Ecobank Nigeria— a subsidiary of pan-African lender Ecobank Transnational Incorporated— has redeemed half of its $300 million Eurobond due February 2026, nearly seven months ahead of schedule.
This move was supported by an aggressive loan recovery drive and improved liquidity.
The early repayment, which took place on July 8, 2025, was part of the bank’s tender and exit consent solicitation for its 7.125% senior notes.
The bond, issued in February 2021 and listed on the London Stock Exchange, had been trading near par at $99.00 as of July 11—an indicator of investor confidence in the bank’s ability to meet its financial obligations.
According to a statement issued by the bank, one of the key enablers of the repayment was its focused loan recovery and restructuring strategy, led by a dedicated asset quality unit known internally as the “war room.”
The unit helped recover significant amounts in the first half of 2025, including $6 million from a long-standing delinquent client.
In addition, over $111 million (₦170 billion) in loans that had previously been classified as Stage 2 (high risk of default) have now been upgraded to Stage 1, reflecting improved repayment performance.
The lender’s improved cash flow was also helped by the early settlement of promissory notes by its parent company.
Ecobank’s efforts to clean up its balance sheet and improve capital buffers come as its capital adequacy ratio (CAR) slipped to 7.65% in 2024, below the 10% regulatory minimum for national banks.
The decline was largely attributed to naira depreciation, which weakened the value of the bank’s foreign currency loan portfolio.
In response, Ecobank sought and secured bondholders’ consent to remove the CAR covenant from the Eurobond agreement. The bank has also launched a broad transformation programme targeting revenue growth, cost control, and operational efficiency.
Early financial results show signs of improvement.
The lender posted a 30% year-on-year growth in revenue in the first half of 2025, rising from ₦87.6 billion ($57 million) in H1 2024 to ₦113.7 billion ($73.4 million).
Profit before tax jumped even more sharply, climbing 90% to ₦13.5 billion ($87 million), up from ₦7.1 billion ($46 million) in the same period last year.
The bank’s liquidity ratio remained well above the 30% regulatory threshold, underscoring strong short-term solvency.
However, gross impairment charges surged by over 200% to ₦32.8 billion, reflecting more aggressive provisioning.
Last year, the parent company injected over $10 million to help the Nigerian subsidiary meet the Central Bank of Nigeria’s ₦200 billion ($130.7 million) minimum capital requirement for national banks.
Further capital injections and internal measures—including reduced risk-weighted assets, higher retained earnings, and improved profitability—are expected to restore the Capital Adequacy Ratio to regulatory levels.
Ecobank also said it will comply with the central bank’s forbearance directive by withholding dividends and management bonuses in the near term to preserve capital.
The lender remains confident in its ability to fully repay the remaining 50% of the bond by its original maturity date in 2026.
Analysts view the early bond redemption as a positive signal of the bank’s resilience and improving fundamentals.
NB:The financial figures were converted from naira to U.S dollars using the exchange rate ₦1,529/$1 as of July 18, 2025.
