The Pan African banking group Ecobank Transnational Incorporated end the first nine months of the year 2015 with positive net income of $305.66 million, a figure which however registers a decrease of 5% compared to the performance of this indicator, achieved during the same period in 2014 ($324.45 million)

"The operating environment in sub-Saharan Africa has been difficult during the period. However, in spite of the impact of different factors on our financial performance, the strength of our model of diversified Pan African business has allowed us to have a positive result." commented Ade Ayeyemi (pictured), the CEO of the group, thus putting this under-performance in perspective.

Therefore, in spite of an increase of 3% in the net interest margin to $837.8 million, the net banking income of the Pan African group decreased by 3% to $1.59 billion, strained by a fall of 12% in fees and commissions which represent an important part of the group's revenues, at $433.4 million. Moreover, ETI, during the period, faced an increase of 22% in provisions for financial assets.

While recognising the effect of operational losses and the appearance of provisions in the third quarter, Mr. Ayeyemi attributes this fall in performance to the effects of loss in exchange rates in the different countries of operation, and the macroeconomic situation in the region. "We continue to foresee the strong constraints of the current economic downturn and we anticipate 2015 results well below projections, but relatively stable at constant dollar exchange rate", he declared.

Behind this mixed picture, appears more positive news. If the results valued in US dollars are in decline, it is not so for the same indicators expressed in the currencies of the two principal countries where the group is listed on the stock exchange, namely the BRVM in Abidjan and the Nigerian financial market.

The results expressed in Naira or CFA francs, bring to light rather positive performance, with an increase of GDP at 25% in naira and 17% in CFA francs. By the same logic, the net income in these two cases show an increase of 15% and the net earnings per share remain virtually unchanged.

The effect of this positive change in the results appear as a handicap when referring to the exposure of the group to contingent liabilities concerning bank-issued letters of guarantee, endorsements and sureties, letters of credit and commitments to extend unfunded credits. In US dollars, these show a fall to $4.9 billion as at 30 September against $5.1 billion at the same period in 2014. In FCFA or naira, these figures are up sharply.

On the Nigerian Stock Exchange, the share price has stabilised these past 7 days to around 18 nairas but is having difficulty reaching the level of 19 nairas of the beginning of the month of October. On the BRVM, ETI remains a very attractive share and its value lost 1.82% at the end of the closing session of 27 October 2015. In Johannesburg where its principal shareholder Nedbank is listed, the share value of the latter posted a loss of 1.19% at the opening of the market this 28 October 2015. It is however difficult to establish a direct connection with the interim results of ETI.

Idriss Linge