Africa's top lenders from 2017.

 
 
 
 
 
 
     

Algeria, Citi Algeria

Despite the difficulties posed by lower commodity prices, Algeria’s 2016 economic performance was relatively resilient. Nevertheless, the challenges that the country continues to endure are significant. Current account and fiscal deficits have grown in recent times, while the government has introduced a number of regulatory initiatives that have negatively impacted the fortunes of the country’s banks. These include new import licences for construction material and consumer products as well as reductions to the foreign obligation to regulatory capital ratio, among others.

In this environment, Citi Algeria has once again scooped the country award. Above all, the judges were impressed with the bank’s commitment to customer service in challenging circumstances. In addition, the bank’s efforts to support community development and financial inclusion initiatives were also praised. 

In terms of the numbers, Citi Algeria’s return on equity remained relatively stable at 13% in 2016, down from the 14% registered in the previous year but up from the 12% recorded in 2014. In 2016, its cost-to-income ratio was constant year on year at 35%. Asset growth in 2016 hit 10% in local currency terms, although net profits and Tier 1 capital both fell by 6% and 5%, respectively. 

Citi Algeria’s commitment to social development saw the bank partner with Enactus, a global non-profit entity focusing on entrepreneurial action, to develop the employability and skills of 1500 young people in the country by 2018. This same programme is also being rolled out in two other Maghreb countries. 

“Under an increasingly competitive environment, Citi in Algeria has been standing out as we have been able to strengthen our operations, to efficiently serve our clients with world-class products and to grow our market shares at a time where market is shrinking,” says Ramz Hamzaoui, chief executive of Citibank Algeria. 

Angola, Standard Bank Angola

The winner of this year’s Angola country award, Standard Bank Angola, has gone from strength to strength in recent times. A return on equity of 49% in 2016 was accompanied by a cost-to-income ratio of 59%, representing a massive reduction from the 71% registered at the end of 2014. 

In local currency terms, net profits surged over the 2016 review period with an increase of 50%, while assets jumped by 23% and Tier 1 capital rose by 60%. These achievements have come despite the bank operating in the market for only seven years as of 2017. 

“Standard Bank Angola celebrated seven years in operation in the Angolan market this year. The main challenge of setting up a new business in a foreign market with strong entrenched competitors has been access to skills and the creation of a unique Standard Bank Angola culture in the market,” says Antonio Coutinho, chief executive of Standard Bank Angola. 

Over the past 12 to 15 months, Standard Bank Angola has invested heavily in processes designed to improve its customer service proposition. This includes improvements to its payments workflow, covering the automation of tasks and reducing the turnaround times, as well as the implementation of a new internet platform for private banking and commercial clients, among other improvements. “[We have refocused] the business on being a far more customer-centric business, [which was] achieved through the creation of a dedicated senior executive position,” says Mr Coutinho. 

On the personal and business banking front, Standard Bank Angola is driving forward with a multi-channel digital development strategy. This focuses on six key principles, including digital security, branch digitisation and new product development, among others.

Benin, Bank of Africa Benin

Benin’s economic performance has remained relatively robust despite a more challenging regional economic environment in recent years. The International Monetary Fund expects full-year gross domestic product growth of 5.4% in 2017. But serious challenges still exist, ranging from the impact of cooling economic fortunes of larger neighbours to a changing domestic political environment. This has required the country’s banks to be adaptable, innovative and forward thinking. 

The winner of the 2017 country award, Bank of Africa Benin has displayed all three of these qualities in abundance. 

“In the past year, Bank of Africa Benin has faced [a number of] challenges, [including] the large-scale slowdown of economic activities due to the economic downturn in Nigeria, Benin’s main economic partner. [In addition], there has been a slowdown in private domestic and foreign investment due to the 2016 election and the change of the government,” says Faustin Amoussou, managing director of Bank of Africa Benin. 

Despite these difficulties, the bank registered impressive growth numbers across all key performance indicators. In local currency terms, net profits surged by 29% in 2016, while assets and Tier 1 capital increased by 9.7% and 6%, respectively. Return on equity, meanwhile, grew to 21.4% from 18.4% in the previous year. 

Over the past 18 months, Bank of Africa Benin has taken a number of steps to improve its position in the market. This includes the introduction of a pricing task force to conduct market research on bank pricing in order to set competitive pricing for its own services, as well as a ‘customer first’ programme to improve the customer experience. 

“[Over the next year] we will develop products and services for real estate and home loans, consumer and home appliance loans, a customer loyalty programme and a proprietary solution for mobile banking,” says Mr Amoussou. 

Botswana, FNB Botswana 

Botswana’s economic growth is slowly recovering from the lows of recent years, as an improving outlook in the mining and services sectors helps to spur a wider recovery across the country. In turn, this is providing the country’s banks with a more positive growth trajectory. The winner of the 2017 country category, FNB Botswana, impressed the judges based on its customer-centric approach to growth, as well as its solid financial performance. 

Over the review period, the bank saw its assets increase by 4%, while Tier 1 capital grew by 10%. Though net profits decreased, FNB Botswana’s return on equity hit 20% and its non-performing loan ratio sat at a comfortable 3%. Looking ahead, the bank intends to pursue its overarching customer-centric strategy to achieve increased growth. This includes four strategic initiatives that cover the extraction of maximum value from the current business, by streamlining business processes, deploying more products from the group level (FirstRand), leveraging strategic partnerships and diversifying revenue streams. 

In terms of innovative new offerings, FNB Botswana launched its eBucks rewards programme, which helps customers to earn as they bank. Under eBucks, qualifying customers are rewarded when they use pre-paid airtime or pre-paid electricity through the bank’s electronic channels. In addition, the bank’s private clients can earn up to 1.5% back in eBucks through credit card transactions. 

Meanwhile, FNB Botswana’s multi-channel growth strategy continues at pace. This includes the development of a new digital offering known as the Integration Race that will see the bank integrate its systems with government, private companies and para-statals to facilitate access to new services. 

“Behind our customer-centricity strategy is the digital migration, and effort to encourage our customers to utilise our digital service platforms which are more convenient and cost-effective for them,” says Steven Lefentse Bogatsu, chief executive of FNB Botswana.

Burkina Faso, Orabank

Things are looking up for Burkina Faso. The country registered gross domestic product growth of 5.9% in 2016, up from 4% in 2015 according to the World Bank. Despite rising insecurity across the wider region, the government’s investments in public infrastructure, coupled with an expanding mining sector, underline the brighter outlook for Burkina Faso relative to some of its regional peers. These improvements are having a tangible impact on the country’s banks and the winner of this year’s country award, Orabank Burkina Faso, is no exception. 

“Burkina Faso is presenting glimmers of hope with positive events such as the normal functioning of all the institutions of the republic and the start of the PNDES, Burkina Faso’s strategic plan for growth. We are confidant Burkina Faso will grow steadily in the coming years,” says Martial Goeh-Akue, managing director of Orabank Burkina Faso.

This is the first time that Orabank has scooped the country award for Burkina Faso. The judges were impressed with the bank’s excellent financial performance over the review period, as well as its investments in digital banking. Over the review period, Tier 1 capital increased by 29% in local currency terms, while assets and net profits both surged, by 58% and 35%, respectively. More encouraging still, Orabank’s return on equity hit 34% in 2016, up from 32% in the previous year, as its cost-to-income ratio fell to 59% from 66%. 

This truly impressive financial performance was achieved in tandem with a number of investments in the bank’s digital capacity. In 2016, the bank implemented a new banking system called ‘Sopra Amplitute Banking’. This new software promotes automated transaction processing while offering multi-channel availability 24/7 to offer customers a wide range of services. “It facilitates the production of statistics and [enable us] to meet the challenge of digitalisation,” says Mr Goeh-Akue. 

Cameroon, Ecobank Cameroon 

The winner of the 2017 Cameroon country award, Ecobank Cameroon, emerged as the standout entry in a competitive category. The bank’s return on equity surged to 50% over the 2016 review period, up from 44% in the previous year. Net profits, meanwhile, increased by 18% as Tier 1 Capital grew by 5%. This performance was achieved with a cost-to-income ratio of 58% and a non-performing loan ratio of 3.9%. 

The judging panel was particularly impressed with the bank’s approach to customer service and the various innovations that it has introduced in the market. This includes the launch of the Ecobank mobile app, the first mobile app in Cameroon, which permits customers to check their balance, pay bills and transfer money anywhere, any time. The introduction of Masterpass QR allows the bank’s corporate clients to better manage their cash by receiving instant payment alerts, while on the retail side, customers can pay merchants by scanning and validating a QR code on their mobile phones.

Meanwhile, the introduction of the lender’s Rapid-Transfer Online service gives all Ecobank customers the opportunity to execute cross-border transfers through the bank’s website. 

Other market-shaping innovations have also helped to spur the bank’s growth. This includes the launch of instant card and PINs for customers in the branch, as well as the introduction of pre-paid cards for both account and non-account holders to capture a larger segment of the unbanked population. 

Indeed, Ecobank’s efforts to promote financial inclusion have seen its agency banking model deploy pre-paid card offerings and remittances products throughout some of Cameroon’s most remote regions. For these reasons, and others, Ecobank comfortably secured the 2017 country award. 

Chad, United Bank for Africa Chad 

Chad’s economic growth has cooled in recent years as the twin challenge of regional insecurity and lower oil prices have taken their toll on the country’s prospects. The International Monetary Fund expects gross domestic product growth of just 0.6% in 2017. But it is not all doom and gloom for the country’s banks. Indeed, the winner of this year’s country category, United Bank for Africa Chad (UBA Chad), has gone from strength to strength of late. 

Between 2014 and 2016, the lender’s return on equity climbed from 11% to 19%, just as its cost-to-income ratio fell from 76% to 66%. Meanwhile, in local currency terms, the bank saw its net profits surge by 105% in 2016 following a marginal contraction the previous year. Assets growth also jumped considerably, reaching 70% over the review period. 

UBA Chad’s success in a difficult market is a testament to the strength of its growth strategy. The bank has prioritised the diversification of its lending activities to the most resilient sectors of the economy. In particular, UBA Chad has targeted the massive development opportunities presented by intra-African trade initiatives which in turn has generated multiple revenue streams, including foreign exchange and fee-related incomes. 

Over the review period, UBA Chad also upgraded its core banking system, from Finacle 7.0 to Finacle 10. This has helped to increase the bank’s service delivery to support its rapidly growing retail business across the country. In the growing retail sector, the bank has a country-wide network of branches that act in tandem with an after sales service delivered through various e-channels designed to improve and ease the overall customer experience. 

Democratic Republic of the Congo, Trust Merchant Bank 

Recent times have not been kind to the Democratic Republic of the Congo (DRC). Political instability and the lingering impact of lower commodity prices have hit the country’s economic fortunes hard; the value of the Congolese franc has slumped, inflation has spiked and economic growth has cooled. In these circumstances, the country’s banks have suffered. But the winner of the 2017 country award, Trust Merchant Bank (TMB), impressed the judges based on its unique strategy, financial inclusion initiatives and commitment to investing in its capabilities during a challenging time. 

“Despite the broader environment, TMB has achieved a number of successes during the past year. Chief among these is a partnership agreement with the Congolese Post Office which will see TMB provide banking services at post offices across the country, with a particular focus on remote areas. A wholesale redevelopment of the bank’s IT infrastructure, critical to providing for ongoing sustainable growth, has been another major success of the year,” says Oliver Meisenberg, chief executive of TMB. 

Indeed, TMB’s partnership agreement with the DRC’s post office will offer the bank a number of unique advantages. For one, it will expose the lender to hundreds of thousands of potential new clients across the country. But it will also help to diversify TMB’s revenue sources, loan portfolio risk and liquidity position. Under the terms of the partnership, the bank will initially restore 60 post office locations out of a total network of 350. 

Meanwhile, TMB’s progress in the digital banking space is progressing swiftly. “With Pepele Mobile, our revolutionary mobile banking product, we can say with some confidence that TMB is owning the fintech revolution here in the DRC,” says Mr Meisenberg. 

Djibouti, Exim Bank Djibouti 

Exim Bank Djibouti enjoyed a strong year in 2016, mirroring the economic conditions in a country that grew by about 6.5% over the period. Net profits at the bank surged, hitting $2m, which was an increase of 259% from the previous year. Total assets and Tier 1 capital increased by 76% and 74%, respectively, while the bank’s cost-to-income ratio fell drastically over the same period from 77% to 58%. As a newer entrant in Djibouti’s banking market, this performance was deeply impressive.

“The main challenge in the past year was to build the [bank’s] name and the market’s confidence in an industry predominantly dominated by two major players with a large market share and historic background,” says Jacky Kayiteshonga, country managing director for Exim Bank Djibouti. 

The lender’s strategy is to focus on high-performing sectors of the economy with the objective of banking the entire value chain of each targeted segment. This includes large corporates, key suppliers and corporate clients, employees and other stakeholders. 

Exim Bank Djibouti will continue this approach over the coming year as it broadens its clientele base to include major commercial houses ranging from cargo transit partners, fast-moving consumer goods groups, free zones and public institutions. In a mark of its growing role in Djibouti’s banking market, the lender participated in the financing of fibre optic cable network for the country’s national telecoms operator. 

“The success over the past years from our ability to understand the peculiarities of the market we are playing in and tactically delivering products and services that fit our client base. Continuous interaction with our clientele, availability, expertise and knowledge of our human capital are the key drivers of our success story,” says Mr Kayiteshonga.

Egypt, Arab African International Bank 

Arab African International Bank’s (AAIB’s) eye-catching list of recent achievements is impressive. But it was the lender’s 179% increase in net profits in 2016 that best sums up its country award-winning performance. This was the highest increase in the Egyptian banking industry and builds on already impressive 38% growth in net profits in 2015. This was accompanied by a 75% increase in assets and a 170% jump in Tier 1 capital. 

The judging panel was also impressed with AAIB’s improving return on equity, which reached 18.2% in 2016, up from 15.6% in 2014, as well as its cost-to-income ratio, which was 19.9% over the review period. 

“We achieved the highest increase in profit in the Egyptian banking sector while we ensured the growth of our clients in Egypt and the region. At the same time, AAIB expanded its client base to include a new segment, small and medium-sized enterprises, in addition to extending [our microfinance offering],” says Hassan Abdalla, chief executive of AAIB. 

Beyond the numbers, AAIB’s various business initiatives captured the attention of the judges. These include the bank’s new partnership with the Suez Canal Economic Zone, in which it became the first lender in the country to sign a deal covering banking services, financial consultancy and the funding of mega-projects. In addition, AAIB is currently upgrading its core banking system to Temenos T24, which will improve its system architecture, operational activities and system security and control, among other features. 

Meanwhile, AAIB’s outlook remains bright. “Opportunities lie ahead in catering to international investors targeting Egypt, the Gulf and Africa. There is also growth potential in funding mega-projects that are currently booming in Egypt,” says Mr Abdalla. 

Equatorial Guinea, Banco Nacional de Guinea Ecuatorial 

As is the case in other oil-producing countries in the Gulf of Guinea, Equatorial Guinea has struggled to adapt to a lower global price environment. With hydrocarbons dominating the national economy, the outcome has been heightened fiscal and external imbalances and cooling growth. Nevertheless, the winner of this year’s country award, Banco Nacional de Guinea Ecuatorial (BNEG), was better prepared than many of its peers for this reversal in fortunes. 

In 2012, the bank’s leadership radically restructured the lender’s business priorities by focusing on the strongest retail segments, including public servants, as well as corporations with high revenues and cash flow, such as retailers. In terms of sectors, the bank looked to high-growth targets such as agriculture and fishing. 

Cumulatively, this strategy has paid dividends and softened the blow for BNEG during a challenging time for the market as a whole.

“The recent crash in the market value of oil, the country’s main source of revenue, could have had a severely damaging effect on the bank´s profit results for the years 2016 and 2017. However, our relentless pursuit to innovate our catalogue of financial products, as well as our highly efficient risk management procedures, has allowed us to maintain a stable track of profits, similar to previous years when the country’s economy was in better shape,” says Manuel Osa Nsue Nsua, chief executive of BNEG. 

In recent times, BNEG has massively expanded its network of branches, from 13 to 22, to become the bank with the largest footprint in the country. In addition, it has also developed an online banking service for its clients as part of its 2015-17 strategic plan. 

Gabon, United Bank for Africa Gabon 

Gabon, Africa’s fifth largest oil producer, has been struggling to diversify its economy in a challenging economic climate. Gross domestic product growth slowed to 2.1% in 2016, down from 3.9% in 2015 as the country’s current account deficit has increased and the fiscal deficit has widened. Though a $642m International Monetary Fund facility is expected to help the government over the medium to longer term, the country’s immediate prospects are less promising. 

Nevertheless, it hasn’t been all bad news for the country’s banks. Our winner in the 2017 country award, United Bank for Africa Gabon (UBA Gabon), has performed particularly well despite these challenging circumstances. 

The bank’s net profits, in local currency terms, increased by 87% in 2016. Though this, in part, reflects a more difficult performance in 2015 when net profits fell by 54%. Total assets grew by 19% over the same period, marking a significant improvement on the 1% growth recorded in 2015. More impressively, UBA Gabon’s return on equity increased over the review period by reaching 12%, up from the 6% it posted in the previous year. In addition, its cost-to-income ratio and non-performing loan ratio both fell by 1% year on year, hitting 73% and 1%, respectively. 

UBA Gabon’s financial inclusion initiatives also impressed the judging panel. In particular, the launch of the bank’s prepaid cards for customers without bank accounts, representing one of the first offerings of this type in the country, stood out. UBA Gabon also provides an agency banking platform to microfinance institutions looking to bank underserved segments of the population as well as micro, small and medium-sized enterprises across the country. 

Gambia, Ecobank Gambia 

Ecobank Gambia has reason to be pleased with its recent performance. In 2016, the bank registered net profit growth of 3%, after achieving 64% growth in 2015, while total assets and Tier 1 capital increased by 8% and 31%, respectively. Return on equity was strong at 22% and the bank’s cost-to-income ratio was more or less steady at 58%. 

Underscoring this performance is the bank’s strategy; to build a simple and digital brand the helps customers to access their accounts 24/7 and ensure that they receive faster and more efficient service through the use of technology. 

“Our mobile banking app provides retail customers with ‘whenever and wherever banking’ using their mobile phones and they can check account balances, transfer money, pay bills and generate statements from the comfort of their current location,” says Josephine Anan-Ankomah, managing director of Ecobank Gambia. 

Innovations such as Ecobank’s Xpress Account also caught the attention of the judges. This account uses a customer’s mobile phone number and the Ecobank mobile app to open a new bank account. This is the fastest means possible for a customer to open a new account. 

“Our plan is to continue to innovate our products and services and, most especially, fully implement agency banking and the increased digitalisation of our products to significantly improve financial inclusion,” says Ms Anan-Ankomah. 

Meanwhile, Ecobank Gambia has also been pursuing a strategy of revenue diversification to improve risk management, augment shareholder value and increase the bank’s operational efficiency. This is being executed in tandem with efforts to recruit and keep the country’s best talent and to become the employer of choice in the banking industry. 

Ghana, Zenith Bank Ghana 

Though Ghana’s economy has improved over the course of 2017, it registered gross domestic product growth of just 3.5% in 2016, its lowest level in two decades. But if the market as a whole was depressed over this period there is little evidence that it troubled the 2017 country winner, Zenith Bank Ghana, at all. 

The lender’s net profits increased by 76% in 2016 while its total assets and Tier 1 capital grew by 34% and 32%, respectively. Beyond this, Zenith Bank Ghana’s return on equity increased to 40% from 29% year on year, while its cost-to-income ratio fell to 40% from 44%.

“The bank prides itself with the creation of a reputation for excellent customer service and a respectable corporate governance culture. Consequently, our balance sheet has grown by 45% year on year and we have maintained a customer retention rate of 99.97%. These have resulted in the bank winning notable awards across the globe,” says Henry Oroh, managing director and chief executive of Zenith Bank Ghana. 

Over the 2016 review period, the bank pursued a number of strategic initiatives. These included a greater emphasis on retail banking to minimise the reliance on volatile corporate deposits, the development of innovative products and services to cater to the unbanked population, and the development of a state-of-the-art 24/7 customer contact centre. 

“The bank will continue to stay engaged with customers and focus on initiatives that will position it as a market leader in the Ghanaian banking industry. Opportunities are also expected to emerge from increased infrastructural spend, developments in the oil and gas sector, and expansions in trade services for private sector growth,” says Mr Oroh. 

Guinea, Ecobank Guinea 

Guinea’s economy is slowly recovering from the shocks associated with the outbreak of Ebola across the region and the commodity price slowdown of recent years. Economic growth reached 6.6% in 2016, while the International Monetary Fund expects 6.7% growth in 2017 thanks to an improving agricultural output and stronger activity in the mining and construction sectors. This offered a fertile growth environment for the country’s banks. The winner of the country award, Ecobank Guinea, saw its net profits increase by 30% in 2016, while total assets and Tier 1 capital grew by 22% and 9%, respectively. 

Nevertheless, challenges for Guinea’s banks remain. “In the market, we are facing disruption from big telecommunications firms deploying mobile payments, such as cash in-cash out and bill payments across the country. In fact, this is not really a surprise since the regulatory [environment is changing] and telcos and various fintech groups are attacking every aspect of the financial services sector [in the country],” says Moukaramou Chanou, managing director of Ecobank Guinea.

Ecobank Guinea has worked hard to improve its in-country distribution in recent times. This is done through eight branches in the capital, Conakry, and 12 across the country. This is accompanied by 39 ATMs country-wide, accepting Visa, MasterCard and China UnionPay. In addition, the bank boasts 56 electronic payment terminals in the country. 

“We want to close 2017 with 50,000 new customers using mobile and by 2018 we want to double this figure. The target is to have more than 400,000 customers before 2020. We will continue our mission to create a truly world-class pan-African bank while contributing to Guinea’s economic development. That’s why our new campaign focuses on our mission to help people realise their dreams,” says Mr Chanou. 

Kenya, KCB Group 

KCB Group, the winner of the 2017 Kenya country award, stood out in a competitive country category based on its strong financials, its commitment to customer service and technological innovation. 

The bank’s net profits surged by 19% in 2016, while assets and Tier 1 capital grew by 7% and 27%, respectively. KCB Group’s return on equity, meanwhile, hit 24% over the review period, up from 21% in 2015. This striking growth was achieved despite a number of pressing challenges in the market. 

“The general operating environment has been fraught with difficulties, ranging from a prolonged electioneering period in Kenya to a change in market conditions occasioned by a cap in interest rates that was introduced in [the country],” says Joshua Oigara, chief executive of KCB Group. 

KCB Group impressed the judging panel with its unique strength in the mobile banking space. Over the review period, the group as a whole boarded an additional 10 million customers onto its mobile bank offering. This allows customers to open an account through their mobile phone. KCB Group is also able to score each client, enabling customers to secure credit via the same means. Mobile banking now accounts for 57% of the group’s total transactions. For customers who do not have smartphones, the bank has developed USSD banking, allowing them to benefit from the nearly 15,000 agency outlets the group boasts across the wider east Africa region.  

“The bank continues to perform well despite these challenges as reflected in our exemplary 2017 half-year performance, which recorded a pre-tax profit of Ks14.75bn [$142.7m]. This was boosted by a strong performance of our core retail and corporate business, non-interest income and lower interest expense,” says Mr Oigara. 

Mauritius, Mauritius Commercial Bank

As an open and globally integrated country, Mauritius’s economy has been buffeted by regional and international headwinds in recent years. But the sophistication and strength of its banking sector has meant that many of the country’s lenders have nevertheless been able to post stellar growth numbers. 

Mauritius Commercial Bank (MCB), this year’s country winner, is no exception. By year-end 2016, net profits had increased by 14.9%, while total assets and Tier 1 capital grew by 12% and 10%, respectively. These strong numbers were achieved despite an array of challenges at home and abroad. 

“The bank pursued its business growth [strategy] in spite of challenging operating conditions that prevailed on both the domestic and regional fronts. In Mauritius, sluggish investment levels and growing recourse to non-bank financing by corporates continued to impact the demand for credit,” says Alain Law Min, chief executive of MCB. 

With a strategic outlook that focuses on an expansion of the bank’s offerings and frontiers, and the completion of its transformation into a digital lender with a human touch, MCB is not short of ambition. Indeed, its cautious growth across the African continent is granting the bank a strong footprint in fast-growing markets in southern and eastern Africa. 

In tandem, MCB’s project finance business is branching out to new and swiftly developing markets including Kenya, Tanzania, Rwanda, Côte d’Ivoire and Ghana, among others. In doing so it is also widening its participation to new industries, including shipping, telecommunications, aviation and solar energy. 

“MCB has sharpened its focus on growth pillars and pursued its regional market diversification agenda. Towards those ends, it has judiciously leveraged its human and physical resources, while furthering technological innovation,” says Mr Law Min. 

Morocco, BMCE Bank of Africa 

In a competitive country category, BMCE Bank of Africa emerged as the clear winner in Morocco for 2017. The judging panel was impressed with the bank’s support for social and economic development across its operating footprint, its commitment to digital innovation in terms of product and service offerings, as well as its strong regional growth across the African continent. These factors, coupled with its solid financial performance, ensured that it scooped the country award. 

The bank’s net profits grew by 4% in 2016 while its total assets and Tier 1 capital exhibited a similar upward trajectory, by expanding 9% and 5%, respectively.

In July 2016, the bank launched its first digital branch to improve the services available for customers living outside of Morocco. This digital branch permits customers to open a bank account through their computer, tablet or smartphone 24 hours a day, seven days a week. In addition, customers can subscribe to the bank’s products and services and seek assistance in up to seven different languages with a bank adviser through the online chat system or by telephone. 

BMCE Bank of Africa’s African Entrepreneurship Award was a standout component of the bank’s entry. This award helps to offer seed financing to launch and scale small businesses across Africa. The annual award provides seed financing to 21 small businesses across the continent and is applied for by businesses from all 54 African countries. 

“Beyond its solid financial performance in 2016, our group continued to invest in sustainable development through a pioneering approach, best illustrated through the BMCE Bank Foundation’s initiative in promoting education in rural areas, the support and development of entrepreneurship across Africa, in addition to setting up the first building blocks in positive impact finance,” says Othman Benjelloun, chairman and chief executive of BMCE Bank of Africa. 

Mozambique, Millennium bim 

Our winner for the 2017 Mozambique country award, Millennium bim, has gone from strength to strength in recent times. Stellar financial growth has been accompanied by investments in the bank’s financial inclusion and outreach initiatives as well as support for small and medium-sized enterprises. In addition, Millennium bim’s success on the digital banking front caught the judges’ attention. Nevertheless, a difficult economic environment has not made this progress easy.

“Cost of funding has been the major challenge for the bank this past year, due to the economic slowdown and the devaluation of the national currency, the metical. Gross domestic product growth has been the lowest in the past 15 years, at 3.8% in 2016. This economic scenario has had a direct impact on the banking system,” says José Reino da Costa, vice-chairman and CEO of Millennium bim.

In 2016, Millennium bim established a new agency banking channel in which it partners with local businesses, including shops and grocery stores, in remote and underserved areas of Mozambique to offer banking products and services. In addition, the lender has partnered with the country’s state-owned postal services provider to offer banking services at post offices nationwide. 

“The main successes were undoubtedly related to the expansion of our commercial network, not only by opening new branches but through our partnership project with Postal Service of Mozambique too, which helped implement banking services and postal services in rural areas as well as through our JáJá Banking Agents project, where we offer a range of financial services to rural and suburban areas. Millennium bim is the first bank with national coverage in Mozambique,” says Mr Reino da Costa. 

The bank’s net profits increased by 33% in 2016, while total assets and Tier 1 capital grew by 14% and 25%, respectively. 

Namibia, FNB Namibia 

On financial performance alone, FNB Namibia is a worthy country award winner. The bank’s net profits surged by 22% in 2016, matched closely by the increase to its Tier 1 capital at 20% and total asset growth, which came in at 15%. In addition, the bank’s return on equity was relatively steady at 31%, while its cost-to-income ratio was 43%. All of this was achieved despite a range of economic headwinds buffeting the domestic economy and that of the wider region.

“The macroeconomic environment remained tough in the past 12 months, globally, in the rest of the sub-Saharan region and locally. A number of countries, including Namibia, had to deal with ongoing commodity price challenges, weakening government finances and drought conditions,” says Sarel Van Zyl, chief executive of FNB Namibia. 

But beyond the numbers, the judges were impressed with the bank’s ambitious growth plans as well as its efforts to innovate in order to improve the customer experience. In recent times, FNB Namibia has acquired a 100% stake in local financial services groups Pointbreak and EBank, giving the lender additional reach in very different market segments. Pointbreak provides investment wealth management services to institutional, corporate and private clients, while EBank offers innovative inclusive banking services to underserved areas of the country. 

The acquisition of EBank, in particular, will augment the bank’s focus on digital banking and financial inclusion through the use of mobile phones. Existing EBank customers will now be offered the use of FNB Namibia’s innovative e-wallet product. 

The bank continues to support the country’s wider development. “OurHoldings Foundation Trust has made significant progress in 2017 in advancing our priority areas of skills development, education and financial literacy, community and health development, and has invested more than N$11m [$792,000] [this past year],” says Mr Van Zyl. 

Nigeria, Guaranty Trust Bank 

In one of the most competitive country categories in Africa, Guaranty Trust Bank has emerged as Nigeria’s Bank of the Year. The bank’s leadership team has reason to be pleased after presiding over an outstanding growth story amid a challenging domestic and regional operating environment. Over the 2016 review period, net profits surged by 37% while total assets and Tier 1 capital both grew by 23%. But in a sign of just how well Guaranty Trust Bank has performed, its return on equity increased to 28% from 25%, while its cost-to-income ratio fell to 40% from 44%. 

“The year 2016 was particularly challenging given the weakness of the naira, depressed oil earnings and inadequate supply of foreign exchange, all of which culminated in the eventual slide of the Nigerian economy into recession. However, we played to our strength by leveraging technology to deliver superior payment solutions, grow our customer base and enhance our service delivery channels to make banking with us simpler, faster and better,” says Segun Agbaje, chief executive of Guaranty Trust Bank Nigeria.

The bank’s outstanding success in the e-payments space is an example of the role that market-beating innovations are playing in its longer term growth story. About 10% of Guaranty Trust Bank’s 2016 profit before tax came from e-payment services, of which ‘Bank 737’, a USSD delivery channel, has played no small part. This service allows any Nigerian to open an account without a minimum balance requirement and to execute transfers and pay bills remotely. Since its launch, the service has gained 3 million customers and facilitated N1000bn ($2.77bn)-worth of transactions. 

“We are transforming our organisation into a platform for enriching lives by positioning ourselves at the centre of an extended ecosystem that offers our stakeholders benefits beyond banking,” says Mr Agbaje. 

Republic of the Congo, United Bank for Africa Congo 

The impact of falling oil prices continues to hit the Republic of the Congo’s economy hard. Annual gross domestic product growth contracted by 2.8% in 2016 as both the oil and non-oil sectors shrank over the period. The country’s immediate outlook is not much brighter; the World Bank expects economic growth to average about 0.9% between 2017 and 2019. In this environment it is all the more impressive that our country winner, United Bank for Africa Congo (UBA Congo), has performed so well.

In local currency terms, the bank’s Tier 1 capital increased by 22% in 2016, while its assets and net profits jumped by 3% and 44%, respectively. Meanwhile, the bank’s return on equity hit 41%, marking a dramatic rise from the 22% recorded in 2014. UBA Congo’s cost-to-income ratio has achieved a similar feat, falling from 70% in 2014 to 54% in 2016. 

Much of this success is down to the bank’s multi-pronged growth strategy, which includes offering a holistic set of products and services along the corporate value chain, next-generation banking for the middle-class retail market, customised payments to facilitate trade and partnering with telecoms companies to offer mobile money. Moreover, UBA Congo is the only lender in the country to have partnered with Visa to develop a pre-paid card for both customers and non-customers. The card can be used at ATMs, points of sale and online to carry out transactions. 

UBA Congo’s commitment to financial inclusion also caught the attention of the judges, as the bank has identified the most excluded groups in society, including women, students, artistic professions and small traders, and developed capacity-raising initiatives around their specific needs.

Rwanda, Bank of Kigali 

Over the past few years, Rwanda’s Bank of Kigali has worked hard to strengthen its leading position in the country’s banking market. By December 2016 the bank had a 33.9% market share of loans and advances and 35.3% of total system deposits, firmly placing it as the dominant player in the country. 

For 2016 as a whole, Bank of Kigali’s performance metrics were strong; net profits increased by 1.3%, while total assets and Tier 1 capital grew by 13.7% and 1.9%. The lender’s return on equity, cost-to-income ratio and non-performing loans all remained relatively stable year on year, sitting at 20%, 47% and 4%, respectively. 

Despite its dominant position in the market, this growth story has not been free of challenges. “A challenge worth noting has been the stiffer price competition in the industry as banks jostled for big money corporate entities, for deposits, and for other business opportunities, although we believe this benefits the customer more and encourages innovation on our side,” says Dr Diane Karusisi, chief executive of Bank of Kigali. 

In terms of its strategy, Bank of Kigali has decided to slow its regional expansion over the short term and instead dedicate more energy to the untapped potential in the Rwandan market. This includes growing the retail component of its domestic business through the introduction of innovative products and services, particularly in the micro-credit space, and by making full use of digital banking capabilities. 

“For us, 2018 is going to be customer-centric, and to achieve that we are going to optimise our efficiency in serving customers through digitising our operations,” says Ms Karusisi. 

Senegal, UBA Senegal 

Senegal has enjoyed something of an economic renaissance over the past few years. While many of its regional peers have struggled as a result of cooling commodity prices, the Senegalese economy has powered ahead to become one of the continent’s best performing markets. 

Much of this success is down to the government’s ‘Plan Senegal Emergent’ (PSE), enacted in 2014, which is designed to tackle low economic growth and sluggish poverty reduction. The result has seen economic growth accelerate to about 6.5% over the past two years with the agricultural and industrial sectors playing a key role in this performance.

For the banks, this uptick in economic activity has been welcome news. The winner of our 2017 country award, UBA Senegal, is a case in point. Net profits at the bank grew by 12%, while total assets and Tier 1 capital increased by 42% and 22%, respectively. This strong year-on-year performance was accompanied by a return on equity of 27% and a cost-to-income ratio of 50%. Non-performing loans, meanwhile, were particularly healthy and remained below 1%. 

The bank is increasingly looking to digital products and services to drive customer engagement and promote financial inclusion. The roll out of an e-commerce platform called Instant Bills, for example, permits customers to pay for goods and services and conduct other payments 24/7 online. In addition, UBA Senegal’s U-Direct internet banking service is tailored to both corporate and retail users and affords them full account functionality on Android or iOS devices. 

Meanwhile, UBA Senegal is positioning itself as the go-to bank for small and medium-sized enterprises in the country, particularly in the area of cross-border finance. 

Sierra Leone, Guaranty Trust Bank Sierra Leone

Things are looking up for Sierra Leone. After rebounding from the twin challenges of an Ebola outbreak and a collapse in iron ore prices, the country registered gross domestic product growth of about 6.3% in 2016. Though the International Monetary Fund expects this figure to moderate somewhat in 2017, to 5.6%, it nevertheless anticipates a brighter medium-term outlook. For the country’s banking sector, this bodes well.

Guaranty Trust Bank Sierra Leone, the winner of the 2017 country award, has shown that there are good profits to be made in the market. Net profits at the bank increased by 15% in 2016, as did total assets, which grew by 14%, and Tier 1 capital, which rose 20%. Meanwhile, the bank’s return on equity was 49% and its cost-to-income ratio was 48%.

The bank’s growth is attributable to its impressive innovations in the market. This includes offerings such as GT-Simpay which enables to interact and transact with their bank account using their mobile phones. Guaranty Trust Bank Sierra Leone has developed two platforms to deliver GT-Simpay. The first involves an overlay, essentially an ultra-thin SIM card, that is inserted alongside an existing SIM card. The second is through the bank’s mobile app, which is an Android-enabled smartphone offering.

The judges were also impressed with Guaranty Trust Bank Sierra Leone’s commitment to financial inclusion. This includes a financial literacy campaign and workshops on financial inclusion to assist those underserved by the financial services sector. In addition, the bank partners with various public institutions, including the central bank and government ministries, to promote financial inclusion initiatives in different regions and provinces of the country.

South Africa, Standard Bank 

Standard Bank enjoyed a strong and steady year in 2016 despite facing a number of headwinds, both at home and across the wider African region. Net profits increased by 4% year on year while the lender’s return on equity was 15.3%, which remained inside its target band of between 15% and 18%. Encouragingly, both its cost-to-income ratio and non-performing loan remained steady at 56% and 3.1%, respectively. 

“In common with the industry as a whole, our biggest challenge remains the defence against cybercrime. As a South Africa-based bank with substantial businesses in the rest of the continent, we also had to deal with considerable currency volatility and increasingly difficult macroeconomic conditions in South Africa,” says Sim Tshabalala, chief executive of Standard Bank. 

Over the past 18 months, Standard Bank has continued to upgrade its core banking system, involving the simultaneous overhaul of both front- and back-office infrastructure across its regional footprint. At the time of writing, the completed upgrade was scheduled for completion by the end of 2017. “We made excellent progress in upgrading our systems and processes to improve customer experience and we have nearly completed a comprehensive IT upgrade,” says Mr Tshabalala. 

Meanwhile, Standard Bank continued to invest and upgrade in its capabilities across the continent as part of a new continuous delivery model. This has contributed to the launch of a universal mobile banking app in Botswana, Ghana, Namibia, Swaziland, Uganda, Zambia and Zimbabwe. 

“We remain firmly bullish about Africa. We expect [economic] growth to accelerate again to about 4% a year over the next two years and many countries – particularly those in east Africa – will continue to grow very fast indeed,” says Mr Tshabalala.

Sudan, Omdurman National Bank

Sudan’s economic growth has been stable if not spectacular in recent years. The International Monetary Fund expects gross domestic product growth to hit 3.2% in 2017, a slight decrease from the 3.6% the country posted in 2016. But six years after the separation of South Sudan, the country continues to face an array of challenges, including difficulties in accessing external financing. Yet, the winner of the 2017 country award, Omdurman National Bank (ONB), has posted impressive growth figures despite these difficulties. 

“Over the past few years, ONB has successfully overcome a number of challenges, the most important of which was the negative economic results of the separation of South Sudan and loss of oil resources,” says Dr Abdel-Hamid Mohamed Jamil. 

Net profits increased by 21% over the 2016 review period, while total assets and Tier 1 capital grew by 11% and 16%, respectively. ONB’s return on equity improved year on year to hit 29.7%, up from 27%, while its cost-to-income ratio continued to fall to 22.7% from 24.4%. 

This stellar performance was, in part, helped by the installation of a new core banking system. The launch of this system has reduced waiting time for customers looking to secure new financing while making it cheaper and more effective for the bank to engage with its clients. 

“ONB looks forward to continuing the development of banking technology, while striving to improve the quality of its services, its clients’ loyalty, and its working environment. The bank is working to maintain its pioneering position in our sector and benefit from the available opportunities, such as the improvement in the political and economic environment as well as opportunities linked with geographic expansion,” says Mr Jamil. 

Tanzania, NMB Bank Plc 

Though Tanzania’s economy was one of the fastest growing in Africa in 2016, expanding by about 7% according to the World Bank, by the end of the year and into early 2017 this growth had started to slow. For the banking sector, the impact of this incremental but downward shift in conditions has led to a higher degree of non-performing loans (NPLs). 

“To a degree, economic growth has slowed and the private sector is struggling, which has made it difficult for companies to meet their loan obligations, thus increasing NPLs. NMB Bank plc has been fortunate in terms of its NPL rate, because it has a cross-section of public and private sector customers,” says Ineke Bussemaker, chief executive of NMB Bank. 

Indeed, NMB Bank’s recent performance has been eye catching. The bank’s net profits grew by 2% over the 2016 review period, while total assets and Tier 1 capital increased by 8% and 12%, respectively. The lender’s return on equity and cost-to-income ratio remained healthy at 20% and 59%, respectively. These strong financials have been accompanied by the introduction of innovative products and services and an increase in the bank’s footprint and distribution channels.

Today, NMB Bank has more than 190 branches and is present in 95% of the government’s administrative districts, while 60% of all branch locations are in rural areas. In addition, the bank as more than 600 ATMs in the market, and its mobile offering, known as NMB Mobile, goes from strength to strength with more than 1 million registered users.

“Mobile and internet services have significantly increased financial inclusion, which, naturally, was not possible 10 to 15 years ago. With mobile banking and mobile services, however, there is a low-cost, scalable way to reach more people than ever before,” says Ms Bussemaker.

Togo, Ecobank 

Unlike many of its west African peers, Togo’s economy has achieved stable and robust growth in recent times. Over the past five years, gross domestic product growth has averaged about 5.5%, according to the World Bank. Driving much of this growth has been a well-structured public investment programme, as well as the strong performance of the agricultural sector, the extractive industries and trade. Cumulatively, this has been a source of good news for the country’s banking sector. Ecobank, the winner of the 2017 country award, and a lender that dominates the country’s financial services sector, is no exception. 

After a deeply challenging performance in 2015, which largely reflects the travails of a lender that operates across the wider region, Ecobank posted strong numbers in the 2016 review period. Net profits rose by no less than 292%, while total assets grew by 17%. The bank’s return on equity hit 54%, while its cost-to-income ratio remained steady at 67%. 

In Togo, the bank has leveraged its unique resources and expertise to achieve strong growth. This includes the bank’s peerless ATM network, which currently numbers 77 nationwide, as well as the launch of its mobile app which has more than 40,000 clients in the country. Indeed, Ecobank’s smartphone app allows customers to create an account online. 

Looking ahead, the bank will soon adopt cardless payment technology that will enable customers to cash out at ATMs or sub-agent outlets. In addition, Ecobank will start an agency banking model in the country that will allow customers to cash in and cash out quickly and securely at a location that is convenient for them. 

Tunisia, Attijari Bank

Though Tunisia’s economic growth has slowly improved in the years following the country’s revolution, it remains sub-optimal. The International Monetary Fund expects gross domestic product growth of about 3.2% in 2017, down from the 3.5% registered in 2016. For the banks, this environment has had a tangible impact on their growth prospects, even if the winner of this year’s country award, Attijari Bank, exhibited outstanding numbers by most key performance metrics.

“The Tunisian economic transition is still giving cause for concern, a situation that has had repercussions on almost all sectors. In spite of the difficult financial environment, 2017 was a key year for us, during which our new strategic plan was launched,” says Hicham Seffa, chief executive of Attijari Bank. 

The lender’s net profits grew by 17.5% in 2016, while its total assets and Tier 1 capital increased by 13.6% and 10.8%, respectively. More impressively still, Attijari Bank’s return on equity improved over the period by hitting 28%, up from the 26% it registered in 2015. Underscoring this amelioration was a reduction in the bank’s cost-to-income ratio, which dropped to 50% from 54%. 

In 2016 the bank launched its new strategy titled ‘Excellence 2020’. As a feature of this strategy, the bank has worked to optimise the credit process by reducing the time it takes for retail clients to receive funds. This has lowered the waiting time from eight days to one day for personal loans and from 27 days to five days for mortgages.

“Attijari Bank will continue to fulfil its role as a driving force to the economic recovery by supporting different actors and financing structuring investments, says Mr Seffa. 

Uganda, Ecobank Uganda

Uganda’s fortunes have taken a turn for the worse in recent years. While economic growth has ticked along at a relatively respectable pace, the economy has nonetheless performed below its potential. In the five years to 2016, average growth was about 4.5% according to the World Bank, compared with 7% in the early 2000s. Poor weather conditions, political volatility in neighbouring countries and private sector credit constraints have all conspired to dent Uganda’s immediate economic fortunes. 

But in the banking sector, good news stories have emerged and the 2017 country award winner, Ecobank Uganda, is the prime example. The bank’s net profits surged by 206% over the 2016 review period while its Tier 1 capital grew by 6%. In addition, the lender was able to halve its level of non-performing loans (NPLs), which came in at 5.5% at the end of 2016, down from 10.2%.

“In 2016, we were faced with macroeconomic challenges, with the economy growing at about 3.4% and the banking industry experiencing the highest asset quality deterioration with the industry NPL standing at more than 10%. Coupled with that, the real estate market also plateaued, thereby slowing down private sector lending,” says Clement Dodoo, managing director of Ecobank Uganda. 

In the financial inclusion arena, the bank received regulatory approval to launch its Xpress Account, which uses standard mobile phones to permit customers to open accounts with the bank by using their phone number as the account number. 

“Partnering with the telecoms and fintech companies will be an opportunity to extend our services to more persons who are currently unbanked,” says Mr Dodoo.

Zambia, Stanbic Bank Zambia 

Recent years have not been easy for Zambia. The country has endured a decrease in copper output accompanied by a lower global price environment, electricity rationing and the depreciation of the Zambian kwacha, among other challenges. In 2015, the country’s economy grew at its slowest rate since 1988 by registering just 2.9% gross domestic product growth for the year. But times are changing. According to the World Bank, the Zambian economy grew by 3.4% in 2016, while it is expected to increase further to 4.1% for 2017. 

In this fast-changing environment, only the most innovative and customer-centric banks can prosper. And this is why Stanbic Bank Zambia has scooped the country award.

In September 2016, the bank officially upgraded its core banking system to Finacle, as part of its parent group’s region-wide upgrade, drastically improving its ability to effectively serve its client base. With a total investment cost of $25m, the new system has already delivered significant and positive change to the bank’s in-country operations. This includes an improved internet banking platform, automated account processes, a new accounts opening process and a world-class mobile banking app.

Meanwhile, Stanbic Bank Zambia has become the first lender in the country to provide a dedicated banking package for women. Known as Anakazi Banking, the offering was designed and launched in partnership with the Global Banking Alliance for Women, meaning that it was devised by women for women. Since its launch, more than 1000 women have signed up for Anakazi Banking. A further 100 women have signed up for the Women in Business programmes run by the bank.

Zimbabwe, Standard Chartered Bank Zimbabwe

Zimbabwe is a difficult place to do banking. Economic growth in 2016 was anaemic, at just 0.7% as the country battled back from the effects of an El Nino-related drought. Even though the financial sector has struggled in these conditions, Standard Chartered Bank Zimbabwe has emerged as the winner of this year’s country award based on its overall resilience and its ability to continuously innovate in order to provide the best possible customer service.

“Standard Chartered Bank Zimbabwe continues to cement its more than 125-year history by supporting its customers and staff. We continue to play a key role in supporting critical sectors of the economy, notably the tobacco sector, which remains the leading generator of foreign currency. As a key player in the banking sector, we have helped industry and individual customers better manage the foreign currency and cash shortages,” says Ralph Watungwa, CEO of Standard Chartered Bank Zimbabwe. 

The bank has played a crucial role in supporting the country’s corporate community in 2016. Throughout the year, it delivered $458m-worth of support to key sectors including agriculture, commerce, manufacturing and commodities. In addition, the bank started catering to new business segments, including medium-market enterprises and high value small businesses, to provide expert assistance to an important component of the national economy. 

And looking ahead, despite the challenges, Standard Chartered Bank Zimbabwe sees substantial opportunity for growth. “The bank seeks to cement its digital platforms and to lead the market in terms of compliance. We also see opportunities in agriculture, where we can work with various value chains to create real value for our customers. Support for the mining sector will be key as this is a key source of the much-needed foreign currency,” says Mr Watungwa. 

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