Ecobank Nigeria Ltd. has repaid $150 million, representing 50 percent of its $300 million 7.125 percent Eurobond due February 2026, reinforcing its liquidity position and commitment to balance sheet optimisation.
The early redemption, completed on July 8 through a tender offer and exit consent process, comes amid signs of improving cash flow driven by increased loan recoveries and early settlement of promissory notes from its parent company, Ecobank Transnational Incorporated.
The notes were trading near par before the buyback, underscoring investor confidence in the lender’s credit fundamentals.
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In addition to the partial repayment, bondholders approved the removal of a capital adequacy ratio (CAR) covenant linked to the bond. The covenant was triggered in 2024 when Ecobank Nigeria’s CAR declined to 7.65 percent, below the regulatory threshold of 10 percent for national banks.
The drop was attributed to the naira’s sharp devaluation, which affected the bank’s foreign currency-denominated asset base.
The bank said it is implementing a recovery plan focused on profit growth, tighter cost controls, and capital injections from its parent to restore CAR to compliant levels.
The move is part of a wider transformation strategy that includes aggressive provisioning, asset quality clean-up, and operating efficiency gains.
Preliminary results for the first half of 2025 show revenue rose 30 percent year-on-year to N113.7 billion, while profit before tax jumped 90 percent to N13.5 billion. Impairment charges increased to N32.8 billion, reflecting the bank’s effort to front-load provisioning and strengthen its loan book.
The lender said it has activated an “asset quality war room” to drive recoveries, particularly in its oil and gas exposures, which have seen improved performance amid sector reforms and rising production.
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Despite macroeconomic headwinds, Ecobank Nigeria’s liquidity ratio remains well above the regulatory minimum of 30 percent, bolstered by prudent treasury operations and conservative lending.
Ecobank said it intends to redeem the remaining $150 million of the Eurobond at maturity in February 2026, barring unforeseen market shifts.
The early repayment marks a strategic step in reducing debt service pressure while sending a signal of financial resilience to the market.
Analysts say the move reflects proactive liability management in a volatile environment, with liquidity management emerging as a key competitive differentiator for banks in Nigeria.
