By Bamidele Famoofo
To further drive the economy of Africa, Pan African Bank, Ecobank Bank Group, increased its lending portfolio to $12.5 billion, adding $2.0billion in first quarter period ended March 31, 2026.
Non-performing loans (NPL), however, stood at $1.2billion in the review period, representing 9.5 percent of total gross loans, up 71 percent year-on-year.
The Group disclosed that the increase in NPL loan was mainly due to an increase in NPLs in Nigeria as part of prudent measures to exit the Central Bank of Nigeria’s (CBN) forbearance regime in 4Q25.
The Group’s strong first quarter performance was driven by revenue growth In both CIB and CCB, cost efficiency, diversification benefits, and focused execution of its GTR Strategy.
Highlights of the accounts showed that profit before tax (PBT) was $195m, up 21 percent YoY. Attributable profit to the shareholders of ETI of $93m, up 11 percent, with EPS at $0.0038 (0.38 US cents). Tangible book value per share (TBVPS) of $0.077 (7.73 US cents), increased 65 percent YoY. Return on average assets (ROA) of 1.6%; Return on average tangible equity (ROTE) of 19.5 percent. Net revenue of $636m, up 23 percent, with 38.7 percent of revenues generated from stable, recurring non-interest revenues. Payment revenue was up 18 percent to $78m (12% of net revenues), driven by an 18 percent increase in disbursements (wholesale payments) to $38m, 7 percent growth in card-related fees to $23m, and a 64 percent increase in merchant solutions fees to $6.9m. The Group’s value of digital transactions increased by 54 percent, to $25.7bn, while volumes grew 2 percent to approximately 57m during the quarter. Cost-to-income (CIR) stood at 49.0 percent, down from 51.6 percent in 1Q25.
The Group’s capital position remains sound, with estimated Group Common Equity Tier 1 (CET1) and Total Capital Adequacy Ratio (CAR) ratios of 13.4 percent and 16.8 percent as of 31 March 2026. These figures are approximately 486 and 429 basis points (bps) above the regulatory minimums.
Jeremy Awori, CEO of Ecobank Group, stated that “Ecobank’s first-quarter results were strong, showcasing significant growth in deposits, an increase in net interest margin, efficiency improvements from transformation initiatives, and robust business momentum. The deepening of client relationships and enhanced digital engagement led to a $5.0 billion year-on-year increase in customer deposits, resulting in an 11% rise in earnings per share to 0.34 US cents. A 49 basis points decrease in the cost of funding to 2.3% contributed to a 30 basis points expansion in the net interest margin. Additionally, over the past three consecutive quarters, we have generated positive operating leverage and achieved a cost-to-income ratio of 49.0% in the quarter, an improvement from
51.6% in the prior year quarter. Despite a challenging operating environment characterised by the war in the Middle East and turmoil in energy and global financial markets, we successfully navigated these challenges by prioritising our customers’ financial needs. These results reflect the resilience of Ecobankers, our diversified pan-African business model, growth across our business lines, and our disciplined execution of the Growth, Transformation, and Returns (GTR) strategy.
We continue to invest in our people, products, processes, digital capabilities, and partnerships to remain competitive and relevant for our customers. In Corporate and Investment Banking (CIB), we focused on client excellence and growth by expanding our wealth and asset management services and enhancing our international operations. In Consumer and Commercial Banking (CCB), we continued to invest in broadening our range of products and solutions, which led to successfully onboarding more customers digitally, driving primary banking relationships (the primary customer base grew 13%), boosting the value of digital transactions by 54% to $25.7 billion during the quarter, and increasing new card issuances by 5%. We remain confident in our strategy and the opportunities to differentiate our capabilities and provide exceptional service to our clients,” concluded Awori.
Other Key Highlights.
• Ample liquidity buffers with a loan-to-deposit ratio of 47.2 percent (1Q25:49.0%) and a loan-to-asset ratio of 35.6 percent (1Q25:36.5%), reflecting Ecobank’s capacity to support credit origination for our clients.
• Reserves for expected credit losses (ECL) of $1.0bn, increased 64 percent YoY, and were 8.1 percent (1Q25:5.9%) of total loans, positioning the balance sheet for emerging risks. These reserves include approximately $649m of accumulated ECLs.
Profit after tax attributable to shareholders of ETI increased $9 million, or 11 percent (down 10 percent in constant currency), to $93 million during the first quarter of 2026, compared with the prior year period, reflecting an increase in impairment charges, partially offset by revenue growth in each of our business lines and cost efficiency gains.
Profit before tax increased by $20 million, or 12 percent (a decrease of 5 percent in constant currency), to $195 million during the first quarter of 2026, compared with the prior year period. In the Corporate and Investment Banking (CIB) business, profit before tax rose by $21 million to $163 million (not adjusted for consolidation), primarily driven by effective balance sheet management and higher trading fees within Global Markets. In Consumer and Commercial Banking (CCB), profit before tax was flat at $92 million (not adjusted for consolidation) during the first quarter of 2026, compared with the prior-year period, primarily due to lower client-driven foreign-currency sales in the UEMOA region, driven by regulatory-driven foreign exchange (FX) liquidity constraints. Under CCB, the Consumer segment’s profit before tax increased by $2 million, while the Commercial segment’s profit before tax declined by $ 2 million.
Net revenue (the sum of the net interest income (NII) and non-interest revenue (NIR)) increased by $120million, or 23 percent (+8% in constant currency), to $636 million during the first quarter of 2026, compared to the prior year period. CIB net revenues rose by $85 million to $347 million, strongly driven by treasury management and trade. In CCB, net revenues increased by $27 million to $296 million, with the Consumer banking segment revenues growing by $15 million to $141 million, supported by deepening customer engagements, increased lending activity, and higher deposit-related fees from an increase in deposits, and the Commercial banking segment growing by $12 million to $155 million, underpinned by strong customer deposit growth, trading activity, payments, and lending to Small and Medium-Enterprises (SME).
Net interest income, NII (the difference between interest income earned on interest-earning assets and interest expense incurred on interest-bearing liabilities), increased by $95 million, or 32 percent (+14% in constant currency), to $390 million during the first quarter of 2026, compared to the prior year period. The increase was driven by a $106 million increase in interest income, partially offset by a $12 million increase in interest expense. Compared to the first quarter of 2025, net interest margin (NIM) increased by 30 basis points to 5.9 percent. These increases were driven by modest loan growth and higher balances in treasury securities. The relatively modest increase in interest expense reflects a successful strategy of shifting the deposit mix towards low-cost CASA deposits, which led to a 49 basis-point decrease in the average interest rate paid on interest-bearing liabilities to 2.3 percent during the first quarter of 2026, compared to 2.8 percent in the prior-year period. CASA deposits as a percentage of total customer deposits rose to 88.3 percent in the first quarter of 2026 from 85.6 percent in the prior year period.
Non-interest revenues, NIR, increased by $26 million, or 12 percent (flat in constant currency), to $246 million during the first quarter of 2026. Net fees and commissions income increased by $24 million to $153 million, supported by cash management and credit-related fees. Additionally, fees derived from net trading income and foreign exchange gains increased by $4 million to $87 million, driven by treasury management actions, but were significantly offset by lower fees generated from client-driven foreign currency sales due to regulatory-driven FX liquidity constraints in the UEMOA region. Other income also decreased by $2 million to $6 million.
Operating expenses increased by $45 million, or 17 percent (3% in constant currency), reaching a total of $312 million in the first quarter of 2026 compared to the same period last year. Staff costs rose by $17 million to $133 million, primarily due to higher employee compensation and benefits. Additionally, other operating expenses climbed by $26 million to $160 million, driven by statutory tax-related and legal expense accruals.
The cost-to-income ratio, which indicates the efficiency of the company’s operations, improved to 49.0 percent, down from 51.6 percent in the same period last year. This improvement was driven by higher revenue growth than operating expenses.
Pre-provision, pre-tax operating profit (PPOP), which is net revenues minus operating expenses, a key metric for assessing the bank’s earnings power, increased by $75 million, or 30 percent (+13% in constant currency), to $324 million, reflecting solid revenue momentum and prudent cost management.
Income taxes were $52 million for the first quarter of 2026, largely unchanged from the prior year period. The effective tax rate (ETR) was 26.9 percent versus 30.0 percent in the prior year period.
Gross impairment charges on loans and advances (the amount of income set aside to cover potential credit losses in the loan book) increased by $111 million during the first quarter of 2026, to $174 million, compared to the prior year period, and the cost-of-risk (CoR) increased by 175 basis points to 3.54 percent. This increase reflects higher impairment charges in the Commercial Banking credit portfolio and incremental centrally accumulated ECL reserves to address potential emerging portfolio risks during the quarter. The amount of loans recovered, including reserves released from previously set-aside impairment charges, was $62 million during the first quarter of 2026, compared with $16 million in the prior-year period, reflecting continued aggressive loan remediation and recovery efforts. Conversely, impairment charges on other assets, excluding loans and advances, were $18 million, compared with $28 million in the prior year period.
Loans and advances to customers (gross) increased by $2.0 billion year-on-year, or 19 percent (+9% in constant currency), to $12.5 billion as of 31 March 2026. In the UEMOA region, gross loans increased $293 million (down $13 million in constant currency), driven by a decrease in corporate and trade loans.
In Nigeria, loans decreased by $61 million (or $239 million in constant currency), reflecting management’s strategic decision to reduce lending while addressing legacy asset quality issues and pursuing its regulatory-compliant capital restoration plan. In the AWA region, loans increased by $635 million ($320 million in constant currency), driven by growth in Guinea and Ghana. Finally, the CESA region recorded gross loan growth of $827 million ($696 million in constant currency), mainly from commercial lending. In CIB, loans grew by $1.1billion to $8.6 billion, driven by trade loans, while in CCB, loans were up $805 million to $3.9 billion, driven by loans to women-led businesses (Ellevate Programme) and digitally enabled loans.
Customer deposits increased by $5.0 billion ($2.8 billion in constant currency) to $26.5 billion as of 31 March 2026. In CIB, deposits increased by $1.9 billion to $11.2 billion, driven by deepening client relationships and ongoing success with customer accounts planning. CCB deposits rose by $3.2 billion to $15.3 billion, driven by growing primary banking relationships, particularly in CESA and AWA. Overall, customer deposits are stable and diversified, with the proportion of ‘sticky’ and low-cost CASA deposits as a percentage of total customer deposits rising to 88.3% in the first quarter of 2026 from 85.6% in the prior year period. This improvement reflects management’s continued efforts to optimise the deposit mix and reduce reliance on higher-cost funding sources. As a result, it helped to reduce the cost of funding to 2.3% during the first quarter of 2026 from 2.8% in the prior year period.
Non-performing loans (NPLs):
As of 31 March 2026, NPLs totalled $1.2 billion, representing 9.5% of total loans. This compares with $1.2 billion, or 9.4%, as of 31 December 2025, and $693 million, or 6.6%, as of 31 March 2025. The year-on-year increase in NPLs is due to the one-time reclassification of certain legacy exposures within our Nigeria portfolio in the fourth quarter of 2025. This change reflects a deliberate normalisation of our balance sheet following the end of the regulatory forbearance period in Nigeria. We have since implemented a prudent and proactive provisioning strategy, maintaining a strong coverage ratio of 85.6% as of the first quarter of 2026, up from 83.3% at 31 December 2025, as we pursue recovery.
Accumulated impairment charges for expected credit losses (ECL) increased by $397 million ($350million in constant currency), bringing the total to $1.0 billion as of 31 March 2026, compared to $618million in the prior year period. The current period’s AECL includes centrally accumulated ECLs of $649million, built over time to address potential emerging risks within the portfolio, including specific risks related to Nigeria. As a result, the total end-of-period ECL reserve build as a percentage of gross loans has significantly improved, climbing from 5.9% in the first quarter of 2025 to 8.1 percent at the end of the current period.
As of 31 March 2026, the Group’s equity attributable to ETI shareholders was $1.94 billion, a 62 percent year-on-year increase, driven by profit attributable to ETI shareholders of $93 million for the quarter and favourable foreign currency translation gains over the period due to US dollar weakness versus key African currencies.
As of 31 December 2025, the Group’s capital adequacy ratios indicate that the CET1 ratio is 13.2 percent, Tier 1 Capital is 13.9 percent, and the Total CAR is 16.8 percent. As of 31 March 2026, those estimates improved to a Group CET 1 ratio of 13.4 percent, Tier 1 capital of 14.0 percent and total CAR of 16.8 percent. The strong CAR position is primarily attributed to profit growth and a positive net impact from foreign currency translation reserves
(FCTR). The surplus above the regulatory minimum for 31 March 2026 CAR ratios is approximately 486basis points for CET1, 448 basis points for Tier 1 CAR, and 429 basis points for Total CAR.
Regional Performance:
Francophone West Africa (UEMOA)
UEMOA’s profit before tax for the first quarter of 2026 decreased by $6 million, or 7 percent (or down 17 percent in constant currency), to $71 million compared to the prior year period. Annualised ROE was 18.7 percent for the quarter.
Net revenues increased by $11 million, or 7 percent (or down 4% in constant currency), to $177 million, compared to the prior year period. Net interest income increased by $28 million ($16 million in constant currency) to $134 million, supported by a significant increase in government securities balances, modest loan growth, and margin expansion. Non-interest revenues decreased by $16 million (or $23 million in constant currency) to $43 million, with an 18 percent increase in fees and commission income offset by a 123 percent decrease in fees from foreign-currency sales, largely driven by the adverse impact of regulatory-driven foreign-exchange liquidity constraints.
Operating expenses increased by $12 million, or 14% (+3% in constant currency), to $92 million, reflecting higher staff and incentive compensation expenses, other tax-related costs, card and SWIFT internet costs, an business promotion costs. The cost-to-income ratio was 52.0%, compared to 48.6 percent in the prior year period.
Impairment charges on financial assets were $14 million, an increase of $5 million from the prior year period, reflecting higher impairment charges in CCB.
Nigeria
Nigeria reported a profit before tax of $4 million for the first quarter of 2026, flat year-on-year but down 9 percent in constant currency compared to the prior-year period. The decrease was predominantly due to an increase in impairment charges on loans in the current quarter. Annualised ROE was 3.7 percent compared to 6.1 percent in the prior year period.
Net revenues increased by $16 million, or 46 percent (+32% in constant currency), to $50 million. The increase was primarily driven by a $11 million ($9 million in constant currency) rise in net interest income to $35million and a $5 million ($4 million in constant currency) increase in non-interest revenue to $15 million. Treasury management solutions largely drove growth in net interest income, while non-interest revenues rose due to higher cash management income.
Operating expenses increased by $2 million, or 9 percent (down 1% in constant currency), largely due to stringent cost management. The cost-to-income ratio improved significantly to 56.0% in the first quarter, down from 74.6 percent in the prior year period, as revenue growth outpaced expense growth.
Impairment charges on financial assets increased by $13 million, or 290 percent (+253% in constant currency), to $18 million. This sharp rise was due to higher ESL reserve build within CIB’s credit portfolio.
Anglophone West Africa (AWA)
AWA reported a profit before tax of $111 million in the first quarter of 2026, an increase of $36 million, or 48 percent (+25% in constant currency). Annualised ROE for the quarter was 29.1 percent compared with 30.9 percent in the prior year period.
Net revenues grew by $36 million, or 24 percent (+2% in constant currency), to $185 million. Net interest income rose by $21 million (down $2 million in constant currency) to $118 million, with underlying growth adversely impacted by net interest margin compression from a lower interest rate environment. Non-interest revenues increased by $15 million ($7 million in constant currency) to $67 million, primarily from higher client-driven foreign currency trading, partially offset by a regulatory-driven reduction in card fees in Ghana.
Operating expenses increased by $4 million, or 7 percent (down 14% in constant currency), to $68 million, largely due to enhanced cost discipline, partially offset by increased staff costs, incentive compensation and accruals for legal-related expenses. Consequently, the cost-to-income ratio improved to 36.5 percent, down from 42.6 percent in the prior year period, as revenue growth outpaced expense growth.
Impairment charges on loans and financial assets decreased by $4 million, or 39 percent (down 52 percent in constant currency), to $6 million in the first quarter. This decline resulted from a $12 million increase in loan recoveries, which offset an $8 million increase in gross impairment charges
Central, Eastern and Southern African Region (CESA)
CESA, our best performing region, reported a profit before tax of $127 million, an increase of $34 million, or 36 percent (+26% in constant currency). Annualised ROE improved to 33.8%, an improvement from 30.8 percent in the prior year period.
Net revenues increased by $50 million, or 28 percent (+18% in constant currency), to $231 million. Net interest income increased by $32 million, or 33 percent (+23% in constant currency), to $130 million, driven by growth in lending across business lines and higher trade loans in the commercial sector. Non-interest revenues increased by $18 million, or 22 percent (+12% in constant currency), to $102 million, primarily due to increased fees from client-driven foreign currency sales in Commercial banking, higher card and deposit-related fees from an increase in transaction volumes in the Consumer business.
Operating expenses increased by $18 million, or 23 percent (+13% in constant currency), to $99 million, driven mainly by staff-related compensation accruals and tax expenses. The cost-to-income ratio improved to 42.6 percent in first quarter of 2026, down from 44.4% in the prior year period, reflecting positive operating leverage. Impairment charges on financial assets decreased by $1 million, or 19 percent (down 28% in constant currency), to $6 million.
