Photo | courtesy.
Ecobank Transnational Incorporated (ETI) has announced that it will not pay dividends to its 641,000 shareholders for the 2024 financial year, despite reporting record revenues exceeding Sh258.5 billion (US$ $2 billion) and a return on equity of 32.7 percent.
The pan-African lender, headquartered in Lomé, reported Sh75 billion (US$ $333 million) in attributable earnings, but its board opted to channel all profits into reinforcing the bank’s balance sheet. According to Board Chair Papa Madiaw Ndiaye, the decision was made to maintain covenant headroom and fund future growth.
“Servicing our obligations and building resilience in our capital position must take precedence. It’s a long-term play to fuel the bank’s ability to scale responsibly,” Ndiaye told investors during the Annual General Meeting.
ALSO READ: Safaricom to Invest Sh66 Billion in AI Infrastructure Across East Africa
Shareholders, including more than 600,000 retail investors who rely on dividend payouts for regular income, initially expressed discontent. However, all resolutions, including a new funding mandate, were ultimately approved during the AGM.
Group Chief Executive Officer Jeremy Awori defended the strategy, noting that regulatory expectations and market volatility across the bank’s 35-country footprint demand a stronger Tier-1 capital buffer.
“This isn’t about denying value to shareholders. It’s about ensuring we remain stable and are positioned for accelerated, sustainable growth. We’re already seeing the benefits of this discipline across trade finance and digital consumer banking,” said Awori.
The bank has Sh1.27 trillion (US$ $9.8 billion) in outstanding loans on its books. It plans to use the retained earnings to support expansion in trade finance, cross-border payments, and its fast-growing digital mortgage and wealth management platforms.
Awori said that the group’s Growth, Transformation, and Returns (GTR) strategy remains on track, and that dividends may resume in 2026 once capital optimization targets are met.
“If we reinvest today to build the rails for tomorrow, the returns will be even more meaningful,” he added.
Ecobank’s decision signals a wider shift among African banks from dividend signaling to balance sheet fortification, especially as institutions prepare for the rollout of Basel III requirements, navigate currency volatility, and respond to growing credit demand under the African Continental Free Trade Area (AfCFTA).
