Ecobank Malawi has more than doubled its after-tax profit to K18.1 billion in the year ended December 31 2022 from the previous year’s K8.2 billion, despite the tough operating environment characterised by forex shortage and rising inflation.
A summary of audited financial statements published yesterday showed that operating income increased to K45 billion from last year’s K29.8 billion largely due to growth in interest-earning assets.
The statement jointly signed by the bank’s managing director Raymond Fordwuo and board chairperson Symon Msefula said despite operating costs increasing by 25 percent to K14.1 billion from the previous year’s K11.3 billion on account of inflationary pressures caused by 25 percent devaluation of the kwacha in May 2022, the bank maintained a positive balance between revenue and operating expenses.
This, the bank said resulted in an improved cost to income ratio of 31 percent, a rise from last year’s 38 percent.
Reads the statement in part: “Businesses of most of our customers were negatively affected by forex shortages and rising cost of doing business which resulted in inability to service their facilities.”
During the year under review, Ecobank Malawi total asset increased by 52 percent from K349 billion to K531 billion mainly buoyed by increase in customer deposits and deposits from other banks.
The statement further showed that the bank’s loan book jumped by 52 percent to K52 billion from last year’s K34 billion, pushed up what the bank said was increased facilities to key economic sectors.
“The sustained growth underscores the resilience of the bank arising from our leadership position in trade finance, the digitisation of our products and services, operational efficiency and excellence in delivery of our customer-centric services,” reads the bank’s statement.
The bank has cited Tropical Cyclone Freddy which hit most of the districts in the Southern Region, continued forex shortages, high inflation rate currently at 26.7 percent and high interest rates as challenges to the economy, whose growth is expected to be revised downwards from 2.7 percent.