On the Ghana Stock Exchange (GSE,) Ecobank Ghana Limited [EGH], in its recent earnings report recorded an approximate growth of 17% in Total Revenue for 2016FY; Total Revenue increased from GHS1,025,765,000 in 2015 to GHS1,201,168,000.
Interest Income of the company also increased by 12.12% to GHS 878,914,000 in 2016FY.
Despite the 23.17% rise in Interest Expense during the period under review, Net Interest Income went up marginally by 7.03%; from GHS 655,432,000 in 2015FY to GHS 701,477,000 in 2016FY.
Net trading Income generated during the period however fell by 6.1% to GHS 129,934,000. Net fees & Commission Income also went down by 15.16% during the period to GHS 157,270,000. Operating Income of the bank equally dipped by 0.84%; from GHS 461,523,000 in 2015FY to GHS 457,186,000 in 2016FY. Net Profit of SCB dipped slightly by 0.59%; from GHS 327,523,000 in 2015FY to GHS 325,594,000 in 2016FY.
During the 52 weeks period, EGH grew its loan book size by 42.06% at the same time deposits from customers also grew by approximately 58%. Total Asset increased by 21.83% to GHS 8,025,510,000 in 2016 while Total Liabilities also increased by 23.95% to GHS 7,073,302,000. Earnings per share [EPS] attributable to shareholders went down from GHS 112 in 2015 to GHS 111 in 2016. Non-Performing Loans [NPL] ratio however decreased from 18.01% in 2015 to 11.90% in 2016; this gives a clear indication that the bank successfully minimized the exposure of its loan portfolio to credit risk during 2016.
The improvement in EGH fundamentals is a solid backbone for the current share performance streak on the bourse. The dip in NPL ratio is also a good indication to stakeholders that the bank has been efficient in minimizing bad loans on its books despite the huge legacy debt within the industry as a result of BDC loans. EGH has so far recorded YTD capital gains of 12.03%, the equity is a BUY on the back of projected strong growth in earnings this year which will further boost the share performance of the company.
Trading activity on the bourse ended with 2 gainers [GOIL and SOGEGH] and 1 loser [GGBL] yesterday. GGBL topped the trading chart in terms of volume as 2,000,000 shares worth GHS 3,000,571.00 changed hands. Returns on the Composite and Financial Stock Index pegged at 10.64% and 14.34% respectively.
Trading activity on the Ghana Alternative Market [GAX] was hushed as no shares changed hands.
HORDS currently lead record capital gains on the GAX, appreciating by 25% from 2016 year open.
The Cedi Gained marginally to the British pound and Euro but Lost to the Dollar yesterday.
The local currency exchanged at a mid-rate of GHS 4.5038 to the USD, GHS 5.5309 to the GBP and GHS 4.7349 to the EURO.
The GCFM Cedi index, a measure of the holistic performance of the Cedi on the inter-bank market now records a year-to-date depreciation of 6.94%.
By GN Research