigeria Kwasi A Boatin (52) Non-Executive Director since 2009 Ghanaian Paulo Gomes (49) Non-Executive Director from 2006 to January 2014 Bissau Guinean Babatunde Ajibade is engaged in private commercial legal practice and is a Senior Advocate of Nigeria. He has been the Managing Partner of SPA Ajibade & Co, a leading commercial legal practice in Nigeria, since He is the Chairman of the Capital Market Solicitors Association, Nigeria; Vice-Chairman of the Banking, Finance and Insolvency Committee of the Nigerian Bar Association s Section on Business Law; Vice-Chairman of the Rules and Regulations Sub-Committee of the Nigerian Securities and Exchange Commission s Capital Market Committee; a Fellow of the Institute of Advanced Legal Studies (UK); and an International Practice Fellow of the International Bar Association. Babatunde Ajibade holds a PhD in Private International Law and an LLM in Corporate and Commercial Law, both from King s College, University of London, and an LLB from the Obafemi Awolowo University, Ile-Ife, Nigeria. Kwasi Boatin is an experienced investment and asset management consultant and asset management consultant and former Director General of the Social Security and National Insurance Trust (SSNIT), with US$2.1 billion of assets under management for a defined benefit plan under the Social Security Scheme for Ghana. He was the General Manager in charge of Finance of SSNIT from 2003 to In February 2006 he was appointed Reporter by the International Social Security Association (ISSA), under the ILO, Geneva, and was Vice-Chairperson of the Technical Commission on Investments from 2007 to From 1989 to 2003 he held senior finance positions in major UK companies including Barratt London Plc, AT&T (UK) and Winkworth. Kwasi Boatin holds an MBA from Henley Business School, Oxfordshire, England and is a Fellow of the Association of Chartered Certified Accountants, UK. Paulo Gomes was an Executive Director of the World Bank Group in Washington DC from 1998 to From 1995 to 1998, he worked for the Ministry of Finance, Planning and Trade of Guinea-Bissau, where he was Principal Adviser, Director of Strategic Planning, Public Investment and Debt. Paulo Gomes is the Founder and Manager of Constelor Holdings and Chairman of the AFIG Fund. He holds a Certificate in Political Studies (Institut d Etudes Politiques de Paris), a Bachelor in Economics and International Trade (Institut d Etudes Libres de Relations Internationales,Paris) and Masters in Economic Policy and Management from the Kennedy School of Government at Harvard (USA).

24 22 Board and Management Reports Directors biographies Bashir M Ifo (54) Non-Executive Director since 2011 Nigerian Assaad J Jabre (61) Non-Executive Director since 2010 French Dr. Daniel Matjila (51) Non-Executive Director since 2012 South African Bashir Ifo is the current President of the ECOWAS Bank for Investment and Development (EBID), formerly known as the ECOWAS Fund for Cooperation, Compensation and Development in Togo. He has 30 years of experience in both the public and private sectors. Between 1995 and 2011 he held several senior management positions at EBID. These included Head of Financial Operations Division, Director of Treasury Department, Head of Finance and Administration Department, Acting Managing Director of the former ECOWAS Regional Investment Bank (ERIB) and Vice President for Finance and Corporate Services. From 1982 to 1995, Bashir Ifo worked in both the public and private sectors in Nigeria. He holds a Bachelor s degree in Business Administration (Banking and Finance) and an MBA (Finance), both obtained from the Ahmadu Bello University, Zaria, Nigeria. Assaad Jabre is a Corporate Investment Advisor. From 1980 to 2005, he worked with the International Finance Corporation (IFC), a member of the World Bank Group, where he held a number of senior positions, including: Acting Executive Vice-President and Chief Executive Officer (2005); Vice-President, Investments and Advisory Operations ( ) and Vice-President, Portfolio Management ( ). From 1997 to 2005 he was also a member of the IFC Corporate Investment Committee and its Finance and Risk Management Committee. Mr Jabre currently sits on the advisory board of ICD, the private sector affiliate of the Islamic Development Bank; the strategic committee of Agence France-Tresor, the French sovereign debt management agency; and the board of the GSMA foundation a foundation established by the association of worldwide mobile telecom operators. He is a Graduate of the Institut d Etudes Politiques de Paris and holds a degree in International Law from the University of Paris and an MBA from the Wharton School (University of Pennsylvania). Dr Daniel Matjila is a well-respected and experienced finance, investment risk management and investment specialist. He is also an academic. Currently, he is the Chief Investment Officer (CIO) and Executive Director of the Public Investment Corporation (PIC). PIC is the largest asset manager in South Africa and the rest the African continent. He manages an investment portfolio in excess of R1.1 trillion (approx. US$150 billion) across all asset classes. He is also spearheading the offshore investment strategy and Africa investment strategy for the PIC. He is also currently a Non-Executive Director and Board member at Afrisam Ltd, Entabeni Holdings (Chairman) and Harith Partners. Prior to joining the PIC, he was the Senior Manager Quantitative Research Analysis for Stanlib, where he spearheaded the application of quantitative techniques in fund management and managed the Quant Portfolio for over two years. Before this, Dr Matjila worked for Anglo American, a JSE-listed company, for five years where he was the Senior Manager of Quantitative Research Analysis, responsible for Derivatives (Fixed Income, Equity and Currency) and the application of quantitative techniques in Fund Management. Dr Matjila started his career as a Senior Mathematics lecturer at the University of the North working in academia for over nine years. He holds a Ph.D. (Wits), a M.Sc. (Rhodes) and a B.Sc. Hons (Fort Hare), amongst other qualifications.

25 Board and Management Reports 23 Sipho G Mseleku (47) Non-Executive Director since 2009 South African Isyaku Umar (66) Non-Executive Director from 2006 to February 2014 Nigerian Sipho Mseleku is the Chairman of the Global Business Roundtable; he is the former Chief Executive Officer of the Association of SADC Chambers of Commerce and Industry (ASCCI), a Non-Executive Chairman of Sakhumnotho Group Holdings (Pty) Ltd amongst numerous other executive roles. He was the Chief Executive Officer of the Chambers of Commerce and Industry of South Africa (CHAMSA) from 2004 to 2005, of the National African Federated Chamber of Commerce and Industry (NAFCOC) and Sakhumnotho Group Holdings (Pty) Ltd from 2002 to Sipho Mseleku has a background in investment banking, structured finance and legal practice. He is an Attorney of the High Court of South Africa and the current President of the Pan-African Chamber of Commerce and Industry. Isyaku Umar started his career with UAC of Nigeria. From 1972 to 1976, he worked for Kano State Government and was at various times Secretary of the Draught Relief Committee and Principal Private Secretary to the Military Governor. Following that, he became the General Manager of Mai-Nasara and Sons Limited from 1977 to 1979, and Managing Director of Tofa General Enterprises Ltd from 1979 to date. Isyaku Umar holds a Bachelor s degree in Economics from Ahmadu Bello University, Zaria, a Master of Public Administration degree from Pittsburgh University (USA) and an Honorary Doctorate Degree from Nnamdi Azikiwe University Awka Anambra State, Nigeria. He holds an LLM (Tax Law), an HDip Company Law, an LLB and a BA (Hons) of the University of Witwatersrand, Johannesburg.

26 24 Board and Management Reports Group Chief Executive s review Together with my experienced executive and senior management team, the leadership rhythm of the institution has been re established. Delivering value for our shareholders is critical we know that we have to improve our cost-to income ratio and generate better returns from our pan African network. To have the opportunity to lead Ecobank is most humbling, and in taking on the role I appreciate the support and trust of the Board and our major shareholders. This responsibility comes at a challenging time given recent governance issues, but the fundamentals of our business are strong and I am excited about the huge potential of our unique platform, built over the past 25 years. I have already begun the essential groundwork of reassuring our staff, shareholders, regulators, depositors and other customers of Ecobank s organizational and financial stability. Together with my experienced executive and senior management team, the leadership rhythm of the institution has been re-established. This is essential to ensure our staff work together towards a common goal. Demonstrating this stability and unity of purpose amongst Ecobankers allows confidence to be restored, and shows our stakeholders that the Group is back to business as usual. The resilience of our institution has been tested during the governance crisis and we have come out stronger. Whilst 2013 was a particularly challenging year, the underlying financial results are testament to Ecobank s strong franchises across Africa and excellent products and services. Robust organic growth of 16% took net revenue to over US$2 billion for the first time and we increased our balance sheet during the year. The decision to make full provision for legacy assets in Nigeria was a prudent one. I recognize that the lack of a dividend this year will be a disappointment to our many shareholders, but the Board is committed to paying a dividend for Delivering value for our shareholders is critical we know that we have to improve our cost-to-income ratio and generate better returns from our pan-african network. We are driving efficiencies within both our retail and wholesale businesses and are seeing the benefits of operational synergies from our major acquisitions in Nigeria and Ghana. Our return on equity is set to improve as Nigeria delivers to its full potential, our newer geographical clusters (notably East and Southern Africa) gain appropriate scale and our focus on operational efficiencies across the Group feeds through to improved profitability. We have made a very promising start to 2014, which gives me confidence in Ecobank s ability to deliver a much-improved performance for the current financial year. Financial Performance Overall, despite the regulatory headwinds in Nigeria, we achieved most of the financial targets that we set out at the start of On the balance sheet side, we saw good opportunities to grow risk assets, particularly in the regional corporate business. Our net customer loans increased by 21% during the year to over US$11 billion, exceeding our target of approximately 10% growth. Customer deposits grew by 13% to US$16.5 billion and whilst we did not reach our