ETI Boss Assures Shareholders of High Returns

The Group Chief Executive Officer of Ecobank Transnational Incorporated (ETI), Mr. Ade Ayeyemi last Friday said the bank remained committed to creating shareholders’ value by ensuring that its cost-on-equity is lower than return-on-equity going forward.

Addressing stockbrokers during the presentation of the bank’s “Facts behind the figures” at the Nigerian Stock Exchange (NSE) in Lagos, Ayeyemi said: “As we recognise places that generate returns below cost of capital, we need to take action. If we don’t take action, then we are not good custodians of assets that were given to us.”

He explained that the bank would invest where it has sustainable competitive advantage in order to capture more market share across the African continent.

According to him, the bank would re-visit its operational strategy in the high potential markets, while considering constructive exit from low potential markets.

“Our aspiration in Kenya, for instance, is not to be one of the top three because we don’t actually have to be one of the top three to win in Kenya. If we can get return-on-equity higher than cost-on-equity in that market, our system will be better. We want to look at Kenya as the fulcrum through which we hold the whole Central, Eastern and Southern Africa and we believe that if we could do that, we will get an economic of scale.

“Now, there are certain markets where we need to revisit our investment strategy. Like we said, it is about the form of presence and the form of presence because the technology, innovation these days and telecommunication just allow us to be able to participate in the market not all along the day, but if we can participate in the market electronically and with technology, it will make it possible for us to connect with customers and people that are buying and selling for various purposes. It does give us enough advantage and that is what I mean when I say that we will revisit our investment strategy,” he said.