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Ecobank Ghana Ltd

Annual Report 2016
 Description: Cover Stuart Koe

ECOBANK GH ACCRA MAIN ECOBANK GH A AND C A&C ECOBANK GH SUNYANI Tanoso/Dekyemso Sunyani-Kumsai ECOBANK SSNIT HOUSE BRANCH
19, Seventh Avenue, Ridge West Shopping Mall, No. 783, Jungle Rd, Plot No.5 Block B House NO B 5/2 Highway Ssnit House, Harper Road
PMB GPO Accra East Legon (233) 028 9109407 / Sunyani Central (233) 03220-52043/52045/52056 Adum, Kumasi
(233) 0302-680437/ 681167/8 0302 51 88 91 / 90 (233) 03520-25498,25495 (233) 03220-52094 (233)3220-29254
(233) 0302 68 04 28 (233) 0302 518890 (233) 03520-25490 ecobankgh@ecobank.com (233)3220-21416/7
ecobankgh@ecobank.com ecobankgh@ecobank.com ecobankgh@ecobank.com PMB GPO Kumasi ecobankgh@ecobank.com
P.O.Box AN 16746 Accra-North P.O. BOX 17506, East Legon PMB Ecobank Sunyani BUI BRANCH
C/o Sunyani Branch - Brong Ahafo ECOBANK SAKUMONO BRANCH
ECOBANK GH TEMA ECOBANK GH LEGON ECOBANK GH ELUBO Ocean Waves Hotel,
Ecobank Ghana Limited Tema Off Nuguchi Road Near Legon Western Region , Plot No.5 Block B House No. B 5/2
Sunyani Central Near Sakumono Mobil Service
Branch Town Center Plot No. Mosque, (233) 03122-22054/95/83 (233)0303-413617
TC/ MKT / A / 76. (233) 0302 519835/6 (233) 03122-22567 (233) 03520 25498
(233) 03520 25490 (233)0302-413617/8
(233) 0303 201053 - 6 (233) 0302 519837 ecobankgh@ecobank.com ecobankgh@ecobank.com
(233) 0303 20 10 57 ecobankgh@ecobank.com P.O.Box 48 Elubo ecobankgh@ecobank.com
ecobankgh@ecobank.com P.O Box PMB GPO, Accra ECOBANK GH ABREPO KSI PMB GPO Kumasi ECOBANK OKOFO HOUSE BRANCH
P.O Box co 3207 Tema Abrepo Junction,Kumasi ECOBANK GH SAFE BOND BRANCH Ground Floor, Okofo House , Kwame
ECOBANK GH TAKORADI Nkrumah Avenue Adabraka
ECOBANK GH RING ROAD Plot no. 34 Axim Road Harbour (233) 03220-34850 ecobank- Ground floor safebond car
gh@ecobank.com PMB GPO Kumasi park Building (233)0302-244835
Fidelity House, 20 Ring Road Central Commercial Area PMB Takoradi (233)0302-254693
PMB 43, Cantonments, Accra (233) 03120-23870/ 21250 / 21258 ECOBANK GH WEIJA (233) 0302  200946/7
(233)  0302 200979 ecobankgh@ecobank.com
(233) 0302 244007/8/9 (233) 03120 21 9 13 Ground Floor Aplaku Building,Old
(233) 0302 23 77 45 ecobankgh@ecobank.com Weija Barrier, Opp. National ecobankgh@ecobank.com ASHTOWN EAST BRANCH
ecobankgh@ecobank.com PMB Takoradi. Investment Bank, Winneba Road. P.O.Box CO 3207 Tema Dr. Mensah Traffic Light, Kumasi
PMB 43,Cantonments, Accra (233) 0302- 853202/3 ECOBANK GH AFLAO BRANCH (233)03220-80552/6
ECOBANK GH MKT CLE TDI (233)03220-80699
Old GNTC Building market circle, (233) 0302-853204 ecobank- Hse No. ASI-B-489 Aflao Along
ECOBANK GH TUDU Aflao Border Road ecobankgh@ecobank.com
Kimbu Road, opposite Accra Takoradi gh@ecobank.com PMB GPO, Accra
(233) 03120 29325/6 ECOBANK GH KEJETIA (233) 03625- 30890, 30893 ECOBANK HIGH STREET BRANCH
Central MTTU (233) 03625 31028 Akosa Plaza opposite General Post
(233) 0302 685587/685559 (233) 03120 29 1 00 Pampaso Kejetia Kumasi
ecobankgh@ecobank.com (233) 03220-45801 ecobank- ecobankgh@ecobank.com Office Asafoatse Nettey Street
(233) 0302 68 55 85 P.O.Box CO 3207 Tema (233)0302-673097
ecobankgh@ecobank.com P.O.Box 114 Takoradi gh@ecobank.com PMB GPO Kumasi
(233)0302-673108
P.O Box 16746 Accra North, Ghana ECOBANK GH TARKWA ECOBANK GH ASH TOWN ECOBANK GH LABONE BRANCH ecobankgh@ecobank.com
Ground floor SIC Tarkwa St. Anne's Anglican Church Building Block No. B56 (Opposite Coffee
ECOBANK GH SST office complex Ashanti New Town Kumasi. Shop) Labone ECOBANK KWASHIEMAN BRANCH
Ground Floor Silver Star Tower, (233) 03123 22022/4 (233) 03220-28071 ecobank- (233) 0302-933509 , 768132 Kwashieman Road,
Airport City (233) 03123 22 0 25 gh@ecobank.com PMB GPO Kumasi (233) 0302-768133 P.O.BOX 1862 ACCRA
(233) 0302, 767404/ 778277 ecobankgh@ecobank.com ecobankgh@ecobank.com (233)0302-7008751
(233)0302 78 71 67 ECOBANK GH ABREPO MAIN ecobankgh@ecobank.com
P.O Box 100 Tarkwa Ike 'O' Plaza ,Opposite the Neoplan PMB General Post Office Accra
ecobankgh@ecobank.com ECOBANK KISSEIMAN BRANCH
PMB KA 92, Kotoka International ECOBANK GH OSU Bus Assembly Plant ECOBANK GH TAMALE
Osu Oxford street adjacent (233) 03220-83835 / 83836/ 83837 Plot N0. 84 in  Rice City Residential Close to Pure Fire Church,
Airport, Accra. Kisseman Road
SSNIT hospital. (233) 03220-83838 Area, Tamale, lying along North East 
ECOBANK GH ABEKA LAPAZ (233) 0302 912782/4/5/6 ecobankgh@ecobank.com of  Tamale  - Bolgatanga P.O.BOX 1862 ACCRA
Meacham Hse Annex, Mallam-Abe- (233) 0302 76 31 20 PMB GPO Kumasi Thrunk Road (233)0307008755/0244341765
ka Lapaz Highway ecobankgh@ecobank.com (233) 03720-27933/34 ecobankgh@ecobank.com
ECOBANK GH HAATSO
(233) 0302 230061 PMB CT 443,Cantonments,Accra Ebenezer Plaza Atomic Road haatso, (233) 03720-27936 ECOBANK EAST AIRPORT BRANCH
(233) 0302 23 17 36 ECOBANK GH KUMASI North Legon Residential Area ecobankgh@ecobank.com Dede Plaza Near Action Chapel
ecobankgh@ecobank.com Harper road, Prempeh II roundabout 0302-520834 / 520831 BURMA CAMP BRANCH (233)0302-817061/2
PMB,GPO, Accra Adum PMB Kumasi 021-520833 Opposite the Burma Camp (233)0302-817071
ECOBANK GH MACC HILL (233) 03220 37804 ecobankgh@ecobank.com Post Office ecobankgh@ecobank.com
Kaneshie - Mallam Highway, Lower (233) 03220 37 3 33 PMB GPO, Accra (233) 0302-767414 / 767645 ECOBANK KWABENYA BRANCH
Mccarthy Hill, Gbawe South ecobankgh@ecobank.com ECOBANK GH KISSEIMAN ecobankgh@ecobank.com Adjacent Champion Oil near
233) 0302 275375 / 028 910061 / ECOBANK GH KUMASI ADUM Ground Flour of building situated at ECOBANK REINSURANCE HOUSE Kwabenya Roundabout
275375 (233) 0302- 27 5375 Oak Arcade, Opp. Agyekum Building, Christain village opposite Golf BRANCH (233)0302-409241
ecobankgh@ecobank.com Adum – Kumasi Channel, Kisseman Reinsurance House 68 Kwame ecobankgh@ecobank.com
PMB, GPO, Accra (233) 03220-47948,47959,47969 0302-920849 Nkrumah Avenue P.O. Box 1862 ECOBANK OKPONGLO BRANCH
ECOBANK GH DANSOMAN (233) 03220-45872 ecobankgh@ecobank.com Accra Okponglo towards La Bawlashie
Plot No. 1A, High Street, Dansoman ecobankgh@ecobank.com PMB GPO, Accra (233)0302-240049 Traffic Light, Legon
Estate (233) 0302 326580/82 PMB GPO,Kumasi ECOBANK TEMA MOTOR WAY (233)0302-240056/9 P.O.BOX 1862
(233) 0302 326595 ECOBANK GH JUBILEE HSE ROUNDABOUT ecobankgh@ecobank.com (233)0302922401/030-7008757
ecobankgh@ecobank.com Ecobank Jubilee House , Ground Floor of Gyau Towers on ECOBANK TRUST TOWERS BRANCH (233)-277-900125
PMB, GPO, Accra Cocobod Building Plot No.LI//5A/13A,Accra tema Sobukwe Road (Farrar) Avenue ecobankgh@ecobank.com
(233) 03220 45805 Motorway Light Industrial Area (233)0302-238121 ECOBANK ASHIAMAN BRANCH
ECOBANK GH SOUTH IND 0303-305510/11/12/14
Old KBL Depot, near (233) 03220 45 8 02 (233)0302-238387 Plot No. Ash/b58 Ashaiman Market
ecobankgh@ecobank.com 0303-305513 ecobankgh@ecobank.com (233)03027051141
Agbogbloshie Market ecobankgh@ecobank.com
(233) 0302-670770,670745,670752 ECOBANK GH TEMA MALL ECOBANK TESANO BRANCH ecobankgh@ecobank.com
Ground Floor Tema Shopping Mall, P.O.Box CO 3207 Tema (233)0302-237317 ECOBANK EVANDY HOSTEL BRANCH
(233) 0302-670738
ecobankgh@ecobank.com Heavy Industrial Area,Area Tema ECOBANK GH MADINA (233)0302-237316 Legon Campus, Evandy Hostel
PMB, GPO Accra (233) 0305-305175,305182,305183 Ground Floor and entire first floor of ecobankgh@ecobank.com (233)0307-051145
(233) 0305 - 22305174 the Agrimat Building on Plot No.389, Tesano P.O.Box 1862 ecobankgh@ecobank.com
ECOBANK GH ACCRA MALL North Legon residential Area
Ground Floor,Accra International ecobankgh@ecobank.com ECOBANK HOSPITAL ROAD BRANCH ECOBANK BANTAMA GNTC BRANCH
(233) 0302 521876
Mall,Tetteh Quarshie Interchange,Ac- P.O.Box CO 3207 Tema (233) 0302 521878
Hospital Road, Com 11 Junction Bantama Kumasi
cra ECOBANK GH KENYASE (233)0303-300973 0289-240055/0244329097
Newmont Bypass Road Kenyasi ecobankgh@ecobank.com (233)0303-308460 ecobankgh@ecobank.com
(233) 0302-823053/4/5 PMB GPO, Accra
(233) 0302- 823056 Brong Ahafo Region ecobankgh@ecobank.com Bantama Kumasi
ecobankgh@ecobank.com (233) 024 2209099 / 03220 47034 ECOBANK GH MILE 7 ACHIMOTA ECOBANK KASOA BRANCH ECOBANK PENTAGON LEGON
PMB GPO, Accra (233) 03220-47034 Ground Floor of house No.AT/A39, BAWJIASE RAOD BRANCH
ecobankgh@ecobank.com New Achimota (233)0302-862887 Legon Campus Accra
ECOBANK GH SPINTEX RD (233) 0302 416904/5 233)
Hse, No.56,Baatsona Highway P.O.Box 91,Kenyasi (233)0302-862886 0289-240085
ECOBANK GH NEW ABIREM 0302 413807 ecobank- ecobankgh@ecobank.com ecobankgh@ecobank.com
Extension( Spintex Road),Accra. gh@ecobank.com PMB GPO, Accra
(233) 0302-815860 Newmont Site, Abirem District, BAWJIASE RAOD ECOBANK TWIFO BRANCH
(233) 0302-815861 Akyem, Eastern Region C/O ECOBANK GH KOTOBABI Ecobank Kantamanto Branch Twifo Oil Palm Plantation Estate
ecobankgh@ecobank.com Newmont Gold Ghana Limited Modex Filling Station Premises Tarzan House near Hotel De Horses Twifo Praso
P.O.Box SR112, Tema (233) 7011852 Ext. 52080 kotobabi highway (233)0302-678243 0332 195513
ecobankgh@ecobank.com (233) 0302 250325/7 (233)0302-678246 ecobankgh@ecobank.com
ECOBANK GH NIMA (233) 0302 250330
Ground Floor, House No. E4/17, ECOBANK GH LONG ROOM ecobankgh@ecobank.com ECOBANK BENSO BRANCH
ecobankgh@ecobank.com
Nima – Maamobi Highway, Ghana Ports and Harbours Head PMB GPO, Accra ECOBANK MADINA CENTRAL Benso oil Plam Plantation(BOPP)
(233 ) 0302 238261/241883 Office Long Room, Tema BRANCH Estate Adum-Benso , Estates
(233) 0302 241889 (233) 0303-202125 / 206789 ECOBANK GH BANTAMA Old Road Taxi Rank Near Randy Western Region
ecobankgh@ecobank.com (233) 0303 20 21 25 Ground and First Floors of building Pharmacy, Accra 0322092185/03220 902055
PMB, GPO, Accra ecobankgh@ecobank.com situated on Plot No.20,Bantama (233)0302-513321/2 ecobankgh@ecobank.com
P.O.Box CO 3207 Tema High Street Kumasi (233)0302-513321
ECOBANK GH DARKUMAN (233) 03220 49006 ECOBANK NEW ABEKA BRANCH
Ground Floor, Ideal House, ECOBANK GH TEMA COMM 6 ecobankgh@ecobank.com New Abeka Branch,
ecobankgh@ecobank.com
Darkuman Junction, Kaneshie - Vertical Plaza, Hospital Road, PMB GPO Kumasi ECOBANK COMMUNITY 1 BRANCH H/N B8/27 Flat Top - George Bush
Mallam Highwa Community 6, Near TFS Building Highway, Akweteman
(233) 0302 321950 (233) 0303 216605 ECOBANK GH STADIUM AMAKOM (233)0303-213705 0289559780 
(233) o302 321940 (233) 0303 205822 Ground Gloor of building formerly (233)0303-213707 ecobankgh@ecobank.com
ecobankgh@ecobank.com ecobankgh@ecobank.com known as Edward Nassar Building, ecobankgh@ecobank.com ECOBANK COLLINS STREET
PMB, GPO,Accra P.O. Box Co 3207, Tema Kumasi Sports Stadium ECOBANK SUAME BRANCH Adjacent Arvo Hotel
(223) 03220-83841 Suame - Offinso Road, Kumasi P. O. Box TD114, Takoradi
ECOBANK GH TAFO ECOBANK GH KNUST (233) 03220 83844
Tafo Mampoteng Road Tafo Kumasi Commercial Area, KNUST (233)03220-44414 Tel: (233)312024158, 24190
ecobankgh@ecobank.com 233-3220-30229 Fax: (233)312024173
(233) 03220-40890 (233) 03220 63051/2/3 PMB GPO Kumasi
ecobankgh@ecobank.com (233) 03220 63050 ecobankgh@ecobank.com ecobankgh@ecobank.com
PMB GPO Kumasi ecobankgh@ecobank.com ECOBANK GH TANOSO
PMB, GPO, Kumasi First Floor of property on site with
Petrol Filling Station, No. 6,
 TIME TO
GO DIGITAL

2 Ecobank Ghana Annual Report 2016

Ecobank Ghana Annual Report 2016 3
4 Ecobank Ghana Annual Report 2016
 Annual Report
2016

Contents
Corporate Review
Corporate Information 8
Financial Highlights 16
Business Segment Highlights 18
Chairman’s Address 26
Managing Director’s Statement 30
Corporate Social Responsibility 34
Sustainability Report 38
Directors’ Report 44
Corporate Governance 50
Report of Independent Auditors 54

Financial Statements
Consolidated Statement of Comprehensive Income 58
Consolidated Statement of Financial Position 60
Consolidated Statement of Changes in Equity 62
Consolidated Statement of Cash Flows 66
Notes to the Consolidated Financial Statements 68
Five Year Financial Summary 150
Value Added Statement 151

Shareholder Information
Number of Shareholders 152
Proxy Form 154
Resolution 155

Ecobank Ghana Annual Report 2016 5

6 Ecobank Ghana Annual Report 2016
Notice of Meeting
NOTICE IS HEREBY GIVEN that the Annual General Meeting (AGM) of Ecobank Ghana Limited will
be held at the College of Physicians and Surgeons, 54 Independence Avenue, Accra on Friday the
5th day of May, 2017 at 10.30 am to transact the following business:

AGENDA

1. TO CONSIDER AND ADOPT the Statement of Accounts of the Company for the year ended the 31st
day of December, 2016 together with the Reports of the Directors and Auditors thereon.

2. TO DECLARE a Dividend.

3. TO RATIFY the appointment of Directors.

4. TO AUTHORISE the Directors to fix the remuneration of the Auditors.

5. TO FIX the remuneration of the Directors.

A MEMBER entitled to attend and vote at the meeting is entitled to appoint a proxy to attend and
vote in his/her/its stead. A proxy need not be a member of the Company. The appointment of
a proxy will not prevent a member from subsequently attending and voting at the meeting in
person. A proxy form is on the last page of the Annual Reports which should be completed and
deposited with the Registrars at Ghana Commercial Bank, Registrars Office, Thorpe Road, High
Street, Accra not later than 3.00pm on Thursday 4th May, 2017.

DATED AT ACCRA THIS 27TH DAY OF MARCH, 2017.

BY ORDER OF THE BOARD

AWURAA ABENA ASAFO-BOAKYE (MRS.)

(COMPANY SECRETARY).

Ecobank Ghana Annual Report 2016 7

Corporate Information

1 2 3

4 5 6

7 8 9

Company Secretary

Board of Directors
8 Ecobank Ghana Annual Report 2016
BOARD OF DIRECTORS
1. Terence Ronald Darko - Chairman
2. Daniel Sackey (Appointed, 1/9/16) - Managing Director
3. Thomas Chukwuemeka Awagu
4. Martin Eson-Benjamin
5. Felicity Acquah (Mrs.) (Appointed, 5/5/16)
6. Rosemary Yeboah (Mrs)
7. Samuel Ashitey Adjei
8. Morgan Fianko Asiedu
9. Edward Nartey Botchway (Appointed, 1/12/16)

George Mensah-Asante (Resigned, 1/12/16)

Ernest Thompson (Resigned, 13/2/17)
Mariam Gabala Dao (Mrs) (Resigned, 9/5/16)
Evelyne Tall (Mrs) (Resigned, 15/12/16)

SECRETARY
Awuraa Abena Asafo-Boakye
19 Seventh Avenue
Ridge West
Accra

AUDITORS
KPMG
Chartered Accountants
13 Yiyiwa Drive, Abelenkpe
P O Box GP 242
Accra

REGISTRARS
GCB Bank Limited
Thorpe Road
High Street
Accra

REGISTERED OFFICE
Ecobank Ghana Limited
19 Seventh Avenue
Ridge West
Accra

Ecobank Ghana Annual Report 2016 9

Corporate Profile

MR. TERENCE RONALD DARKO MR. DANIEL NII KWEI-KUMAH

BOARD CHAIRMAN SACKEY
Mr. Terence Ronald Darko is the Managing Director of MANAGING DIRECTOR
Mechanical Lloyd Company Limited, a position he has
held since 1978. He is a seasoned business executive Mr. Daniel Nii Kwei-Kumah Sackey was appointed as
who serves on the Board of Directors of several the Managing Director of Ecobank Ghana Limited and
Institutions. These include the Board of Trustees of Regional Executive for Anglophone West Africa region
the Social Security and National Insurance (SSNIT) and with effect from 1st September 2016.
Edendale Properties Limited.
He is an accomplished banker with extensive banking
He was appointed as the President of the Ghana experience across East, West and Southern Africa. He
Employers Association (GEA) in September, 2010. Mr. has played various key roles within the Ecobank Group
Darko holds Bachelor’s degree in Business Studies from since he joined the Bank in 1995. He previously served
the University of London. as Managing Director for Ecobank Zimbabwe and Cluster
Head for the Southern Africa Development Community
(SADC) zone comprising Zimbabwe, Zambia, Malawi,
Mozambique and Democratic Republic of Congo. Other
positions he has occupied include Managing Director
of Ecobank Rwanda, Deputy Group Risk Manager and
Regional Risk Manager.

Mr. Sackey holds a Master’s Degree in Business

Administration with specialisation in International
Banking and Finance from the University of
Birmingham, U.K and a Bachelor of Science degree in
Administration (Accounting Option) from the University
of Ghana.

MR. THOMAS CHUKWUEMEKA AWAGU

NON-EXECUTIVE DIRECTOR
Mr. Thomas Chukwuemeka Awagu was a pioneer member of
the Board of Ecobank Nigeria Plc where he served for several
years. He also served as chairman of the Building Committee
and Board Credit Committee at different times.

He is currently the President of both the Institute of Directors

Nigeria and the Nigerian- British Chamber of Commerce. Mr.
Awagu is also the Treasurer of the Nigerian Association of
Chambers of Commerce, Industry, Mines and Agriculture.

Mr. Awagu holds Bachelor’s and Master’s degrees in

Architecture from Ahmadu Bello University, Zaria and is
the pioneer managing director of Pyramids Plc, a multi-
disciplinary firm of architects, engineers and cost consultants.

10 Ecobank Ghana Annual Report 2016

MR. MARTIN ESON-BENJAMIN MRS. FELICITY ACQUAH
NON – EXECUTIVE DIRECTOR NON – EXECUTIVE DIRECTOR
Mr. Martin Eson- Benjamin served from November 2006 Mrs. Felicity Acquah, a Project Analyst and
to May 2014 as the CEO of the Millennium Development Development Banker by profession, recently retired
Authority (MiDA), charged with the implementation of as Managing Director of Eximguaranty Company (Gh)
Ghana’s USA-funded US$547m Agricultural Compact Limited. With over 35 years of banking and business
Program. Prior to this, he was the CEO of Empretec experience, she has served in senior positions at the
Ghana Foundation, serving concurrently as a member Agricultural Development Bank, National Investment
of the Presidential Commission on Pensions, from Bank, Merchant Bank and Women’s World Banking.
2004 to 2006. Mrs. Acquah was also a pioneer in establishing the
Empretec Ghana Foundation where she worked for
This was subsequent to a very successful career, seven years.
spanning over thirty years (1972-2004), in Unilever
Ghana’s Lever Division, where he rose to become In 2005, the Kwame Nkrumah African Leadership
the Marketing Director, and in the brewing industry. Award was conferred on her by the West Africa
Mr. Eson-Benjamin served as the Chairman and first magazine. She was also adjudged as the “Marketing
Ghanaian Managing Director of the Kumasi Brewery Woman of the Year” in 2007 by the Chartered Institute
Limited (KBL) in 1995, a joint venture of Heineken and of Marketing Ghana. Mrs. Acquah holds an Executive
Unilever and then as Managing Director of the Ghana MBA (Finance) from GIMPA, a BA degree in Economics
Breweries Limited (GBL), a Heineken International’s and Law from the Kwame Nkrumah University of
subsidiary in 1997, bowing out as Chairman of the GBL Science and Technology and a Postgraduate Diploma in
Board in 2004. Project Appraisal and Management from the University
of Connecticut, USA.
He currently chairs the Enterprise Insurance Company
Limited, Enterprise Properties Limited and the Advisory She has served on numerous Boards in the past and is
Board of the University of Ghana’s College of Health currently a member of the Board of Bayport Financial
Sciences and is a member of the Board of CFAO Ghana Services as well as Camelot Limited.
Limited. He was named by the Chartered Institute
of Marketing Ghana in 1994 as ‘Marketing Man of
the Year’. In 2008, he was honoured by the State as
Officer of the Order of the Volta, for his contribution to
Industry. He holds a BSc degree in Administration from
the University of Ghana.

Ecobank Ghana Annual Report 2016 11

Corporate Profile

MR. SAMUEL ASHITEY ADJEI MRS. ROSEMARY YEBOAH

NON-EXECUTIVE DIRECTOR NON-EXECUTIVE DIRECTOR
Mr. Samuel Ashitey Adjei is currently the Managing Mrs. Rosemary Yeboah is an experienced Banker
Director of Ecobank Kenya with additional with over 23 years banking experience working with
responsibilities as Regional Executive of the Central, International Banks in the United Kingdom, Ghana and
Eastern and Southern African region of the Ecobank Southern Africa. These include Standard Chartered Bank
Group. Prior to this, he served as the Managing and Credit Suisse First Boston.
Director of Ecobank Ghana Ltd and Cluster Head for
the Anglophone West Africa (AWA) region for over ten She has been with the Ecobank Group since 2008 and
years. held various positions within the Group. She has served
as Group Cluster Head; Corporate Banking-WAMZ region,
Mr. Adjei is a seasoned banker with over 26 years Group Head, Multinational & Regional Corporates, with
experience in the Ecobank Group. He holds a BSc in responsibility for managing the Networked Corporate
Statistics and an MBA (Finance) from the University of Clients within the Bank, and Regional Head, Corporate
Ghana, Legon. Banking, EAC.

She holds a BA (Hons) in Economics from the University

of Kent, Canterbury, UK, an MA, Economics, from the
Université De Grenoble, France, and an MBA from
the Laureate University of Liverpool, UK. She has also
had leadership exposure with the Centre for Creative
Leadership and University of Oxford, SAID Business
School, UK.

MR. MORGAN FIANKO ASIEDU

EXECUTIVE DIRECTOR (LEGAL, COMPLIANCE
& HUMAN RESOURCE)
Mr. Morgan Fianko Asiedu has been with the Ecobank Group
since February 1992. He was appointed Executive Director of
Ecobank Ghana (EGH) with oversight responsibility for the Legal,
Human Resources and Compliance Departments in September
2012. Prior to this appointment, he was the Group General
Counsel and Company Secretary of Ecobank Transnational
Incorporated (ETI), the parent company of the Ecobank Group.
In this role Morgan was Chief Legal Counsel to both the Board
and Management of ETI. Before assuming the position of Group
General Counsel in July 2010, he was Company Secretary and
Head of the Legal Department for EGH.

Morgan was part of the Management team that transformed

EGH from a two branch Merchant bank into a Universal Bank
with several branches across the country. Other positions held
in EGH include Head of Administration and Head, Legal & Credit
Administration Department. A member of both the Ghana Bar
and the International Bar Associations Morgan holds Bachelor’s
and Executive MBA degrees both from the University of Ghana.
12 Ecobank Ghana Annual Report 2016
MR. EDWARD NARTEY BOTCHWAY AWURAA ABENA ASAFO-BOAKYE
EXECUTIVE DIRECTOR (FINANCE) COMPANY SECRETARY
Mr. Edward Nartey Botchway joined Ecobank Ghana in Awuraa Abena Asafo-Boakye is the Company Secretary
November 2004. He was appointed Executive Director and Head of the Legal Department of Ecobank Ghana.
(Finance) of Ecobank Ghana on 1st December 2016. She has been with Ecobank Ghana Limited since
1996 and has held various positions including Head,
He is also the Regional Chief Finance Officer for Human Resources with additional responsibility for the
Anglophone West Africa comprising Ghana, Guinea, Anglophone West Africa region. Prior to this, she worked
Liberia, Sierra Leone and Gambia. He also holds the as a Legal Practitioner at Sena Chambers, a leading law
position of Regional Chief Finance Officer for Central, firm in Ghana.
Eastern, and Southern Africa. Outside of Ecobank Ghana,
Edward has held the positions of Executive Director Awuraa Abena holds an LLB degree as well as an
Finance of GCB Bank, Finance Manager Citi Savings and Executive MBA (finance) degree from the University of
Loans and Head of Group Loans Citi Savings and Loans. Ghana, Legon.
Edward has over 19 years in the banking sector and
was voted best Chief Finance Officer in Ghana for 2015
and 2016 by Instinct Magazine.

Edward is a Fellow of the Association of Certified

Chartered Accountants (ACCA) – United Kingdom and
a member of the Institute of Chartered Accountants
(ICA) Ghana. He holds a Master’s in Applied Business
Research from the Swiss Business School – Zurich
Switzerland, a Postgraduate degree in Contemporary
Management from the Nobel Business School Accra
and a BA Economics from the University of Ghana.

Ecobank Ghana Annual Report 2016 13

Management Team

Daniel Nii Kwei- Morgan Asiedu Edward Botchway

Kumah Sackey Executive Director, Executive Director -
Managing Director Legal, Compliance & Finance / Chief Finance
Human Resource Officer

John Nyaaba Daphne Oppong Fiifi Brandful

Head, Treasury Head, Human Resource Head, Operations
& Information
Technology

Awuraa Abena Alfred Sakyi Joana Mensah

Asafo - Boakye Head, Commercial Head, Risk Management
Company Secretary & Banking
Head, Legal

14 Ecobank Ghana Annual Report 2016

Ofei Agyekum Henry Ampong Rita Tsegah
Head, Venture Capital
Head, Internal Control Head, Corporate
Banking

Albert Bartlett- Valerie Bruhl Carl Asem

Mingle Head, Operations Business Manager
Head, Internal Audit

Ecobank Ghana Annual Report 2016 15

 Financial Highlights

16 Ecobank Ghana Annual Report 2016

 The Group The Bank
2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

At 31 December

Total assets 8,056,870 6,691,810 8,025,510 6,587,487

Loans and advances to customers (net) 3,480,544 3,117,873 3,480,471 3,116,749

Customer deposits 5,416,916 4,837,950 5,316,625 4,664,513

Shareholders’ equity 964,076 889,753 952,208 881,028

For the year ended 31 December

Revenue 1,206,657 1,023,129 1,201,168 1,025,765

Profit before tax 462,676 458,560 457,186 461,079

Profit after tax 327,896 321,266 325,594 327,523

Dividend per share (Ghana pesewas) 82 84 82 84

Earnings per share (Ghana pesewas):

- Basic 112 110 111 112

- Diluted 112 110 111 112

Return on average equity (%) 35 38 36 39

Return on average assets (%) 4.4 5.2 4.5 5.3

At 31 December

Number of staff 1,617 1,465 1,611 1,459

Number of branches 77 77 77 77

Ecobank Ghana Annual Report 2016 17

 Business Review

18 Ecobank Ghana Annual Report 2016

CONSUMER BANKING
Consumer Banking is made up of Premier, Advantage and Direct banking through thoughtful, helpful, fast and efficient branch and phone-based
segments; with uniquely created value propositions for each segment. services supplemented with best-in-class digital access.

We offer tailor-made products such as Personal Loans, Mortgages, Classic: We provide convenient banking for the majority of our clients
Remittances, Cards & e-banking and Current Account & Savings Accounts with annual incomes up to $20,000 through a wide range of digital
(CASA). channels namely ATM and POS, Mobile App, Internet Banking, Master
Pass QR and the call center and we offer Classic Accounts, Savings
Premier: This segment delivers the best-in-class banking for global Accounts and Debit & Credit Cards.
African business leaders with annual incomes of $100,000 and above;
offering them premier accounts, wealth management, personal and Youth: This unit seeks to deliver branch-free banking for the tech-savvy
mortgage loans and Platinum credit/debit cards. Products are delivered youth who expects speed and convenience with the mobile app, internet
through in-person relationship management at convenient locations banking, ATM and POS, prepaid cards and debit cards.
supplemented with best in class digital access.
DIGITAL FOOTPRINT
Advantage: This segment provides customised banking solutions to the To sustain leadership in the retail segment, the bank launched its Mobile
upwardly mobile leaders of tomorrow with annual incomes between App and the Xpress Account in 2016. By putting banking service in the
$20,000-100,000 offering Advantage Accounts, Savings Accounts, palm of customers, they now have the convenience to bank anywhere
Personal Loans, Mortgages, Gold Credit / Debit / Virtual Cards delivered and everywhere through the Mobile App.

2016 highlights
Revenue - GH¢ m

Consumer Banking recorded a 25% growth in total revenue

279 350 in 2016.Key revenue drivers were Cards, Current & Savings
Account and remittances.

2015 2016
Deposits - GH¢ m

The unit closed the year with a Deposit volume of GH¢

1.7billion representing a 14% growth over the 2015 figure
of GH¢ 1.5billion.
1,517 1,723

2015 2016
Profit - GH¢ m

Profit for the year of GH¢148 million in 2016 was 49% above the 2015
profit of GH¢ 99million. The key revenue drivers and the efficiency gained
in the reorganization of segments and products to reduce cost-to-serve
99 148 had a direct impact on the profit for the year.

2015 2016
Loans - GH¢ m

The Consumer Banking loan book grew by 33% in 2016

from GH¢318milllion in 2015 to GH¢422 million in 2016.
318 422
Ecobank Ghana Annual Report
2015 2016 2016 19
Business Review

COMMERCIAL BANKING

Commercial Banking (CMB) was established as a focused division for small and medium enterprises and local corporate business
whose needs are primarily local. The management of CMB customers is organised according to their annual turnover - up to $5m
for Small Businesses (SMEs), and up to $50m for locally owned mid corporate businesses (Local Corporates Medium). All Educational
institutions, Not-For-Profit entities and companies limited by guarantee such as faith based organisations are managed under the
Public Sector segment within Commercial Banking.

The unit offers a wide range of products and financial services to customers through Ecobank’s unrivalled physical network and digital
offerings. Commercial Banking products and services include loans, bank accounts, treasury services, invoice discounting, trade
finance and asset finance. OMNI, our cash management product, provides a straight-to-bank digital solution for our business clients.

Profit before tax of GH¢ 62.3m was impacted by an impairment charge of GH¢ 24.5m. Revenue was up 42% compared to prior year.
Strong double digit growth in headline revenues was mostly due to the addition of the Public Sector business overseeing Schools,
Faith Based Organizations and Professional Groups. Net interest income of GH¢ 177m went up 82% from prior year on account of
increased deposits and improved net interest margins particularly in the fourth quarter 2016. Improvements in Non-Funded income
was attributable in part to FX income.

In September 2016, our team met with our SME club members for deliberations on
emerging digital trends. The session was to inform and educate business leaders within
the Club on digital innovations and developments and how member companies could
improve their operational efficiency by adopting some of these strategies.

As part of Ecobank’s commitment towards building capacity amongst small businesses

using the SMEClub Networking events, Commercial Banking also held a conference
between club members and the Staff and Faculty of Stanford Graduate School of
Business. This event was in collaboration with the Stanford SEED tranformation Project.

CMB continues to strengthen our brand proposition by partnering our Corporate Bank
Units to provide business solutions to their downstream businesses.

20 Ecobank Ghana Annual Report 2016

Revenue - GH¢ m

Commercial Banking made revenue of GH¢ 228m

228 which was 42% up compared to prior year. Strong

double digit growth in headline revenue was mostly
due to the addition of the Public Sector business

161 overseeing Schools, Faith Based Organizations and

Professional Groups.

Gross Loan - GH¢ m

302 Loans to Customers was down by 5% reflecting a

more selective asset origination thereby keeping
growth almost flat.
306

Deposits - GH¢ m

1,323 At the end of 2016, Customer Deposits grew 42%

on 2015 – the growth was largely from the addition
of Schools and Churches to the Commercial

932 Banking Business

Recoveries - GH¢ m

Recoveries in 2016 increased more than four-fold owing

8.8 to a renewed focus on recoveries . Dedicated remedial

teams tasked with collection continue to make significant
progress with currently classified /impaired exposures.

Ecobank Ghana Annual Report 2016 21

Business Review

CORPORATE AND INVESTMENT BANKING

Corporate and Investment Banking (CIB) provides tailored • Cash Management: Our Cash Management solutions
financial solutions to Global, Regional & Public corporates as are designed to integrate with our clients’ business
well as Financial Institutions and International Organisations systems and are delivered via our Internet banking
within and outside Ghana. system, OMNI host-to-host delivery channel, and SWIFT.
We also provide short term working capital support and
CIB operates a long-term relationship management approach financing for our clients.
to build a full understanding of clients’ financial requirements.
Sector-focused client service teams comprising relationship • Trade Finance: Our team of Trade experts is specialised
managers and product specialists develop financial solutions in providing technical support in structuring complex
to meet individual client needs. Trade deals, advisory services and originating bridge
financing. Our electronic Trade platforms (e-Trade, Trade
Our Corporate Bank Division provides support to corporate flux and Finance Supply Chain) provide speed-to-market
clients through the provision of core banking products such support to our clients. Leveraging on our wide footprints
as lending, deposits and transaction banking services whilst in the sub-region and Africa, we provided unparalleled
also offering client expertise in Trade Finance and Cash advantage in regional trade business.
Management. The Unit operates a client-centric approach
centered on the five main business segments below: • Fixed Income on Currency and Commodity: Our
treasury provides integrated solutions tailored to meet
• Global Corporate as a unit primarily focuses on Global the foreign currency needs of our corporate clients in
Conglomerates and Multinational Corporations Africa and beyond. The team is specialised in offering
timely conversions and liquidity management solutions.
• The Regional Corporate unit deals with businesses with
headquarters and operations in Middle Africa whose
operations are regionally coordinated CUSTODY BUSINESS
Our Custody business is well resourced to provide an
• Public Corporates as a unit focuses on Parastatal innovative range of security services, including safekeeping
Companies and major state Institutions and settlement, dividend collection and fund administration
services for our corporate and institutional clients. The unit
• The Financial Institutions and International Organization provides a core capability that allows the various Business
unit provides world class banking solutions to segments to deepen banking relationships with their clients,
Multinational & Bilateral Institutions, Embassies, NGOs while also generating sustainable income and liquidity in a
etc capital efficient manner.

• The Local Corporates Unit provides tailored financial

solutions to local corporates with annual turnover
exceeding $20m.

OUR PRODUCTS

Our products are broadly classified into four main categories -

Loans & Liquidity, Cash management, Trade and Fixed Income,
Currencies & Commodities (FICC).

• Loans & Liquidity: We support the growth of our

customers businesses with bespoke medium to long
term lending.

22 Ecobank Ghana Annual Report 2016

 Revenue - GH¢ m
Corporate and Investment Banking revenue grew by 8% from GH¢ 583m in 2015
to GH¢ 629m driven by strong growth in revenue from interest income and trading
income. Net interest income from credit assets, bills and bonds increased by 5% from
GH¢ 421m in 2015 to GH¢ 441m backed by sturdy growth in volume offset by margin

583 629 compressions. Revenue from fees and commissions grew by 20% supported by cash
management and trade finance activities. Net trading income at GH¢ 84m also grew
by 5% compared to prior year.

2015 2016

Deposits - GH¢ m

Customer deposits recorded strong growth of 27% driven by robust

cash management and collection initiatives. Our cash management
solutions are designed to integrate with our clients’ business systems
and are delivered via our Internet banking system, OMNI host-to-host
delivery channel, and SWIFT.
1,924 2,446

2015 2016

Profit before Tax - GH¢ m

The reduction in profit before tax was largely due to additional loan impairment. Compared to
prior year, impairment provisioning went up by GH¢ 41m (+38%). Operating cost also went up by
13% year on year driven by cost pressures arising from high inflation during the year. Overall, profit

273 253
before tax was 8% lower than prior year.

2015 2016

Loans - GH¢ m

Growth in our loan book shows our continued support to our clients’
business. Total loans and advances to customers grew by 18% underlined
by strong annuity income. The CIB loan book remained healthy with a
low NPL ratio of 4% compared to industry ratio of 11%.
2,629 3,096

2015 2016

Ecobank Ghana Annual Report 2016 23

24 Ecobank Ghana Annual Report 2016
Ecobank Ghana Annual Report 2016 25
 We have consistently remained amongst the highest
financial industry, demonstrating the viability of our

26 Ecobank Ghana Annual Report 2016

 Chairman’s Address

DEAR SHAREHOLDERS
I have the pleasure to welcome you to another Annual General meeting of Ecobank Ghana Limited and once again
present the Annual report for the year ended December 31, 2016.

Although the year 2016 was bedeviled with various challenges especially at the macroeconomic and industry
levels, we were able to overcome these challenges and return profitability to our shareholders due to the solid
fundamentals that we have built as a bank in the past years.

I would like to take this opportunity to introduce to you our new Managing Director, Mr. Daniel Nii Kwei-Kumah
Sackey, who took over in September last year. Prior to this appointment, Dan was the Managing Director for
Ecobank Zimbabwe and Cluster Head for the Southern Africa Development Community (SADC) zone. Dan had been
responsible for driving Ecobank’s businesses in Zimbabwe, Zambia, Malawi, Mozambique and Democratic Republic
of Congo. Most importantly, he is one of our own, having started his career here in Ecobank Ghana and rising to the
position of Country Risk Manager for Ghana. I have no doubt that he will lead Ecobank Ghana to the next level and
establish a bank that will continue to be a market leader in all facets. Congratulations Dan and welcome on board. I
also take this opportunity to thank Mr. Samuel Ashitey Adjei for the outstanding work done.

Let me give you a brief review of our operating environment before delving into our financial performance and
other activities for the year.

performers in terms of RETURN ON EQUITY in the

bank as a premier destination for investor funds.

Ecobank Ghana Annual Report 2016 27

Chairman’s Address

Macro-economic review other investments to provide optimum liquidity.

Our capital adequacy ratio of 15.29% maintains a healthy mark-up on
the regulatory requirement of 10% and is a result of the high standards
According to the IMF’s World Economic Outlook (WEO) report for
of capital management we have set for ourselves to ensure that our
January 2017, economic activity across the globe is projected to pick up
business continues to run even in the most unlikely and unpredictable of
pace in 2017 and 2018, especially in emerging markets and developing
economic scenarios.
economies. However, there is a wide range of possible outcomes around
the projections, given uncertainty surrounding the policy stance of the
The Bank continues to demonstrate its resilience with a commendable
new U.S. administration, Brexit and its global ramifications.
return on equity of 35% in the year under review.

Ecobank Research’s Middle Africa Report for 2017 projects that economic
growth in Sub-Saharan Africa (SSA) is likely to quicken this year to a
forecasted 2.8%, after a lacklustre growth rate of an estimated 1.6% in Dividend
2016. Growth will be supported by improved weather prospects in some
parts of the region (Western and Southern Africa), strong population The Board has proposed a dividend of 82 Ghana pesewas per share. The
growth, large investments in infrastructure and mining, and robust dividend payment will represent a payout ratio of 99% after transfers to
demand for goods and services (particularly ICT, Fintech and FMCG), and regulatory and statutory reserves.
a rebound in demand for exports amid an improving global commodity
price outlook. We have consistently remained amongst the highest performers in terms
of Return on Equity in the financial industry, demonstrating the viability of
On the local front, after a period of significant economic challenges in 2015 our bank as a premier destination for investor funds.
which resulted in a slower GDP growth, accelerated depreciation of the
Ghana cedi and a high inflation, the various reforms implemented under
the IMF program resulted in some improvement in the macroeconomic Board Changes
environment in 2016. The challenges with the power sector subsided
significantly and the Ghana cedi stabilized relative to the previous year. In 2016, our Head of Consumer banking, Mr. George Mensah-Asante was
GDP growth is estimated at 3.6% for 2016 and is expected to pick up seconded to our affiliate in Liberia as Managing Director and has since
significantly to 6.3% in 2017. resigned from the Ecobank Ghana Board. Madam Evelyne Tall, after an
impeccable six year tenure on the Board, has also moved on. Early this
year, Mr. Ernest Thompson also stepped down from the board.
Financial Review
On behalf of the entire Board, I wish to express our sincerest appreciation
Despite the tough operating environment, we ended the year 2016 with to Evelyne, Ernest and George for their outstanding contribution to
total revenue of GHS1.2billion; an 18% growth from 2015’s performance. Ecobank Ghana.
This performance was driven strongly by gains from de-recognition of
financial assets relating to the oil sector.
Corporate Social Responsibility
Net Interest Income increased by 5% from GHS682 million to GHS719
million, while Net Fees and Commission declined by 15% from GHS185 At Ecobank, we have a strong corporate social responsibility philosophy
million to GHS157 million due to lower transaction volumes associated with a keen focus in the areas of education, health, sports and
with the operating environment. Profit before tax amounted to GHC 462.7 environment, among others.
million and was driven downwards by increased loan book impairments.
Impairment charges were up 54% from GHS116 million to GHS179 million. During the year, we offered support to various
Operating cost of GHS566 million was 26% over the previous year. Our educational institutions in Ghana. Examples
cost to income ratio was however still impressive at 46.94%. The ratio include sponsoring the construction of an
compares favourably to the industry average and is a testament to the ultra-modern administration block for the
improvements in our return on assets and successful outcomes of our Village of Hope School at Gomoa Fetteh
cost cutting initiatives. in the Central region in addition to the
ongoing educational scholarships we
The Non-performing loan ratio was 15.87% compared to 18.01% in 2015. have for some selected students. We
In an extremely competitive market and faced with tightening liquidity, we have maintained our partnership with
have grown deposits by 12% over the previous year. Non-interest bearing the National Partnership for Children’s
deposits constitute the bulk of deposits at 75% of total deposits. Trust and are currently sponsoring
19 underprivileged students in
We have maintained a positive liquidity gap. To shore up our liquidity various Senior High Schools. We
position, our portfolio of instruments is well diversified in currency and equipped the computer laboratory of

28 Ecobank Ghana Annual Report 2016

the La Nkwantanang Schools with air conditioners in addition to the 20 We also provided funding support for projects undertaken by various
computers donated in 2015 during the Ecobank Day celebrations. Other associations targeted at the micro sector such as Onuapa Foundation and
beneficiaries in the area of education included The Ghana College of Adawso Development Association amongst others.
Physicians and Surgeons, University of Ghana-Department of Surgery,
and University of Ghana Office of Research amongst others. The value of such support to those who need it most cannot be
underestimated, and we will continue to work tirelessly towards the
In partnership with MyAfrica Thriving Foundation, Ecobank Ghana through realisation of a better Africa in all spheres of life.
the Ecobank Foundation funded a model school project in Agbogba,
Accra. The primary objective of the project is to, as part of the Ecobank
vision, and its foundation strategy, strengthen government public schools Appreciation
by improving teaching conditions for pupils, teachers and the community.
Following the ground breaking ceremony held on 5th September 2016, Let me conclude by thanking our Management and Staff for their
the construction will be completed in 2017. continuous devotion to ensuring that we have a successful and thriving
bank.
In the health sector, we collaborated with the Children Heart Foundation
to sponsor the heart surgery of three children. To our customers, we value your business with us and acknowledge that
without you we would not have a bank to run, thank you.
Ecobank Ghana organised its maiden institutionalised internal blood
donation exercise dubbed ‘Blood is life’ to re-stock the blood banks of To our shareholders, your continuous support and investments are the
two major hospitals of the country to save the lives of people in need. driving forces to what we achieve and we thank you for your loyalty over
The exercise was undertaken in collaboration with the National Blood the years.
Transfusion Services. The program yielded over 100 pints of blood
donated by employees of the bank. Most importantly we give thanks to God Almighty for another successful
year and look forward to His guidance in the coming years as well.
We donated air conditioners to the Emergency Unit and Eye Clinic of
the Korle-Bu Teaching hospital and supported other organisations like Thank you and God bless us all.
BreastCare International and the National Diabetes Association.

The bank continued its support to the Small and Medium Enterprises
(SME) sector in terms of the SME’s access to skills, markets and finance
Terence Ronald Darko
BOARD CHAIRMAN
through its partnership with Invest In Africa. In particular, the African
Partner Pool (APP) makes it easier for large international and domestic
companies to find and work with local suppliers in Ghana. It also provides
a platform for businesses in Ghana to promote their products and services
to international and domestic buyers and view tender opportunities.

Ecobank Ghana Annual Report 2016 29

 I take this opportunity to reaffirm my
positively to the Bank’s next phase of

30 Ecobank Ghana Annual Report 2016

 Managing Director’s Address
With extensive banking experience, Mr Daniel Nii Kwei-Kumah Sackey,
takes over as Managing Director from September 2016

DEAR SHAREHOLDERS

It is my pleasure to address this assembly and to welcome you all to our Annual General Meeting. I
took over as Managing Director of our bank in September 2016, poised to build on the exceptional
work done by my predecessor, Mr. Samuel Ashitey Adjei and the entire team over the past 10
years. Due to the excellent work done by the team, we can today boast of a robust and market-
leading business, set on a horizon to achieve more. I must acknowledge Sam for providing the
strong leadership that has positioned the Bank as a market leader in the financial sector. I take this
opportunity to reaffirm my commitment towards contributing positively to the Bank’s next phase of
growth, innovation and profitability.

The face of financial services has evolved in the last few years with an increasing move toward
digitisation, resulting in a major shift in the channels for financial services delivery. The critical
success factors for our business have moved away from just our physical ”brick and mortar”
presence to what I call our “virtual presence”. Attendant to this is the increased competition from not
only financial institutions but also non-financial institutions who also offer mobile financial services.

Banking today has taken on a new reality where unrestricted access to financial services and
reliability of delivery channels have become a basic demand from our customers, and it is incumbent
on us to constantly innovate if we are to remain relevant in this fast-paced industry. Investment in
technology is required to support innovation and also to provide the scale to enable us handle our
growing client base. Such investment is also required in order to respond adequately to on going
effort by Government to promote financial inclusion by making sure that financial products and
services reach a wider client base at an affordable price.

commitment towards contributing

GROWTH, INNOVATION and PROFITABILITY.

Ecobank Ghana Annual Report 2016 31

Managing Director’s Address

ECOBANK GOES DIGITAL Exchange Rate

We are committed to deepening financial inclusion, by leveraging the rising After a period of relative stability, the Ghana cedi’s depreciation against
trends in mobile adoption across the country to improve convenience and the USD gained momentum on the back of increased demand for imports
accessibility for you, our cherished clients. and speculations around the 2016 elections. During the year under review
the Ghana cedi had depreciated by 9.5% and was quoted at GHS4.18 to
During the year 2016, we launched the Ecobank Mobile App. It is the first the USD as at the end of the year. However compared to 2015 the pace of
unified app delivered by any institution for use in 33 countries. Ecobank currency depreciation has been slower with the Ghana cedi depreciating
customers can now make instant payments to and receive funds from any by 15.7% in December 2015.
bank within the country and across all the 33 countries in Africa where
we have a presence, with just a few clicks. It also enables consumers to Going forward, expected earnings from the TEN and Sankofa oil fields,
open a new digital account, the Ecobank Xpress account, in a matter of coupled with expected higher prices for a number of Ghana’s commodity
minutes. We recognise this as a key milestone in Ecobank’s journey to exports, should help to shore up the Ghana cedi.
market leadership. Our Tbill 4All product which was launched in 2016,
has immediately proven to be a flagship product that allows customers to Interest Rate
purchase treasury bills via their mobile phones. It is easy, it is convenient
but most importantly it promotes our financial inclusion agenda and During the year under review; the Central Bank reduced its policy rate by
fosters a savings culture amongst our retail customers. We also recently 50 basis points to 25.5% from 26% citing subsiding inflationary pressures
launched our Ecobank Masterpass QR, a secure and cost effective way to and tight financing conditions that pose risks to the economic outlook.
make and receive payments. This reflects the Central Bank’s growing confidence in containing inflation
and stabilising the currency.
Looking ahead, our prospects as a market leader continue to be
unequivocally bright, and working together, we will help shape the future As a result, yields have begun to decline, particularly in relation to short
of banking in Ghana. term maturities. The 91-day T-bill rate declined by just over 500 basis points
during the year under review to 16.34%, whilst the 1-Year note dropped
ECONOMIC REVIEW OF 2016 by 200 basis points to 21%. The decline in yields reflects Government’s
ongoing drive to reduce expenditure and increased investor confidence
After the peaceful presidential elections, we expect broad economic policy given growing signs of lower inflation. T-bill yields are likely to fall on the
implementation to continue under the new administration. In particular, back of further policy rate cuts and on-going fiscal reforms, should they
ongoing engagement with the IMF under the three-year Extended Credit continue.
Facility is expected to continue. The outlook for the economy is positive
with growth expected to pick up to 6.3% in 2017 on the back of new
oil & gas discoveries from the TEN and Sankofa fields and the upward Banking Sector
trajectory in business confidence.
There are currently a total of 33 banks in the industry with the recent entry
We expect Ghana’s banking sector to record stronger growth in 2017 of four new players; namely Sovereign Bank, Heritage Bank, Premium
as the economy rebounds by way of real GDP growth on the back of an Bank and Omni Bank.
improved contribution from the oil sector and the timely resolution of
the outstanding Bulk Oil Distributing Companies (BDCs) loan challenges. The Central Bank has indicated that, it will be issuing new directives
concerning minimum capital requirement and capital
adequacy ratios with the aim of strengthening
Inflation the industry. Loan asset quality continues
to impact adversely on the banking
Inflationary pressures have begun to trend downwards with December’s sector, driven largely by the delayed
inflation stated at 15.4% from the 17.7% in December 2015. At the resolution of the BDCs loan book.
regional level, the year-on-year inflation rate ranged from 13.0 % in the
Northern Region to 18.2% in the Greater Accra Region.
Food inflation stood at 9.7% compared to 8.0% in December 2015.
The non-food group recorded a year-on-year inflation rate of 18.2% in
December 2016, compared to the 23.3% for December 2015. Inflation is
projected to end the year at 11.2%.

32 Ecobank Ghana Annual Report 2016

Financial Review Our ultimate goal is to better serve our customers with bespoke products
and services tailored to their unique financial needs.
Ecobank Ghana reported a pre-tax profit of GHC462.7m for 2016, this was
impacted negatively by an increase in impairment charges and a relatively Out of our total revenue of GHS1.2 billion in 2016; Corporate Banking
lower loan growth in 2016. contributed 52% of this with Consumer and Commercial Banking
contributing 29% and 19% respectively.
Net interest income was up 5% from GHS682 million to GHS719 million
as a result of a deliberate strategy to slow down the loan book growth, We recognise the contribution of our dedicated workforce towards this
pending resolution of the oil sector related loan issues. Net Fees & performance and we will to continue incentivising our employees towards
Commissions income and Trading income declined by 15% and 6% greater commitment in serving our customers.
respectively; on the back of reduced transaction volumes, particularly oil
related trade finance transactions. Overall, total revenue grew by 18% in Closing Remarks
2016 to GHS1.2 billion.
My gratitude goes first to God for seeing us through another successful
Operating expenses amounted to GHS566 million in 2016 and was year. His guidance enables us to make sound decisions that yield positive
mainly driven by the ongoing investment in technology and increase in results. I thank our Board of Directors for their commitment towards the
the general cost of living. The Bank’s Cost to Income ratio at 46.94% is strengthening of this institution. I thank our parent company, Ecobank
marginally higher than the 2015 figure of 44%. Transnational Incorporated for their immense support throughout the
years.
Our net customer loans increased by a modest 12% to GHS3.5 billion.
This was as a result of the aforementioned deliberate strategy to slow The efficient management of our resources testifies to the strength
down the loan book growth. Customer deposits rose 12% year-on-year and resilience of our people. The disciplined and constructive attitude
to GHS5.4 billion. maintained by our employees throughout the year, together with their
proactive and rigorous management of risk, liquidity and costs, is very
Overall, our asset size stood at GHS8 billion as of December 2016 from commendable. My warmest appreciation goes to the entire staff.
GHS6.7 billion in 2015, marking a growth rate of 21%. With a networth of
GHS964 million, our ability to lead big-ticket deals places us on course to On behalf of the management and staff of Ecobank, I thank our
extract maximum value for increased shareholder return. shareholders and customers for keeping faith with us. We are committed
to moving forward in 2017 and will continue to honour the confidence
In 2016, we re-aligned our business divisions from the erstwhile reposed in the Ecobank brand.
categorisation of Corporate, Domestic and Treasury to the following:

• Corporate Bank (made up of Governments, Regional & Global Thank you all.
Corporates and Financial Institutions & International organisations)

• Commercial Bank (made up of SMEs, Medium & Local Corporates,

Non-Government public sector and schools and churches)
Daniel Nii Kwei-KumahSackey
MANAGING DIRECTOR
• Consumer Bank (made up of Premier, Advantage, Classic & Direct
customers).

Ecobank Ghana Annual Report 2016 33

 At Ecobank Ghana, we recognize the role that
we remain in business. GIVING BACK to these

34 Ecobank Ghana Annual Report 2016

 Corporate Social
Responsibility

INTRODUCTION

At both the corporate and individual level,

our staff are engaged in various activities
aimed at the growth and development of
the people and communities we serve.

MAIN CORPORATE SOCIAL

RESPONSIBILITY (CSR) EVENTS IN 2016

In 2016, we continued with our CSR

programs with a key focus on the
following areas;

- Education
- Health
- Financial Inclusion
- Others

Overall we spent a total of GH¢ 3.38

million on our CSR activities this year, an
SOD CUTTING CEREMONY FOR A MODEL increase of 19% in the figure for last year
SCHOOL PROJECT IN AGBOGBA, ACCRA of GH¢ 2.84 million.

our communities play in ensuring that

communities is a core objective for us.

Ecobank Ghana Annual Report 2016 35

 Corporate Social Responsibility

SOME OF THE MAJOR PROJECTS UNDERTAKEN INCLUDED

EDUCATION
VILLAGE OF HOPE GHANA COLLEGE OF PHYSICIANS AND UNIVERSITY OF GHANA – DEPARTMENT
Village of Hope School, located at Gomoa SURGEONS OF SURGERY
Fetteh offers education, social support and Ghana College of Physicians and Surgeons Ecobank Ghana fully sponsored the
care to the orphaned, abandoned, destitute is a post-graduate medical training college Department of Surgery of the University
and needy children. Over the years, Ecobank set up to organize and supervise specialist of Ghana Medical School to print the 5th
has supported many of the children by training and to promote continuous edition of the Baja’s principles of surgery
providing full scholarship to enable them professional development and support which covers all aspects of surgery. The
attain higher education. In 2015, Ecobank post-graduate research in medicine, books will help in the teaching and training
Ghana sponsored the construction of surgery and related medicines. Ecobank of the subject in medical schools in Ghana
an ultra-modern Administration block donated an amount of GH¢97,000 into their and also aid referencing for both medical
to facilitate the smooth running of endowment fund to augment the resources professors and students on the subject.
administrative activities in the school. This of the college to enable it deliver on its
was completed and handed over in 2016. mandate of post-graduate medical training. ECOBANK FOUNDATION - MODEL
SCHOOL PROJECT
LA NKWANTANANG SCHOOL SUPPORT FOR MEDICAL STUDENTS Ecobank Foundation supports social
La Nkwantanang basic school which is In line with its vision of contributing to projects in Africa and has the focus of giving
located at Madina received a donation of Air the economic development and financial back to the societies in which the Bank
Conditioners for its ICT laboratory. This is integration of Africa, Ecobank sponsored operates. In partnership with MyAfrica
in addition to the 20 computers donated in 17 medical students from two of the public Thriving International, the foundation
2015 during our Ecobank Day celebrations. medical schools in Ghana i.e. University of commenced a maiden project in Ghana;
Cape Coast and University of Ghana Legon, “the model school project”. This is an
NATIONAL PARTNERSHIP FOR to attend various exchange programs in initiative which seeks to rebuild five schools
CHILDREN’S TRUST (NPCT) order to gain more experience in the field in selected deprived communities, with
NPCT is a child focused and a non-profit of medicine. the aim of transforming education in the
organisation which is run by a board of country. The construction of the first of
trustees. Ecobank Ghana is a life trustee of UG-OFFICE OF RESEARCH, INNOVATION first school is ongoing at Agbogba-Haatso,
the Organisation and has been supporting AND DEVELOPMENT a suburb of Accra. The Ecobank Foundation
children through the senior high school Office of Research, Innovation and by this project is fulfilling the objective of
and the Universities over the years. Development is the research management making quality education accessible to all
Currently Ecobank Ghana is sponsoring 19 arm of the University of Ghana and has irrespective of social standing.
underprivileged students in SHS. the mission to promote and facilitate the
research activities of the University. This CHARTERED INSTITUTE OF BANKERS
ECOBANK MENTORING PROGRAM department received sponsorship from (CIB)
Ecobank Ghana collaborated with Africa Ecobank for procurement and shipment of Ecobank Ghana sponsored CIB’s initiative of
Business Centre for Developing Education 50 medical books which were distributed educating the public on banking terms and
(ABCDE) an NGO to mentor students in to five public medical schools in Ghana processes, through a 52 week newspaper
the Senior High Schools. The bank has also to enrich their academic study and publications. The publications reached over
procured a projector and Screen for ABCDE development. 150,000 people through the Daily Graphic.
to support the mentoring programs.

SCHOLARSHIPS COMMISSIONING OF ADMIN BLOCK DONATION OF BAJA BOOKS

36 Ecobank Ghana Annual Report 2016

HEALTH
THE CHILDREN’S HEART FOUNDATION
The Children’s Heart Foundation is a group of volunteers who are dedicated
to raising funds for the purposes of improving the lives of children and
families that are affected by congenital Heart Diseases. Ecobank has
sponsored numerous children over the years for heart surgeries. In 2016,
Ecobank fully sponsored three children undergoing open heart surgeries to
the tune of USD 20,000.

KORLE-BU TEACHING HOSPITAL

Ecobank Ghana donated 7 Air Conditioners to the Emergency Unit and the
Eye Clinic of the leading Teaching Hospital Ghana, Korle-Bu to support the
health needs of staff and patients of the hospital.

BLOOD DONATION
Ecobank Ghana organized its maiden institutionalized blood donation
exercise dubbed ‘Blood is life’ to stock blood at the major hospitals of the
country to help save the lives of people. The exercise was undertaken in
collaboration with the National Blood Transfusion Services.The program
yielded over 100 pints of blood donated by employees of the bank.
CHILD HEART SURGERY SPONSORSHIP
BREASTCARE INTERNATIONAL
Breast Care International Ghana (BCI) is a Kumasi-based organization
that seeks to intensify breast cancer awareness in Ghana especially in the
remote communities to demystify breast cancer. Ecobank Ghana sponsored
a health walk to create awareness of Breast cancer as the principal cause of
death and its devastating effect among women.

NATIONAL DIABETES ASSOCIATION

Ecobank Ghana sponsored the National Diabetes Association to create
awareness on the prevalence of diabetes to commemorate World Health
Day. Over 500 people across the country received free diabetes screening
as well as counselling on how to avoid or manage the condition.

ONUAPA FOUNDATION
Onuapa Foundation is an organization in the Eastern Region which offers
free medical screening on an annual basis to the underprivileged elderly
in the Eastern Region and its environs. In 2016 Ecobank sponsored the
medical screening of 60 elderly people in Somanya in the Eastern Region.
Ecobank has been sponsoring this project for the past three years.

ADAWSO DEVELOPMENT ASSOCIATION

FREE MEDICAL SCREENING FOR THE AGED
The people of Adawso, a community in the Eastern Region and its environs,
get their source of drinking water from a stream nearby which dries up in
the dry season and which is mostly contaminated due to residential sewers
that flow into the stream. The Adawso Development Association initiated a
water project and Ecobank supported the drilling of boreholes and tanks to
provide safe drinking water for the Community.

Ecobank Ghana Annual Report 2016 37

FREE DIABETIC SCREENING
 Ecobank Ghana
Sustainability Report 2016

38 Ecobank Ghana Annual Report 2016

INTRODUCTION THE GREEN CLIMATE FUND (GCF)
ACCREDITATION
Ecobank Ghana Limited is committed to continuous growth and steady
progress in its corporate sustainability stewardship. Guiding us in this In Ghana, Ecobank is recognised as a thought leader with informed
direction are our core values which include the following: opinion in the field of sustainable banking by the government bodies,
international agencies and regulators. In line with this Ecobank Ghana
has received a ‘No objection’ from the National Designated Authority
FOCUS ON THE CUSTOMER (Ministry of Finance) to submit an application to the Green Climate
Fund (GCF) to be accredited as a National Implementing Entity (NIE).

KEEP IT SIMPLE
Upon successful accreditation we will be in a position to assist the
Government to achieve the objectives of the Ghana Nationally
BE A LEADER Determined Contribution (GH-NDC) and in particular execute projects
in the under listed priority sectors as established in the GH-INDC
BE INNOVATIVE document of September 2015

KEEP YOUR COMMITMENTS

SUSTAINABLE LAND USE

BE OPEN INCLUDING FOOD SECURITY

CLIMATE PROOF
MAKE A DIFFERENCE
INFRASTRUCTURE

PROUDLY AFRICAN EQUITABLE SOCIAL

DEVELOPMENT

SUSTAINABLE ENERGY
SECURITY
To help accomplish our mission and guided by these core values,
Ecobank Ghana seeks to improve environmental development and
SUSTAINABLE FOREST
social advancement as well as conduct business in a way that generates
MANAGEMENT
value for the bank, our customers as well as future generations.

The Bank is motivated by responsibilities to its customers, shareholders ALTERNATIVE URBAN

and employees, as well as its concern for the society, the environment, WASTE MANAGEMENT
government regulation and other stakeholder interests. Ecobank’s
corporate sustainability stewardship will continue to be strongly linked
to our mission and business strategy. We will also continue to explore
a healthy relationship between business growth and sustainability. In
this respect, we will focus our sustainability efforts on areas where we
can accomplish the greatest impact.

Ecobank Ghana Annual Report 2016 39

Ecobank Ghana Sustainability report 2016

GLOBAL INITIATIVE

Ecobank Ghana Limited continues to ensure that its commitment to sustainability goes beyond compliance with legal requirements, representing an
effective tool for sharing competitive knowledge and strengthening networking opportunities.

Subsequently, Ecobank Ghana in collaboration with the Alliance for Integrity (AfIn) trained two members of staff in a Train the Trainer programme on
compliance management. The training was based on international good practices and tried-and-tested solutions developed by the Global Compact
Network Germany and delivered by an expert in the field of compliance. We share in the conviction that when businesses embrace integrity it ensures
their growth and the development of the entire business environment. The AfIn is a business driven multi-stakeholder initiative between private
sector, civil society, political organisations and international institutions. Following the successful completion of the train the trainer programme , the
staff of Ecobank Ghana in consultation with AfIn organised compliance management training for SMEs in Takoradi.

The combination of international good practices, knowledge transfer and experience in implementing compliance management activities, made the
training programme valuable for SMEs. The training dubbed ‘Compliance Management – How to increase your competitive advantage’ was organised
on September 15, 2016 at Takoradi and was attended by a total of 28 participants.

Cross section of participants at a group discussion during the compliance training – photo credit GIZ GmbH

SUSTAINABILITY AND BUSINESS GROWTH approvals.

Our strategy to create value while pursuing innovation has created Ecobank Ghana continues to chair the Ghana Sustainable Banking
positive impact on the environment. The fact that as a company Steering Committee established by the Bank of Ghana to facilitate
expands so does its carbon footprints from its business activities is constructive dialogue between the Ghana Association of Banks (GABs),
well-established. However, in Ecobank Ghana, through a variety of Bank of Ghana (BOG) and Ghana Environmental Protection Agency
initiatives such as the Electronic Records and Document Management as well as other stakeholders, including international organisations,
System (ERDMS), we have been able defy this assumption by reducing governments and non-governmental organisations. The committees’
paper usage and its negative impacts on deforestation and greenhouse work includes among other things ensuring that banking and investment
gas emissions, while simultaneously increasing business activities. For activities are carried out in line with international best-practices in
third party over the counter cash withdrawals: A paperless system was sustainable banking, and with due regard to the Ghanaian context. To
employed thereby reducing the use of paper by 20%. this we are fully committed and will continue to support this laudable
initiative to its logical conclusion.
On November 16, 2016 the bank rolled out the unified Ecobank Mobile
App. This uniquely leverages the power of a digital platform to deliver
real convenience to our customers and gives us the scale and capacity
to provide services to our customers in a profitable and sustainable
way. The bank further enforced the use of a digital means for its internal
processes such as procurement, travel arrangements and other requisite

40 Ecobank Ghana Annual Report 2016

Accounts | Cards | Loans | Payments and Transfers

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ecobank.com Ecobank Ghana Annual Report 2016 41

42 Ecobank Ghana Annual Report 2016
Ecobank Ghana Annual Report 2016 43
Ecobank Ghana Limited
Financial Statements - 31 December 2016

44 Ecobank Ghana Annual Report 2016

REPORT OF THE DIRECTORS TO THE MEMBERS OF ECOBANK GHANA LIMITED

The Directors submit their report together with the financial statements of the Bank and its subsidiaries (together the Group) for the
year ended 31 December 2016.

DIRECTORS’ RESPONSIBILITY STATEMENT

The Directors are responsible for the preparation of consolidated and separate financial statements that give a true and fair view of
Ecobank Ghana Limited comprising the statements of financial position as at 31 December 2016 and the statements of profit or loss
and other comprehensive income, changes in equity and cash flows for the year then ended and the notes to the financial statements
which include a summary of significant accounting policies and other explanatory notes, in accordance with International Financial
Reporting Standards and in the manner required by the Companies Act, 1963 (Act 179) and the Banking Act, 2004 (Act 673) as amended
by the Banking (Amendment) Act, 2007 (Act 738). In addition, the Directors are responsible for the preparation of the Directors’ report.

The Directors are also responsible for such internal control as the Directors determine is necessary to enable the preparation of
financial statements that are free from material misstatement, whether due to fraud or error, and for maintaining adequate account-
ing records and an effective system of risk management. The Directors have made an assessment of the ability of the Bank and its
subsidiaries (“the Group”) to continue as going concerns and have no reason to believe that the businesses will not be going concerns
in the year ahead.

The auditor is responsible for reporting on whether the consolidated and separate financial statements give a true and fair view in
accordance with the applicable financial reporting framework and laws and regulations.

PRINCIPAL ACTIVITIES

The Bank is registered to carry on the business of banking. Its principal activities comprise corporate, commercial, investment and
retail banking. There was no change in the nature of business of the Bank’s business during the year.

FINANCIAL STATEMENTS AND DIVIDEND

The financial results of the Bank for the year ended 31 December 2016 are set out in the attached financial statements, highlights of
which are as follows:

2016 2015
GH¢’000
GH¢’000

Profit after tax (attributable to equity holders) 325,594 327,523

to which is added the balance brought forward
on income surplus account of 263,775 249,030

589,369 576,553

out of which is transferred to the statutory reserve

fund in accordance with the Banking Act an amount of (40,700) (40,940)
transfers to the credit risk reserve of (42,279) (40,188)
and dividend paid of (246,312) (231,650)

(329,291) (312,778)

leaving a balance to be carried forward in the

Income Surplus account of 260,078 263,775

Ecobank Ghana Annual Report 2016 45

Annual Report

REPORT OF THE DIRECTORS TO THE MEMBERS OF ECOBANK GHANA LIMITED

In accordance with section 29(c) of the Banking Act, 2004, (Act 673) as amended, an amount of GH¢40.7 million (2015: GH¢40.9 million)
was transferred to the statutory reserve fund from the income surplus account bringing the cumulative balance on the statutory
reserve fund at the reporting date of 31 December 2016 to GH¢322.6 million (2015: GH¢281.9 million).

The Directors recommend the payment of a dividend of 82 Ghana pesewas (2015:84 Ghana pesewas) per share amounting to
GH¢240,447,265.04 (2015: GH¢246,311,832.48).

The Directors consider the state of the Bank and the Group’s affairs to be satisfactory.

OBJECTIVES OF THE BANK

The objective of the Bank is to build a world-class bank seeking to provide its customers with convenient and reliable banking and
financial products and services both locally and regionally.

SUBSIDIARIES AND ASSOCIATES

The Bank has the following wholly owned subsidiaries, which are incorporated in Ghana and provide the following services:

o Ecobank Investments Managers Limited - Management of investments

o Ecobank Leasing Company Limited - Finance lease facilities
o Ecobank Venture Capital Fund 1 limited - Venture capital
o Ecobank Capital Advisors Limited - Fund management

The Bank holds a 49% interest in Pan African Savings and Loans Company Limited, a company incorporated in Ghana which provides
microfinance to small and medium-sized enterprises.

RELATED PARTY TRANSACTIONS

Information regarding Directors’ interests in ordinary shares of the Bank and remuneration is disclosed in note 44 to the financial
statements. No Director has any other interest in any shares or loan stock of any Group company. Other than service contracts
relating to appointment agreements, no Director had a material interest in any contract to which any Group company was a party
during the year. Related party transactions and balances are also disclosed in note 43 to the financial statements.

AUDITOR

The Audit Committee has responsibility delegated from the Board of Directors for making recommendations on the appointment,
reappointment, removal and remuneration of the external auditor. KPMG has been the auditor of the Bank commencing with the
financial statements for the year ended 31 December 2011.

46 Ecobank Ghana Annual Report 2016

REPORT OF THE DIRECTORS TO THE MEMBERS OF ECOBANK GHANA LIMITED
BOARD OF DIRECTORS - PROFILE

NON-EXECUTIVE QUALIFICATION OUTSIDE BOARD AND POSITION HELD

MANAGEMENT POSITION

Terence Ronald Darko BSc Business Studies Mechanical Lloyd Company Managing Director
Private Enterprises Federation Director
Edendale Properties Limited Director

Thomas Chukwuemeka Awagu MSc Architecture Pyramids Plc Director

Pressto Cleaning Services Director

Martin Eson-Benjamin BSc Administration CFAO Ghana Limited Director

Enterprise Group Limited Director
Enterprise Properties Limited Director
A&C Dev Company Limited Director
Enterprise Insurance Co Limited Director
Advisory Board, College of Health
Sciences, University of Ghana Chairman
Millennium Development Authority Director

Felicity Acquah BA (Hons) Bayport Financial Services Limited Director

(Economics & Law) Camelot Company Limited Director
EMBA Finance

Samuel Ashitey Adjei BSc Statistics Ecobank Cameroon Director

MBA Finance Ecobank Zimbabwe Director
Ecobank Kenya Managing Director
eProcess International SA Director

Rosemary Yeboah BA (Hons) Economics

MA, Economics EDC Stockbrokers Limited Director
MBA

EXECUTIVE
Daniel Nii Kwei-Kumah Sackey BSc Administration eProcess International SA Director
MBA Ecobank Guinea Director
Ecobank Liberia Director
Ecobank Investment Managers Limited Chairman
Ecobank Leasing Co Limited Chairman
Ecobank Venture Capital Fund 1 Chairman
Ecobank Capital Advisors Limited Chairman

Morgan Fianko Asiedu BA (Hons) Law & Sociology Abba-Ponenna Limited Director
EMBA Pioneers Ghana Scripture Union Chairman

Edward Nartey Botchway BA (Hons) Economics Ecobank Investment Managers Limited Director
MA (Applied Business Ecobank Venture Capital Fund 1 Director
Research) Ecobank Leasing Company Limited Director
CA (Ghana) Ecobank Capital Advisors Limited Director
FCCA (UK)

Ecobank Ghana Annual Report 2016 47

Annual Report

REPORT OF THE DIRECTORS TO THE MEMBERS OF ECOBANK GHANA LIMITED

BIOGRAPHICAL INFORMATION OF DIRECTORS

Age category Number of directors
Up to 40 years N/A
41 – 60 5
Above 60 years 4

ROLE OF THE BOARD

The Directors are responsible for the long term success of the Group. They determine the strategic direction of the Group and
review operating, financial and risk performance. There is a formal schedule of matters reserved for the Board of Directors, including
approval of the Group’s annual business plan, the Group’s strategy, acquisitions, disposals and capital expenditure projects above
certain thresholds, all guarantees, treasury policies, the financial statements, the Bank’s dividend policy, transactions involving the
issue or purchase of shares, borrowing powers, appointments to the Board, alterations to the regulations, legal actions brought
by or against the Group and the scope of delegations to Board committees, subsidiary boards and the management committee.
Responsibility for the development of policy and strategy and operational management is delegated to a management committee,
which as at the date of this report includes the executive directors and eleven (12) senior managers.

INTERNAL CONTROL SYSTEMS

The Directors have overall responsibility for the Group’s internal control systems. The Directors annually review the effectiveness
of internal controls, including a review of financial, operational, compliance and risk management controls. The implementation
and maintenance of the risk management and internal control systems are the responsibility of the Executive Directors and other
senior management. The systems are designed to manage rather than eliminate the risk of failure to achieve business objectives
and to provide reasonable, but not absolute, assurance against material misstatement or loss. The Directors have reviewed the
effectiveness of the internal control systems, including controls related to financial, operational and reputational risks identified by
the Group as at the reporting date and no significant failings or weaknesses were identified during this review.

DIRECTORS’ PERFORMANCE EVALUATION

Every year the performance and effectiveness of the Board of Directors (the Board), its committees and individual directors are
evaluated. The evaluation is conducted by the completion of detailed and comprehensive written survey questionnaires. The results
of the evaluation is shared with all members of the Board. Overall, it was noted that the Board of Directors and its committees were
operating in an effective manner and performing satisfactorily, with no major issues identified.

PROFESSIONAL DEVELOPMENT AND TRAINING

On appointment to the Board, directors are provided with a full, formal and tailored programme of induction to familiarise them with
the Group’s businesses, the risks and strategic challenges the Group faces, as well as the economic, competitive, legal and regulatory
environment in which the Group operates. A programme of strategic and other reviews, together with the other training provided
during the year, ensures that Directors continually update their skills and knowledge of the Group’s businesses, and the sectors in
which the Group operates and familiarises themselves on risk, regulatory, legal, financial and other developments to enable them to
fulfil effectively their role on the Board and its committees.

48 Ecobank Ghana Annual Report 2016

REPORT OF THE DIRECTORS TO THE MEMBERS OF ECOBANK GHANA LIMITED

CONFLICTS OF INTEREST

The Bank has established appropriate conflicts authorisation procedures, whereby actual or potential conflicts are regularly reviewed
and authorisations sought as appropriate. During the year, no such conflicts arose and no such authorisations were sought.

BOARD BALANCE AND INDEPENDENCE

The composition of the Board of Directors and its committees is regularly reviewed to ensure that the balance and mix of skills,
independence, knowledge and experience is maintained. The Board considers that the Chairman is independent on appointment
and all non-Executive Directors are independent as it pertains to the management of the Bank. The continuing independent and
objective judgement of the non-Executive Directors has been confirmed by the Board of Directors.

CORPORATE RESPONSIBILITY

The Directors confirm that to the best of their knowledge:

• the financial statements, prepared in accordance with applicable laws and the Bank’s financial reporting framework, give a true
and fair view of the Bank’s financial position, performance and cash flows; and

• the state of the Group’s affairs is satisfactory.

HOLDING COMPANY

The Bank is a subsidiary of Ecobank Transnational Incorporated (ETI), a company incorporated in the Republic of Togo. ETI owns
68.93% of the issued ordinary shares of the Bank.

APPROVAL OF THE CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS

The consolidated and separate financial statements of Ecobank Ghana Limited were approved by the Board of Directors on 23
February 2017 and signed on their behalf by

Signed Signed
CHAIRMAN MANAGING DIRECTOR
Terence Ronald Darko Daniel Nii Kwei-Kumah Sackey,

Ecobank Ghana Annual Report 2016 49

Annual Report

CORPORATE GOVERNANCE

COMMITMENT TO CORPORATE GOVERNANCE

Corporate Governance is important to Ecobank as it seeks to implement the ideals of fairness, transparency, accountability and
responsibility in its dealings with all stakeholders. Ecobank recognizes, as a banking group, the critical nature of its relationships with
its Regulators across the Group, in executing its vision and safeguarding the deposits of the general public and other lenders. To this
end, Ecobank ensures that their interests are taken into account in a balanced and transparent manner. Ecobank believes that, only
good governance can deliver sustainable good business performance.

The Ecobank Group Corporate Governance Charter sets out the structures and processes that are followed by the Group to build
credibility, ensure transparency and accountability across the group.

As members of the Ecobank Group, Ecobank Ghana and its subsidiaries operate according to the Ecobank Transnational Incorporated
(ETI) Group principles and practices on corporate governance. The principles and practices therein are based on the Basel Committee
standards on corporate governance, which constitute the best of international practice in this area.

The key guiding principles of the Group’s governance practices are as follows:

(i) Good corporate governance enhances shareholder value

(ii) The respective roles of the shareholders, Board of Directors and management in the governance architecture should be clearly
defined

(iii) The Board of Directors should have majority membership of independent Directors, defined broadly as Directors who are not
employed by the Group or who are not affiliated with organizations with significant financial dealings with the Group.

These principles have further been articulated in a number of corporate documents including the Bank’s Regulations, Rules of
Procedures for Boards, Code of Conduct for Directors and Rules of Business Ethics for staff.

THE BOARD OF DIRECTORS

The Board is responsible for setting the institution’s strategic direction, leading and controlling the Bank and monitoring activities of
executive management.

As of 31 December 2016, the Board of Directors of Ecobank Ghana consisted of ten (10) members made up of an independent
Non-executive Chairman, six (6) Non-executive Directors, four (4) of whom are independent and three (3) Executive Directors. These
board members have wide experience and in-depth knowledge of management, industry and the financial and capital markets,
which enable them make informed decisions and valuable contributions to the Group’s business.

Regarding term limits, a non-executive director shall be elected for a period of 3 years at a time and shall be eligible for re-election
provided that no individual shall serve as a director for a cumulative period of more than nine (9) years. A person who is more than
70 years old shall, subject to local laws retire at the next Annual General Meeting following his/her 70th birthday. An Executive
Director shall retire as Director upon attaining the mandatory retirement age for employees or on termination of their employment
for whatever reason. The term of the Chairman shall not exceed six (6) years.

The Board has adopted standard evaluation tools that help assess the performance of the Board, its committees and individual
members on an annual basis.

The Board and all Directors are also periodically evaluated by an independent external firm in order to assess the effectiveness of the
Board as well as the contribution of the individual Directors

50 Ecobank Ghana Annual Report 2016

CORPORATE GOVERNANCE (CONT’D)

THE BOARD OF DIRECTORS (CONT’D)

The Board met four (4) times during the year and undertook a training programme in the area of risk management for purposes of
professional development.

The Board has delegated various aspects of its work to the Governance, Audit and Compliance, Credit and Risk Management
Committees.

GOVERNANCE COMMITTEE

This Committee is chaired by Mr. Terence Darko (the independent non-executive Board Chairman) and has as its members, Mrs.
Felicity Acquah and Mr. Martin Eson –Benjamin. The Committee met four times in the year ended 31 December 2016.

The role of the Committee includes:

• Handling relationships with regulators and third parties;

• Handling relationships with shareholders;
• Evaluating the performance of Board members and various committees;
• Reviewing all issues relating to good governance; and
• Reviewing and recommending the appointment of Directors.

The role of the Governance Committee with regards to Human Resources includes:

• Periodically reviewing the organizational structure of the Bank to ensure it conforms to the standard Group structure;
• Setting criteria, in line with Group policies, for recruitment of staff;
• Ensuring human resource management policies align with the Group Human Resource policies;
• Evaluating the performance of management staff and making recommendations for approval by the Board;
• Recommending disciplinary actions against erring management staff;
• Recommending appropriate levels of remuneration and packages for staff;
• Reviewing succession plan for key positions; and
• Any other responsibilities as may be assigned by the Board.

AUDIT AND COMPLIANCE COMMITTEE

The Audit and Compliance Committee has as its Chairperson, Mrs. Felicity Acquah, an independent non-executive Director.
This Committee includes three (3) other non-executive members of the Board namely Mr. Terence Darko, Mr. Thomas Chukwuemeka
Awagu and Mr. Ernest Thompson. The Managing Director, Chief Finance Officer, Internal Auditor and if need be, a representative of
the external auditors, sit in attendance. The Committee met four (4) times in the year ended 31 December 2016.

The role of the committee includes:

• Reviewing the internal audit function, its mandate and audit activities;
• Reviewing internal and external audit reports, particularly reports of regulatory and monetary authorities and supervising the
implementation of recommendations;
• Facilitating dialogue between auditors and management on the outcome of audit activities;
• Proposing external auditors and their remuneration;

Ecobank Ghana Annual Report 2016 51

Annual Report

CORPORATE GOVERNANCE (CONT’D)

AUDIT AND COMPLIANCE COMMITTEE (CONT’D)

• Working with the external auditors to finalize the annual financial statements for Board approval;
• Reviewing the dividend policy and issues relating to the constitution of reserves;
• Reviewing quarterly, half-yearly and annual financial results before the Board’s review and approval;
• Setting up procedures for selecting suppliers, consultants and other service providers and ensuring compliance therewith;
• Organizing periodic discussions with the departments of Internal Audit and Finance ;
• Defining appropriate measures to safeguard assets of the Bank;
• Ensuring compliance with all applicable laws and regulations and operating standards;
• Reviewing, approving and following up major contracts, procurement and capital expenditures;
• Reviewing actual spending against budget; and
• Reviewing and approving proposals for extra-budgetary spending.

EXTERNAL AUDITORS

External auditors are appointed through a bidding process and on a rotational basis for a period outlined by the Bank of Ghana’s
regulations. The external auditors present and discuss their audit findings with the Board and Audit & Compliance Committee.
During the year under review, the auditors performed non-audit work relating to tax compliance and surveys for the Bank. Fees for
approved non-audit services amounted to GH¢111,020. The Board has confidence in the independence and integrity of the external
auditors. KPMG our current auditors were appointed in 2011. KPMG has in place internal polices for the rotation of partners for its
clients.

INTERNAL AUDITORS

The Internal Audit function of the Bank reports directly to the Board Audit Committee. Internal Audit provides independent, objective
audit assurance designed to add value and improve the Bank’s operations while ensuring the effectiveness of risk management,
control, and governance processes. The Internal Audit department presents its reports to the Board Audit and Compliance Committee.

RISK MANAGEMENT COMMITTEE

The Committee has as its Chairman, Mr. Thomas Awagu. Other members are Mr. Eson- Benjamin and Mrs. Rosemary Yeboah.

The role of the committee includes:

• Reviewing and approving risk policy changes initiated by Management.

• Ensuring compliance with the Bank’s risk policies and statutory requirements prescribed by the regulatory or supervisory
authorities.
• Reviewing periodic risk management portfolio reports and assess portfolio performance.
• Reviewing operational, market, reputational and legal risk management.
• Approving all credits within limits defined in Group Credit Policy and within the statutory requirements set by the respective
regulatory and supervisory authorities;
• Reviewing and endorsing credits approved by executive management;
• Reviewing and recommending to the full Board, credit policy changes initiated by executive management;
• Ensuring compliance with the Bank’s credit policies and statutory requirements prescribed by the regulatory and supervisory
authorities;
• Reviewing periodic credit portfolio reports and assessing portfolio performance; and
• Approving exceptions, write-offs and discounts of non-performing credit facilities.

52 Ecobank Ghana Annual Report 2016

CORPORATE GOVERNANCE (CONT’D)

BUSINESS CONTINUITY PLAN

The Group has a business continuity and disaster recovery plan for its Head Office and branches that will enable it respond to
unplanned significant interruptions in essential business functions that can lead to the temporary suspension of operations. It
provides guidelines to fully recover operations and ensure coordinated processes of restoring systems, data and infrastructure to
enable essential client needs to be met until normal operations are resumed. The plan is tested at least three times every year to
assess the readiness of the Group to respond to unplanned interruptions of operations.

SYSTEMS OF INTERNAL CONTROL

The Group has a well-established internal control system for identifying, managing and monitoring risks. These are designed to
provide reasonable assurance that risks faced by the Group are reasonably controlled.

The corporate internal audit and compliance function of the Group plays a key role in providing an objective view and continuing
assessment of the effectiveness of the internal control systems in the business. The systems of internal control are implemented
and monitored by appropriately trained personnel, with clearly defined duties and reporting lines.

CODE OF BUSINESS ETHICS

Management has communicated principles in the Group’s Code of Conduct to its employees to provide guidance in the discharge of
their duties. This Code sets the standards of professionalism and integrity required for the Group’s operations. It covers compliance
with applicable laws, conflicts of interest, environmental issues, reliability of financial reporting, bribery and strict adherence to laid
down principles, so as to eliminate the potential for illegal practices.

WHISTLE BLOWING POLICY

The Bank believes in and has adopted highest standards of ethical behaviour to ensure that any form of malpractice is dealt with
and mitigating action taken. Employees are therefore encouraged to uphold these virtues by always acting in good faith and also
alerting the appropriate authority of any identified malpractice, concern or suspicious activity or behaviour within the Bank. In all
cases, employees who blow the whistle in good faith about perceived malpractices or concerns within the Bank shall be protected
by the Bank. The Bank shall blow the whistle whenever its business relationships or customers act in breach with local laws and
regulations or they do not adopt the required ethics required in conducting banking activities. The process for whistle-blowing is well
documented in a policy established by the Bank and made available to all staff.

ANTI-MONEY LAUNDERING

The Group also has an established anti-money laundering system in place in compliance with requirements of Ghana’s Anti-Money
Laundering Act, 2008 (Act 749). These include due diligence for opening new accounts, customer identification, monitoring of high
risk accounts, record keeping and training and sensitisation of staff on money laundering, which assist in reducing regulatory and
reputational risks to its business. Staff members receive training on anti-money laundering policies and practices.

Ecobank Ghana Annual Report 2016 53

Annual Report

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF

ECOBANK GHANA LIMITED

REPORT ON THE AUDIT OF THE CONSOLIDATED AND SEPARATE FINANCIAL

STATEMENTS

Opinion

We have audited the consolidated and separate financial statements of Ecobank Ghana Limited (“the Bank”) and its subsidiaries
(together, ”the Group”), which comprise the consolidated and separate statements of financial position at 31 December 2016 and the
consolidated and separate statements of comprehensive income, statements of changes in equity and statements of cash flows for
the year then ended, and the notes to the financial statements which include a summary of significant accounting policies and other
explanatory notes, as set out on pages 68 - 149.

In our opinion, these financial statements give a true and fair view of the consolidated and separate financial position of Ecobank
Ghana Limited at 31 December 2016, and of its consolidated and separate financial performance and consolidated and separate cash
flows for the year then ended in accordance with International Financial Reporting Standards (IFRSs) and in the manner required by
the Companies Act, 1963 (Act 179), and the Banking Act, 2004 (Act 673) as amended by the Banking (Amendment) Act, 2007 (Act 738).

Basis for Opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards
are further described in the Auditor’s Responsibilities for the Audit of the Consolidated and Separate Financial Statements section of our
report. We are independent of the Group in accordance with the International Ethics Standards Board for Accountants’ Code of
Ethics for Professional Accountants (IESBA Code) together with the ethical requirements that are relevant to our audit of the financial
statements in Ghana, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA
Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated and
separate financial statements of the current period. These matters were addressed in the context of our audit of the consolidated
and separate financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters.

Impairment of loans and advances to customers (GH¢86.6 million).

Refer to Note 24 of the consolidated and separate financial statements.

54 Ecobank Ghana Annual Report 2016

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
ECOBANK GHANA LIMITED (CONT’D)
Key Audit Matters (cont’d)

THE KEY AUDIT MATTER HOW THE MATTER WAS ADDRESSED IN OUR
AUDIT
Impairment Allowance on loans and advances Our procedures included:

The estimation of impairment allowance for loans and advances • Testing the design, implementation and operating
to customers involves complexity and subjectivity in estimating the effectiveness of key controls over capturing, monitoring and
timing and amount of cash flow used in the computation. Loans reporting of loans and advances to customers;
for which there is objective evidence that an impairment event has
occurred are assessed individually for impairment. If there is no • Evaluating the year end impairment models for collective
evidence that an impairment exists on an individual basis, loans are and individual impairment by re-performing calculations
assessed collectively for impairment. and agreeing a sample of data inputs to source
documentation;
Assessing impairment allowances on loans and advances to
customers requires management to make assumptions about • For individually significant impaired loans, we assessed the
financial conditions and the timing of expected future cash flows. appropriateness of estimated cashflows, including
Cash flows are determined from collateral values and/or contractual reasonableness of collateral values used, the appropriateness
arrangements which are supported with appropriate documents. of effective interest rate and the reasonableness of
Management assumes that the value of collaterals will be fully recoverability of collateral in the light of our industry
realised through sale in the event of default on loans and advances. knowledge and guidelines issued by Bank of Ghana.

The collective impairment loss allowance relates to losses incurred • For collective impairment, we assessed the appropriateness
but not yet identified (IBNR loss allowances) on other loans and and consistencies of the model used.
advances. The two key judgments in the collective provisioning
assessment are the likelihood of default and the emergence period. • Evaluating the adequacy of the Group’s disclosures in
The impairment assessment requires the application of significant relation to impairment about the changes in estimate
judgement by management including the application of industry occurring during the period and the sensitivity to the key
knowledge, prevailing economic conditions and historical data to assumptions.
determine the level of impairment allowance required.

Interest Income (GH¢905.3 million)

Refer to Note 6 of the consolidated and separate financial statements

Impairment Allowance on loans and advances Our procedures included:

Interest income is recognised using the effective interest rates as • Testing controls over the existence and accuracy of reported
opposed to the nominal rate. Determining the effective interest revenues.
rate involves some level of complexity which could lead to
inaccurate interest recognition. In addition, there is a presumed • Using computer assisted audit techniques to perform
risk that revenue may not be appropriately recognised. substantive testing to confirm completeness and accuracy
of revenue reported.

• Agreeing underlying data on loans and advances to details

of loans and advances in the Bank’s general ledger and
banking application.

• Assessing the adequacy of the Bank’s disclosures of its

revenue recognition policy and other related disclosures.

Ecobank Ghana Annual Report 2016 55

Annual Report

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF

ECOBANK GHANA LIMITED (CONT’D)

Other Information

The Directors are responsible for the other information. The other information comprises the information included in the Annual
Reports and the Directors’ Report as required by the Companies Act, 1963 (Act 179) and the Banking Act, 2004 (Act 673) as amended
by the Banking (Amendment) Act, 2007 (Act 738) but does not include the consolidated and separate financial statements and our
auditor’s report thereon.

Our opinion on the consolidated and separate financial statements does not cover the other information and we do not express any
form of assurance conclusion thereon.

In connection with our audit of the consolidated and separate financial statements, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the consolidated and separate financial
statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work we have
performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have
nothing to report in this regard.

Responsibilities of the Directors for the Consolidated and Separate Financial Statements

The Directors are responsible for the preparation of consolidated and separate financial statements that give a true and fair view
in accordance with International Financial Reporting Standards and in the manner required by the Companies Act, 1963 (Act 179)
and the Banking Act, 2004 (Act 673) as amended by the Banking (Amendment) Act, 2007 (Act 738), and for such internal control as
the Directors determine is necessary to enable the preparation of financial statements that are free from material misstatement,
whether due to fraud or error.

In preparing the consolidated and separate financial statements, the Directors are responsible for assessing the Group’s ability
to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless the Directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do
so.

The Directors are responsible for overseeing the Group’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Consolidated and Separate Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated and separate financial statements as a whole
are free from material misstatement, whether due to fraud or error and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will
always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis
of these consolidated financial statements.

As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional skepticism throughout the
audit. We also:

• Identify and assess the risks of material misstatement of the consolidated and separate financial statements, whether due
to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient
and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is
higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or
the override of internal control.

56 Ecobank Ghana Annual Report 2016

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
ECOBANK GHANA LIMITED (CONT’D)

Auditor’s Responsibilities for the Audit of the Consolidated and Separate Financial Statements (cont’d)

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in
the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related
disclosures made by management.

• Conclude on the appropriateness of the Directors’ use of the going concern basis of accounting and, based on the audit
evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the
Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw
attention in our auditor’s report to the related disclosures in the consolidated and separate financial statements or, if such
disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date
of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the consolidated and separate financial statements, including the
disclosures, and whether the consolidated and separate financial statements represent the underlying transactions and
events in a manner that achieves fair presentation.

• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within
the Group to express an opinion on the consolidated and separate financial statements. We are responsible for the
direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion

We communicate with the Directors regarding, among other matters, the planned scope and timing of the audit and significant audit
findings, including any significant deficiencies in internal control that we identify during our audit.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

Compliance with the requirements of Section 133 of the Companies Act, 1963 (Act 179) and Section 78 of the Banking Act, 2004 (Act
673) as amended by the Banking (Amendment) Act, 2007 (Act 738)

We have obtained all the information and explanations which, to the best of our knowledge and belief were necessary for the
purpose of our audit.

In our opinion, proper books of account have been kept, and the consolidated and separate statements of financial position and
profit or loss and other comprehensive income are in agreement with the books of account.

The Bank’s transactions were within its powers and the Bank generally complied with the relevant provisions of the Banking Act, 2004
Act 673 as amended by the Banking (Amendment) Act, 2007 (Act 738).

The engagement partner on the audit resulting in this independent auditor’s report is Anthony Kwasi Sarpong (ICAG/P/1369).

……………………………………………
FOR AND ON BEHALF OF:
KPMG: (ICAG/F/2017/038)
CHARTERED ACCOUNTANTS
13 YIYIWA DRIVE, ABELENKPE, P O BOX GP 242, ACCRA

23 FEBRUARY, 2017
Ecobank Ghana Annual Report 2016 57
Annual Report

ECOBANK GHANA LIMITED

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2016

The Group The Bank

Note 2016 2015

GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Interest income 6 905,304 843,564 878,914 790,961

Interest expense 7 (186,199) (161,323) (177,437) (125,529)

Net interest income 719,105 682,241 701,477 665,432

Fees and commission income 8 160,489 189,245 160,503 189,253

Fees and commission expense 9 (3,267) (3,883) (3,233) (3,883)

Net fees and commission income 157,222 185,362 157,270 185,370

Net trading income 10 130,274 138,857 129,934 138,351

Other operating income 11 18,062 13,182 17,691 13,174

Other revenue 12 4,140 3,487 16,942 23,438

Gains from derecognition of financial

assets measured at amortized cost 13 177,854 - 177,854 -

330,330 155,526 342,421 174,963

Revenue 1,206,657 1,023,129 1,201,168 1,025,765

Other income 14 291 184 291 184

Net Impairment loss on financial assets 15 (178,597) (115,795) (178,570) (115,753)

Personnel expenses 16 (316,359) (246,124) (315,993) (245,796)

Depreciation and amortisation 17 (21,534) (19,648) (21,533) (19,633)

Other expenses 18 (228,468) (184,034) (228,177) (183,688)

Operating profit 461,990 457,712 457,186 461,079

Share of profit of associates (net of tax) 41 686 848 - -

Profit before income tax 462,676 458,560 457,186 461,079

Income tax expense 19 (134,780) (137,294) (131,592) (133,556)

Profit for the period 327,896 321,266 325,594 327,523

The notes on pages 68 to 149 form an integral part of these financial statements.

58 Ecobank Ghana Annual Report 2016

ECOBANK GHANA LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2016

The Group The Bank

2016 2015 2016 2015
Note GH¢’000 GH¢’000 GH¢’000 GH¢’000

Profit for the year 327,896 321,266 325,594 327,523

Other comprehensive income

Items that may be reclassified
Subsequently to profit or loss

Change in value of available

for sale investment securities 37(b) - 2,285 - 1,712

Realised gains on securities disposed 37(b) 2,221 - 1,100 -

Income tax relating to components

of other comprehensive income 20 (9,482) (571) (9,202) (428)

Other comprehensive income for the year, net of tax (7,261) 1,714 (8,102) 1,284

Total comprehensive income for the year 320,635 322,980 317,492 328,807

Profit for the year attributable to:

Equity holders of the Bank 327,896 321,266 325,594 327,523

Comprehensive income for the year attributable to:

Equity holders of the Bank 320,635 322,980 317,492 328,807

Earnings per share

Basic and diluted (in Ghana pesewas) 22 112 110 111 112

The notes on pages 68 to 149 form an integral part of these financial statements.

Ecobank Ghana Annual Report 2016 59

Annual Report

ECOBANK GHANA LIMITED

CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2016

The Group The Bank

Note 2016 2015

GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Assets

Cash and bank balances 23 3,193,202 2,222,949 3,191,866 2,221,872

Loans and advances to customers 24 3,480,544 3,117,873 3,480,471 3,116,749

Investment securities 25 641,010 728,874 578,985 594,255

Investment in subsidiaries 26 - - 22,778 16,773

Investment in associates 41 8,073 7,387 4,841 4,841

Deferred tax asset 20 - 986 - 701

Current tax asset 19 6,003 16,809 5,593 16,524

Other assets 27 342,262 335,247 355,200 354,088

Intangible assets 28 5,389 8,852 5,389 8,852

Non-current asset held for sale 29 63,726 - 63,726 -

Property and equipment 30 316,661 252,833 316,661 252,832

Total assets 8,056,870 6,691,810 8,025,510 6,587,487

Liabilities

Deposits from Banks 31 542,856 205,123 630,288 286,934

Deposit from customers 32 5,416,916 4,837,950 5,316,625 4,664,513

Deferred tax liabilities 20 6,801 - 6,810 -

Borrowings 33 232,744 321,976 232,744 321,976

Other liabilities 34 893,477 437,008 886,835 433,036

Total liabilities 7,092,794 5,802,057 7,073,302 5,706,459

The notes on pages 68 to 149 form an integral part of these financial statements.

60 Ecobank Ghana Annual Report 2016

ECOBANK GHANA LIMITED
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER
2016 (CONT’D)

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
Note GH¢’000 GH¢’000

Equity and reserves

Stated capital 35 226,641 226,641 226,641 226,641

Income surplus 36 271,445 272,852 260,078 263,775

Revaluation reserve 37 50,129 57,390 50,129 58,231

Statutory reserve 39 323,124 282,412 322,623 281,923

Credit risk reserve 40 92,737 50,458 92,737 50,458

Total equity attributable to

equity holders of the Bank 964,076 889,753 952,208 881,028

Total liabilities and equity 8,056,870 6,691,810 8,025,510 6,587,487

These financial statements were approved by the Board of Directors on 23 February 2017 and signed on its behalf by:

Signed Signed
CHAIRMAN MANAGING DIRECTOR
Terence Ronald Darko Daniel Nii Kwei-Kumah Sackey,

The notes on pages 68 to 149 form an integral part of these financial statements.

Ecobank Ghana Annual Report 2016 61

Annual Report

ECOBANK GHANA LIMITED

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEAR ENDED 31
DECEMBER 2016

STATED INCOME REVALUATION STATUTORY CREDIT RISK TOTAL

THE GROUP CAPITAL SURPLUS RESERVE RESERVE RESERVE

GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Balance at 1 January 2015 226,641 264,393 55,676 241,443 10,270 798,423

Total comprehensive income

Profit for the year - 321,266 - - - 321,266

Other comprehensive income, net of tax - - 1,714 - - 1,714

Total comprehensive income for the year - 321,266 1,714 - - 322,980

Transactions with equity holders

Dividends paid - (231,650) - - - (231,650)

Total contribution by and distribution to

equity holders - (231,650) - - - (231,650)

Regulatory transfers

Statutory reserve - (40,969) - 40,969 - -

Credit risk reserve - (40,188) - - 40,188 -

- (81,157) - 40,969 40,188 -

Balance at 31 December 2015 226,641 272,852 57,390 282,412 50,458 889,753

The notes on pages 68 to 149 form an integral part of these financial statements.

62 Ecobank Ghana Annual Report 2016

ECOBANK GHANA LIMITED
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEAR ENDED 31
DECEMBER 2016 (CONT’D)

STATED INCOME REVALUATION STATUTORY CREDIT RISK TOTAL

THE GROUP (CONT’D) CAPITAL SURPLUS RESERVE RESERVE RESERVE

GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Balance at 1 January 2016 226,641 272,852 57,390 282,412 50,458 889,753

Total comprehensive income

Profit for the year - 327,896 - - - 327,896

Other comprehensive income, net of tax - - (7,261) - - (7,261)

Total comprehensive income for the year - 327,896 (7,261) - - 320,635

Transactions with equity holders

Dividends paid - (246,312) - - - (246,312)

Total contribution by and distribution to

equity holders - (246,312) - - - (246,312)

Regulatory transfers

Statutory reserve - (40,712) - 40,712 - -

Credit risk reserve - (42,279) - - 42,279 -

- (82,991) - 40,712 42,279 -

Balance at 31 December 2016 226,641 271,445 50,129 323,124 92,737 964,076

The notes on pages 68 to 149 form an integral part of these financial statements.

Ecobank Ghana Annual Report 2016 63

Annual Report

ECOBANK GHANA LIMITED

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEAR ENDED 31
DECEMBER 2016 (CONT’D)

STATED INCOME REVALUATION STATUTORY CREDIT RISK TOTAL

THE BANK CAPITAL SURPLUS RESERVE RESERVE RESERVE

GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Balance at 1 January 2015 226,641 249,030 56,947 240,983 10,270 783,871

Total comprehensive income for the year

Profit for the year - 327,523 - - - 327,523

Other comprehensive income, net of tax - - 1,284 - - 1,284

Total comprehensive income for the year - 327,523 1,284 - - 328,807

Transactions with equity holders

Dividends paid - (231,650) - - - (231,650)

Total contribution by and distribution to

equity holders - (231,650) - - - (231,650)

Regulatory transfers

Statutory reserve - (40,940) - 40,940 - -

Credit risk reserve - (40,188) - - 40,188 -

- (81,128) - 40,940 40,188 -

Balance at 31 December 2015 226,641 263,775 58,231 281,923 50,458 881,028

The notes on pages 68 to 149 form an integral part of these financial statements.

64 Ecobank Ghana Annual Report 2016

ECOBANK GHANA LIMITED
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER
2016 (CONT’D)

STATED INCOME REVALUATION STATUTORY CREDIT RISK TOTAL

THE BANK (CONT’D) CAPITAL SURPLUS RESERVE RESERVE RESERVE

GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Balance at 1 January 2016 226,641 263,775 58,231 281,923 50,458 881,028

Total comprehensive income for the year

Profit for the year - 325,594 - - - 325,594

Other comprehensive income, net of tax - - (8,102) - - (8,102)

Total comprehensive income for the year - 325,594 (8,102) - - 317,492

Transactions with equity holders

Dividends paid - (246,312) - - - (246,312)

Total contribution by and distribution to

equity holders - (246,312) - - - (246,312)

Regulatory transfers

Statutory reserve - (40,700) - 40,700 - -

Credit risk reserve - (42,279) - - 42,279 -

- (82,979) - 40,700 42,279 -

Balance at 31 December 2016 226,641 260,078 50,129 322,623 92,737 952,208

The notes on pages 68 to 149 form an integral part of these financial statements.

Ecobank Ghana Annual Report 2016 65

Annual Report

ECOBANK GHANA LIMITED

CONSOLIDATED STATEMENTS OF CASHFLOWS FOR THE YEAR ENDED 31
DECEMBER 2016

The Group The Bank

Note 2016 2015

GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Cash flows from operating activities

Interest paid (206,986) (160,395) (184,667) (124,601)

Interest received 927,253 843,564 894,554 790,961

Net fees and commissions 157,222 185,362 157,270 185,370

Other income received 22,202 16,669 34,633 36,612

Net trading income 194,123 173,636 193,783 173,130

Payments to employees and suppliers (320,565) (470,854) (319,574) (470,193)

Tax paid (125,669) (153,079) (122,352) (148,923)

Cash flows from operating activities before changes

in operating assets and liabilities 647,580 434,903 653,647 442,356

Changes in operating assets and liabilities

Loans and advances (493,709) (297,700) (488,424) (298,958)

Other assets (4,907) (232,631) (5,009) (252,243)

Customer deposits 349,372 234,910 422,518 267,783

Other liabilities 389,953 99,446 373,392 98,311

Mandatory reserves (156,092) (122,709) (156,092) (122,709)

Net cash generated from operating activities 732,197 116,219 800,032 134,540

Cash flow from investing activities

Purchase of property and equipment 30 (83,094) (134,026) (83,094) (134,026)

Purchase of software 28 (956) (7,677) (956) (7,677)

Proceeds from sale of equipment 30 2,442 184 2,442 184

The notes on pages 68 to 149 form an integral part of these financial statements.

66 Ecobank Ghana Annual Report 2016

ECOBANK GHANA LIMITED
CONSOLIDATED STATEMENTS OF CASHFLOWS FOR THE YEAR ENDED 31
DECEMBER 2016 (CONT’D)

Note The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Cash flow from investing activities (cont’d)

Government securities purchased (3,750,837) (1,567,240) (3,515,475) (1,340,338)

Proceeds from sale of Government securities 3,534,928 1,799,344 3,279,529 1,567,873

Purchase of AFS investment - (626) - (626)

Net cash from investing activities (297,517) 89,959 (317,554) 85,390

Cash flow from financing activities

Dividend paid (246,312) (231,650) (246,312) (231,650)

Repayment of borrowed funds 33 (180,646) (95,326) (180,646) (95,326)

Proceeds from borrowed funds 33 43,796 150,990 43,796 150,990

Net cash used in financing activities (383,162) (175,986) (383,162) (175,986)

Net increase in cash and cash equivalents 51,518 30,192 99,316 43,944

Cash and cash equivalents at beginning of year 2,078,094 1,857,687 1,886,005 1,651,846

Effect of exchange rate fluctuations on cash and

cash equivalents 118,916 190,215 118,916 190,215

Cash and cash equivalents at end of year 38 2,248,528 2,078,094 2,104,237 1,886,005

The notes on pages 68 to 149 form an integral part of these financial statements.

Ecobank Ghana Annual Report 2016 67

Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016

1. GENERAL INFORMATION

Ecobank Ghana Limited is a limited liability company, incorporated and domiciled in Ghana. These financial statements comprise the
consolidated financial statements of the Bank and its subsidiaries (together the Group) and its interest in associates as well as the
separate financial statement of the Bank. The Group provides retail, corporate and investment banking and other financial services
in Ghana.

The Bank is listed on the Ghana Stock Exchange.

The consolidated and separate financial statements were authorized for issue by the Board of Directors on 23 February 2017.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accounting policies set out below have been applied consistently to all the periods presented in these financial statements and
have been applied consistently by Group entities.

2.1 Basis of Presentation

The Group’s financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued
by the International Accounting Standards Board. Additional information required by the Companies Act, 1963 (Act 179) and the
Banking Act, 2004 (Act 673) as amended by the Banking Amendment Act, 2007 (Act 738) have been included, where appropriate. The
financial statements have been prepared under the historical cost convention, except for buildings which are carried at revalued
amounts and available for sale financial assets carried at fair values.

The financial statements comprise the statements of financial position, comprehensive income, changes in equity and cash flows
and notes to the financial statements. The financial statements are presented in Ghana cedis, which is the Group’s functional and
presentation currency. Except otherwise indicated, financial information presented in Ghana cedis has been rounded to the nearest
thousand.

Information on risks from financial instruments and financial risk management policies are disclosed in Note 3.

2.2 Use of Judgment and Estimates

The preparation of financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions
that affect the application of accounting policies and reported amounts of assets, liabilities, income and expenses. Actual results
may differ from these estimates. Estimates and underlying assumptions are reviewed on an on-going basis. Revisions to accounting
estimates are recognised in the period in which the estimate is revised, if the revision affects only that period or in the period of
revision and future periods, if the revision affects both current and future periods.

Areas involving a higher degree of judgement or complexity, or where assumptions and estimates are considered significant to the
financial statements, are disclosed in Note 5.

68 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

2.3 NEW STANDARDS AND INTERPRETATIONS NOT YET ADOPTED

There are new or revised Accounting Standards and Interpretations in issue that are not yet effective. These include the following
Standards and Interpretations that may have an impact on future financial statements: The Bank does not plan to adopt these
standards early

STANDARD/INTERPRETATION EFFECTIVE DATE

IFRS 9 Financial instruments 1 January 2018
IFRS 15 Revenue from contract with customers 1 January 2018
IFRS 16 Leases 1 January 2019

IFRS 9 (2014) Financial Instruments

IFRS 9 has been completed in stages with the IASB’s phased approach reflected in a number of the standard being issued since 2009.
Previous versions of the standard will be superseded by the version issued in July 2014 at its effective date of 1 January 2018.

The complete version of IFRS 9 replaces most of the guidance in IAS 39. IFRS 9 retains but simplifies the mixed measurement model
and establishes three primary measurement categories for financial assets: amortised cost, fair value through Other Comprehensive
Income and fair value through P&L. The existing IAS 39 categories of held-to-maturity, loans and receivables, and available for sale,
are removed.

The basis of classification depends on the entity’s business model and the contractual cash flow characteristics of the financial asset.
A financial asset is classified as being subsequently measured at amortised cost if the asset is held within a business model whose
objective is to collect contractual cash flows, and the contractual terms of the financial asset give rise to cash flows that are solely
payments of principal and interest.

A financial asset is classified as being subsequently measured at fair value through other comprehensive income if it meets the solely
payments of principal and interest criterion and is held in a business model whose objective is achieved by both collecting contractual
cash flows and selling financial assets.

All other financial assets are subsequently measured at fair value through Profit and Loss. In addition an entity may, at initial
recognition, irrevocably designate a financial asset as at fair value through profit and loss if doing so eliminates or significantly
reduces an accounting mismatch that would otherwise arise.

Investments in equity instruments are required to be measured at fair value through profit or loss with the irrevocable option at
inception to present changes in fair value in Other Comprehensive Income.

For financial liabilities there were no changes to classification and measurement except for the recognition of changes in own credit
risk in other comprehensive income, for liabilities designated at fair value, through profit or loss. IFRS 9 relaxes the requirements for
hedge effectiveness by replacing the bright line hedge effectiveness tests. It requires an economic relationship between the hedged
item and hedging instrument and for the ‘hedged ratio’ to be the same as the one management actually uses for risk management
purposes.

Reclassification of financial assets is required if the objective of the business model in which they are held changes after initial
recognition of the assets, and if the change is significant to the entity’s operations. Such changes are expected to be very infrequent.
No other reclassifications are permitted.

Ecobank Ghana Annual Report 2016 69

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

2.3 NEW STANDARDS AND INTERPRETATIONS NOT YET ADOPTED (CONT’D)

There is now a new expected credit losses model that replaces the incurred loss impairment model used in IAS 39. The new model
uses a dual measurement approach under which the loss allowance is measured as either 12-month expected credit losses or life-
time expected losses.

The Bank would be impacted due to the extensive new requirements for data and calculations and there may be the need for new
processes to allocate financial assets to the appropriate measurement category.

IFRS 15 Revenue from contracts with customers

The standard contains a single model that applies to contracts with customers and two approaches to recognising revenue: at a point
in time or over time. The model features a contract-based five-step analysis of transactions to determine whether, how much and
when revenue is recognised.

This new standard which is effective for annual periods beginning on or after 1 January 2018 may have an impact on the Group,
which will include a possible change in the timing of when revenue is recognised and the amount of revenue recognised. The Group
is currently in the process of performing a more detailed assessment of the impact of this standard on the Group and will provide
more information in the year ending 31 December 2017 financial statements.

IFRS 16 Leases

IFRS 16 was published in January 2016. It sets out the principles for the recognition, measurement, presentation and disclosure of
leases for both parties to a contract, i.e. the customer (‘lessee’) and the supplier (‘lessor’). IFRS 16 replaces the previous leases Stand-
ard, IAS 17 Leases, and related Interpretations. IFRS 16 has one model for lessees which will result in almost all leases being included
on the Statement of Financial position. No significant changes have been included for lessors.

The standard is effective for annual periods beginning on or after 1 January 2019, with early adoption permitted only if the entity also
adopts IFRS 15. The transitional requirements are different for lessees and lessors. The group and company have begun assessing
the potential impact on the financial statements resulting from the application of IFRS 16. No significant impact is expected for the
group and Bank’s finance leases.

2.4 CONSOLIDATION
The financial statements of subsidiaries used to prepare the consolidated financial statements were prepared as of the parent com-
pany’s reporting date. The accounting policies of subsidiaries that are consolidated by the group conform to these policies.

(a) Business combinations

Business combinations are accounted for using the acquisition method as at the acquisition date - i.e. when control is transferred
to the Group. The consideration transferred in the acquisition is generally measured at fair value, as are the identifiable net assets
acquired.

Any goodwill that arises is tested annually for impairment. Any gain on a bargain purchase is recognised in profit or loss immediately.
Transaction costs are expensed as incurred, except if they are related to the issue of debt or equity securities.

The consideration transferred does not include amounts related to the settlement of pre-existing relationships. Such amounts are
generally recognised in profit or loss.

70 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

(a) Business combinations (cont’d)

Any contingent consideration payable is measured at fair value at the acquisition date. If the contingent consideration is classified
as equity, then it is not remeasured and settlement is accounted for within equity. Otherwise, subsequent changes in the fair value
of the contingent consideration are recognised in profit or loss.

(b) Non-controlling interest

Non-controlling interests (NCI) are measured at their proportionate share of the acquiree’s identifiable net assets at the acquisition
date.

(c) Subsidiaries

Subsidiaries are investees controlled by the Group. The Group ‘controls’ an investee if it is exposed to, or has rights to, variable
returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. The
financial statements of subsidiaries are included in the consolidated financial statements from the date on which control commences
until the date when control ceases. Investment in subsidiaries are accounted for at cost less accumulated impairment losses (where
applicable) in the separate financial statements. The carrying amount of these investments are reviewed annually for impairment
indicators and where an indicator of impairment exists, are impaired to the higher of the investment fair value less cost to sell and
value in use.

Intra-group balances and transactions, and any unrealised income and expenses (except for foreign currency transaction gains or
losses) arising from intra-group transactions, are eliminated in preparing the consolidated financial statements. Unrealised losses
are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.

(d) Loss of control

When the Group loses control over a subsidiary, it derecognizes the assets and liabilities of the subsidiary and any related non-con-
trolling interest and other components of equity. Any resulting gain or loss is recognized in profit or loss. Any retained interest in the
entity is measured at fair value with the change in carrying amount recognized in profit or loss. Any amounts previously recognised
in other comprehensive income in respect of that entity are accounted for as if the group had directly disposed of the related assets
or liabilities. This may mean that amounts previously recognised in other comprehensive income are reclassified to profit or loss.

(e) Transactions eliminated on consolidation

Changes in the Group’s interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions.

(f) Associates

Associates are all entities over which the Group has significant influence but not control. Investments in associates are accounted
for using the equity method of accounting. Under the equity method, the investment is initially recognised at cost, and the carrying
amount is increased or decreased to recognise the investor’s share of the profit or loss of the investee after the date of acquisition.
If the ownership interest in an associate is reduced but significant influence is retained, only a proportionate share of the amounts
previously recognised in other comprehensive income is reclassified to profit or loss where appropriate.

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

(f) Associates (cont’d)

Profits and losses resulting from transactions between the Group and its associate are recognised in the group’s financial statements
only to the extent of unrelated investor’s interests in the associates. Unrealised losses are eliminated unless the transaction provides
evidence of an impairment of the asset transferred.

2.5 SEGMENT REPORTING

Operating segments are reported in a manner consistent with internal reporting to the Board of Directors, which has responsibility
for allocating resources and measuring performance of operating segments.

All transactions between business segments are conducted on an arm’s length basis, with intra-segment revenue and costs being
eliminated on consolidation. Income and expenses directly associated with each segment are included in determining business
segment performance in accordance with IFRS 8. The Group has the following business segments: Consumer, Commercial and
Corporate which are reportable segments. These divisions offer different products and services and are managed separately based
on the Group’s management and internal reporting structure.

The business segments are defined as per below:

The credit quality of the portfolio of loans and advances to customers that were neither past due nor impaired can be assessed by
reference to the internal rating system adopted by the Group based on the various business segments.

(a) Consumer banking - This is personal banking and specializes in serving the Premier, Advantage, Classic and Direct customers

(b) Commercial Banking - This is Business Banking and Medium Local Corporates with the following sub-segments SMEs, Medium
Local corporates and Non-government public sector (schools, faith, NGOs & professional bodies)

(b) Corporate banking - Specializes in serving the public sector, multinational institutions, financial institutions/international
organizations and the Regional Corporate segment of the market.

2.6 FOREIGN CURRENCY TRANSLATION

Transactions and balances

Foreign currency transactions are translated into the functional currency using exchange rates prevailing at the dates of the
transactions.

Monetary assets and liabilities denominated in foreign currency are re-translated at closing rates ruling at the reporting date. Non-
monetary items measured at historical cost denominated in a foreign currency are translated at exchange rates ruling at the dates
of initial recognition; and non-monetary items in a foreign currency that are measured at fair value are translated at exchange rates
ruling at the date at which the fair value is determined.

Foreign exchange gains and losses resulting from the settlement of foreign currency transactions and from re-translation, at year-
end exchange rates of foreign currency denominated monetary assets and liabilities, are recognised in profit or loss.

72 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

Transactions and balances (cont’d)

All foreign exchange gains and losses recognised in profit or loss are presented net within the corresponding item. Foreign exchange
gains and losses on other comprehensive income items are presented in other comprehensive income within the corresponding
item.

Translation differences on non-monetary financial instruments, such as equities classified as available-for-sale financial assets, are
included in other comprehensive income.

2.7 FINANCIAL ASSETS AND LIABILITIES

All financial assets and liabilities have to be recognised in the statement of financial position and measured in accordance with their
assigned category.

2.7.1 Financial assets

The Group classifies its financial assets in the following categories: loans and receivables and available-for-sale financial assets.
Management determines the classification of its financial assets at initial recognition.

(a) Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active
market, other than:

(i) those that the Group intends to sell immediately or in the short term, which are classified as held for trading, and those that
the Group upon initial recognition designates at fair value through profit or loss;

(ii) those that the Group upon initial recognition designates as available for sale; or

(iii) those for which the holder may not recover substantially all of the initial investment, other than because of credit deterioration.

Loans and advances include cash and balances with Bank of Ghana, government securities, loans and advances to banks, loans and
advances to customers and some other assets.

Loans and advances are initially measured at fair value plus incremental direct transaction costs, and subsequently measured at their
amortised cost using the effective interest method. Loans and receivables are reported in the statement of financial position as loans
and advances to groups or customers or as investment securities. Interest on loans is included in profit or loss and is reported as
‘Interest income’. In the case of an impairment, the impairment loss is reported as a deduction from the carrying value of the loan
and recognised in profit and loss as ‘loan impairment charges’

(b) Available-for-sale financial assets

Available-for-sale financial assets are financial assets that are intended to be held for an indefinite period of time, which may be sold
in response to needs for liquidity or changes in interest rates, exchange rates or equity prices that are not classified as loans and
receivables, held-to-maturity investments or financial assets at fair value through profit or loss. Available-for-sale financial assets
include investment securities available for sale.

Ecobank Ghana Annual Report 2016 73

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

2.7.1 Financial assets (assets)

Available-for-sale financial assets are initially recognised at fair value, which is the cash consideration including any transaction
costs, and measured subsequently at fair value with gains and losses being recognised in other comprehensive income, except for
impairment losses and foreign exchange gains and losses, until the financial asset is derecognised.

Unquoted equity securities whose fair value cannot be measured reliably are carried at cost. If an available-for-sale financial asset
is determined to be impaired, the cumulative gain or loss previously recognised in other comprehensive income is recognised
in profit and loss. However, interest is calculated using the effective interest method, and foreign currency gains and losses on
monetary assets classified as available for sale are recognised in profit and loss. Dividends on available-for-sale equity instruments
are recognised in profit and loss in ‘Dividend income’ when the Group’s right to receive payment is established.

(c) Recognition

The Group uses trade date accounting for regular contracts when recording financial asset transactions. Financial assets that are
transferred to a third party but do not qualify for derecognition are presented in the statement of financial position as ‘Assets
pledged as collateral’, if the transferee has the right to sell or re-pledge them.

2.7.2 Financial liabilities

Financial liabilities include deposits from related entities, banks and customers or debt securities in issue, convertible bonds and
subordinated and other debts for which the fair value option is not applied. Financial liabilities are measured initially at fair value
plus, for an item not at fair value through profit or loss, transaction costs that are directly attributable to its acquisition or issue and
subsequently measured at their amortised cost.

2.7.3 Determination of fair value

‘Fair value’ is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date in the principal or, in its absence, the most advantageous market to which the Group has
access at that date. The fair value of a liability reflects its non-performance risk.

When available, the Group measures the fair value of an instrument using the quoted price in an active market for that instrument. A
market is regarded as active if transactions for the asset or liability take place with sufficient frequency and volume to provide pricing
information on an ongoing basis.

If there is no quoted price in an active market, then the Group uses valuation techniques that maximise the use of relevant observable
inputs and minimise the use of unobservable inputs. The chosen valuation technique incorporates all of the factors that market
participants would take into account in pricing a transaction.

The best evidence of the fair value of a financial instrument at initial recognition is normally the transaction price - i.e. the fair value
of the consideration given or received. If the Group determines that the fair value at initial recognition differs from the transaction
price and the fair value is evidenced neither by a quoted price in an active market for an identical asset or liability nor based on a
valuation technique that uses only data from observable markets, then the financial instrument is initially measured at fair value,
adjusted to defer the difference between the fair value at initial recognition and the transaction price. Subsequently, that difference
is recognised in profit or loss on an appropriate basis over the life of the instrument but no later than when the valuation is wholly
supported by observable market data or the transaction is closed out.

74 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

2.7.3 Determination of fair value (cont’d)

If an asset or a liability measured at fair value has a bid price and an ask price, then the Group measures assets and long positions at
a bid price and liabilities and short positions at an ask price.

Portfolios of financial assets and financial liabilities that are exposed to market risk and credit risk that are managed by the Group on
the basis of the net exposure to either market or credit risk are measured on the basis of a price that would be received to sell a net
long position (or paid to transfer a net short position) for a particular risk exposure. Those portfolio-level adjustments are allocated
to the individual assets and liabilities on the basis of the relative risk adjustment of each of the individual instruments in the portfolio.

The fair value of a demand deposit is not less than the amount payable on demand, discounted from the first date on which the
amount could be required to be paid.

The Group recognises transfers between levels of the fair value hierarchy as of the end of the reporting period during which the
change has occurred.

2.7.4 Derecognition

Financial assets are derecognised when the contractual rights to receive cash flows from the financial asset has expired or the Group
has transferred substantially all the risks and rewards of ownership. On derecognition of a financial asset, the difference between
the carrying amount of the asset (or the carrying amount allocated to the portion of the asset derecognised) and the sum of (i) the
consideration received (including any new asset obtained less any new liability assumed) and (ii) any cumulative gain or loss that had
been recognised in OCI is recognised in profit or loss.

Any interest in the transferred financial asset that is created or retrieved by the Bank is recognised as a separate asset or liability.
Financial liabilities are derecognised when contractual obligations are discharged, cancelled or expire.

Collateral (shares and bonds) furnished by the Group under standard repurchase agreements and securities lending and borrowing
transactions are not derecognised because the Group retains substantially all the risks and rewards on the basis of predetermined
repurchase prices, and the criteria for derecognition are therefore not met. This also applies to certain securitisation transactions in
which the Group retains a portion of the risks.

2.7.5 Reclassification of financial assets

The Group may choose to reclassify a non-derivative financial asset held for trading out of the held-for-trading category, if the
financial asset is no longer held for the purpose of selling in the near-term.

Financial assets other than loans and receivables are permitted to be reclassified out of the held for trading category only in rare
circumstances arising from a single event that is unusual and highly unlikely to recur in the near-term. In addition, the Group may
choose to reclassify financial assets that would meet the definition of loans and receivables out of the held-for-trading or available-
for-sale categories, if the Group has the intention and ability to hold these financial assets for the foreseeable future or until maturity
at the date of reclassification.

Reclassifications are made at fair value as of the reclassification date. Fair value becomes the new cost or amortised cost as applicable,
and no reversals of fair value gains or losses recorded before reclassification date are subsequently made. Effective interest rates
for financial assets reclassified to loans and receivables and held-to-maturity categories are determined at the reclassification date.
Further increases in estimates of cash flows adjust effective interest rates prospectively.

Ecobank Ghana Annual Report 2016 75

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

2.7.6 Classes of financial instruments

The Group classifies financial instruments into classes that reflect the nature and characteristics of those financial instruments. The
classifications made are set out in the table below:

CATEGORY CLASS
SUBCLASSES
(AS DEFINED BY IAS 39) (AS DETERMINED BY THE GROUP)
Debt securities
Financial assets held for
Equity securities
trading
Derivatives – non-hedging
Financial assets at fair Debt securities
value through profit or Equity securities
Financial assets
loss
Loans and advances to
designated at fair value
Banks
through profit or loss
Loans and advances to
customers
Loans and advances to Banks
Overdrafts
Loans to individuals Credit cards
Loans and advances to (retail) Term loans
Loans and receivables customers Mortgages
Financial assets
Loans to corporate Term loans overdrafts
entities Others
Listed
Investment securities - debt instruments
Unlisted
Held-to-maturity Listed
Investment securities - debt securities
Investments Unlisted
Investment securities - debt securities Listed
Listed
Investment securities - equity securities
Unlisted
Available-for-sale Debt securities in issue
financial assets Convertible bonds These are additional
classes of financial
Subordinated debt liabilities at amortised
cost

76 Ecobank Ghana Annual Report 2016

 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

2.7.6 Classes of financial instruments (Cont’d)

CATEGORY
(AS DEFINED BY IAS 39) CLASS (AS DETERMINED BY THE GROUP) SUBCLASSES
Financial liabilities held for trading
(derivatives - non hedging only)
Financial lia-
bilities at fair
value through Designated at fair value through profit or loss - Debt
profit or loss securities in Issue

Financial Deposits from Banks

liabilities
Financial Deposits from Domestic customers
liabilities at customers Large corporate customers
armortised
cost Debt securities in issue
Convertible bonds
These are additional classes of financial
Subordinated debt liabilities at amortised cost
Off-balance sheet Loan commitments
financial
Instruments Guarantees, acceptances and other financial facilities

2.7.7 Offsetting financial instruments

Financial assets and liabilities are offset and the net amount reported when there is a legally enforceable right to offset the recognised
amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously.

2.7.8 Impairment of financial assets

(a) Assets carried at amortised cost

The Group assesses whether there is objective evidence that a financial asset or group of financial assets is impaired at each reporting
date. A financial asset or a group of financial assets is considered impaired only if there is objective evidence of impairment as a
result of one or more events that occurred after initial recognition of the asset (a ‘loss event’) and that loss event (or events) has an
impact on estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated.

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

(a) Assets carried at amortised cost (cont’d)

The criteria that the Group uses to determine whether there is objective evidence of an impairment loss include:

(a) significant financial difficulty of the issuer or obligor;

(b) a breach of contract, such as a default or delinquency in interest or principal payments;
(c) granting the borrower, the economic or legal reasons relating to the borrower’s financial difficulty, a concession that the lender
would not otherwise consider;
(d) a likely probability that the borrower will enter bankruptcy or other financial reorganisation;
(e) the disappearance of an active market for that financial asset because of financial difficulties; or
(f) observable data indicating that there is a measurable decrease in estimated future cash flows from a portfolio of financial
assets, since initial recognition of those assets, although the decrease cannot yet be identified with the individual financial
assets in the portfolio, including:

(i) adverse changes in the payment status of borrowers in the portfolio; and
(ii) national or local economic conditions that correlate with defaults on assets in the portfolio.

The estimate period between a loss occurring and its identification is determined by local management for each identified portfolio.
In general, the periods used vary between 3 and 12 months, in exceptional cases, longer periods are warranted.

The Group first assesses whether objective evidence of impairment exists individually for financial assets that are individually
significant, and individually or collectively for financial assets that are not individually significant. If the Group determines that no
objective evidence of impairment exists for an individually assessed financial asset, whether significant or not, it includes the asset
in a group of financial assets with similar credit risk characteristics and collectively assesses them for impairment. Assets that
are individually assessed for impairment and for which an impairment loss is or continues to be recognised are not included in a
collective assessment of impairment.

The amount of loss is measured as the difference between the asset’s carrying amount and the present value of estimated future
cash discounted at the financial asset’s original effective interest rate. The carrying amount of the asset is reduced through the use
of an allowance account and the amount of the loss is recognised in profit or loss. If a loan or held-to-maturity investment has a
variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the
contract. As a practical expedient, the Group may measure impairment on the basis of an instrument’s fair value using observable
market prices.

The calculation of the present value of estimated future cash flows of a collateralised financial asset reflects cash flows that may
result from foreclosure less costs for obtaining and selling the collateral, whether or not foreclosure is probable.

For the purposes of a collective evaluation of impairment, financial assets are grouped on the basis of similar credit risk characteristics
(that is, on the basis of the Group’s grading process that considers asset type, industry, geographical location, collateral type, past-due
status and other relevant factors). Those characteristics are relevant to the estimation of future cash flows for groups of such assets
by being indicative of the debtors’ ability to pay all amounts due according to the contractual terms of the assets being evaluated.

Future cash flows in groups of financial assets that are collectively evaluated for impairment are estimated on the basis of the
contractual cash flows of the assets in the group and historical loss experience for assets with credit risk characteristics similar to
those in the group. Historical loss experience is adjusted on the basis of current observable data to reflect the effects of current
conditions that did not affect the period on which the historical loss experience is based and to remove the effects of conditions in
the historical period that do not currently exist.

78 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

(a) Assets carried at amortised cost (cont’d)

Estimates of changes in future cash flows for groups of assets should reflect and be directionally consistent with changes in related
observable data from period to period including property prices, payment status and other factors indicative of changes in the probability
of losses and their magnitude. The methodology and assumptions used for estimating future cash flows are reviewed regularly by the
Group to reduce any differences between loss estimates and actual loss experience.

When a loan is uncollectible, it is written off against the related allowance for loan impairment. Such loans are written off after all the
necessary procedures have been completed and the amount of loss has been determined. Impairment charges relating to loans and
advances are recognised in loan impairment charges whilst impairment charges relating to investment securities (held to maturity and
loans and receivables categories) are recognised in ‘Net gains/(losses) on investment securities’.

If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring
after the impairment was recognised (such as an improvement in the debtor’s credit rating), the previously recognised impairment loss is
reversed by adjusting the allowance account. The amount of the reversal is recognised in profit or loss.

(b) Assets classified as available-for-sale

The Group assesses whether there is objective evidence that a financial asset or a group of financial assets is impaired at each reporting
date. In the case of equity investments classified as available for sale, a significant or prolonged decline in the fair value of the security
below its cost is objective evidence of impairment resulting in the recognition of an impairment loss. If any such evidence exists for
available-for-sale financial assets, the cumulative loss – measured as the difference between the acquisition cost and the current fair value,
less any impairment loss on that financial asset previously recognised in profit or loss – is removed from equity and recognised in profit
or loss. Impairment losses recognised in profit or loss on equity instruments are not reversed through profit or loss. If, in a subsequent
period, the fair value of a debt instrument classified as available for sale increases and the increase can objectively be related to an event
occurring after the impairment loss was recognised in profit or loss, the impairment loss is reversed through other comprehensive income.

(c) Renegotiated loans

Loans that are either subject to collective impairment assessment or individually significant and whose terms have been renegotiated are
no longer considered to be past due but are treated as performing loans, when performance has been confirmed. In subsequent years,
the asset is considered to be past due and disclosed as such only if renegotiated again.

If the terms of a financial asset are renegotiated or modified or an existing financial asset is replaced with a new one due to financial
difficulties of the borrower, then an assessment is made of whether the financial asset should be derecognised. If the cash flows of the
renegotiated asset are substantially different, then the contractual rights to cash flows from the original financial asset are deemed to have
expired. In this case, the original financial asset is derecognised and the new financial asset is recognised at fair value. The impairment
loss before an expected restructuring is measured as follows.

If the expected restructuring will not result in derecognition of the existing asset, then the estimated cash flows arising from the modified
financial asset are included in the measurement of the existing asset based on their expected timing and amounts discounted at the
original effective interest rate of the existing financial asset.

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

(c) Renegotiated loans (cont’d)

If the expected restructuring will result in derecognition of the existing asset, then the expected fair value of the new asset is treated
as the final cash flow from the existing financial asset at the time of its derecognition. This amount is discounted from the expected
date of derecognition to the reporting date using the original effective interest rate of the existing financial asset.

2.8 INTEREST INCOME AND EXPENSES

Interest income and expense for all interest-bearing financial instruments are recognised within ‘interest income’ and ‘interest
expense’ in profit or loss using the effective interest method.

The effective interest method is a method of calculating the amortised cost of a financial asset or a financial liability and allocating
interest income or interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated
future cash payments or receipts through the expected life of the financial instrument or, when appropriate, a shorter period to the
net carrying amount of the financial asset or financial liability.

When calculating the effective interest rate, the Group estimates cash flows considering all contractual terms of the financial
instrument, including prepayment options, but does not consider future credit losses. The calculation includes all fees and points
paid or received between parties to the contract that are an integral part of the effective interest rate, transaction costs and all other
premiums or discounts.

2.9 FEES AND COMMISSIONS INCOME

Fees and commissions are generally recognised on an accrual basis when the service has been provided. Loan commitment fees
for loans that are likely to be drawn down are deferred, together with related direct costs, and recognised as an adjustment to the
effective interest rate on the loan. Loan syndication fees are recognised as revenue when the syndication has been completed
and the Group has retained no part of the loan package for itself or retained a part at the same effective interest rate as the other
participants.

2.10 DIVIDEND INCOME

Dividends are recognised when the entity’s right to receive payment is established.

2.11 NET TRADING INCOME

Net trading income comprises gains less losses relating to trading assets and liabilities, including realised and unrealised fair value
changes, interest and foreign exchange differences.

2.12 CASH AND BANK BALANCES

Cash and bank balances include notes and coins on hand, unrestricted balances held with the Central Bank & other banks and highly
liquid financial assets with original maturities of three (3) months or less from the acquisition date that are subject to an insignificant
risk of changes in their fair value and are used by the Group in the management of its short-term commitments.

Cash and bank balances are carried at amortised cost.

80 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

2.13 LEASES

(i) Lease assets – Lessee

Leases that the Group assumes substantially all the risks and rewards of ownership of the underlying asset are classified as finance lease.
Upon initial recognition, the leased asset is measured at an amount equal to the lower of its fair value and present value of minimum lease
payments. Subsequent to initial recognition, the leased asset is accounted for in accordance with the accounting policy applicable to that
asset. All other leases are classified as operating leases.

(ii) Lease payments-Lessee

Payments made under operating leases are charged to profit or loss on a straight-line basis over the period of the lease. When an
operating lease is terminated before the lease has expired, any payment required to be made by the lessor by way of penalty is recognised
as an expense in the period in which termination takes place.

Minimum lease payments under finance leases are apportioned between finance expense and the outstanding lease liability. The finance
expense is allocated to each period so as to produce a constant periodic rate of interest on the remaining balance of the liability.

(iii) Lease assets – Lessor

If the Group is the lessor in a lease agreement that transfers substantially all of the risks and rewards incidental to ownership of the asset
to the lessee, then the arrangement is classified as a finance lease and a receivable equal to the net investment in the lease is recognised
and presented within loans and advances

2.14 PROPERTY AND EQUIPMENT

Except for buildings which are stated at revalued amounts, all other property and equipment are stated at cost less depreciation. Cost
includes expenditure that is directly attributable to the acquisition of the items.

Buildings are shown at valuation less subsequent depreciation. The fair values are determined every three (3) years by external, independent,
professional valuers. Any accumulated depreciation at the date of revaluation is eliminated against the gross carrying amount of the asset
and the net amount is restated to the revalued amount of the asset. The revaluation increase arising on the revaluation of property, plant
and equipment is credited to the revaluation surplus in shareholders’ equity. Decreases that offset previous increases of the same asset are
charged against the non-distributable reserve. All other decreases are charged to the statement of comprehensive income.

Subsequent expenditures are included in the asset’s carrying amount or are recognised as a separate asset only when it is probable that
future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying
amount of a replaced part is derecognised. All other repair and maintenance costs are charged to profit or loss during the financial period
in which they are incurred.

Depreciation is recognised in profit or loss on a straight-line basis to write off the gross value less residual amounts over their estimated
useful lives as follows:

Buildings - 2.5%
Motor vehicles - 25%
Furniture and equipment - 20%
Computers - 33.33%

Freehold land is not depreciated.

Ecobank Ghana Annual Report 2016 81

Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

2.14 PROPERTY AND EQUIPMENT (CONT’D)

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period. Assets are
reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its
estimated recoverable amount. The recoverable amount is the higher of the asset’s fair value less costs to sell and value in use.
Gains and losses on disposal are determined by comparing proceeds with carrying amounts and are recorded in profit or loss.

2.15 INTANGIBLE ASSETS

Computer software

Intangible assets comprise computer software licences. Intangible assets are recognised at cost. Intangible assets with a definite
useful life are amortised using the straight-line method over their estimated useful life, is 3 years. At the end of each reporting
period, intangible assets are reviewed for indications of impairment or changes in estimated future economic benefits. If such
indications exist, the intangible assets are analysed to assess whether their carrying amount is fully recoverable. An impairment loss
is recognised if the carrying amount exceeds the recoverable amount.

2.16 ASSETS HELD FOR SALE

Non-current assets are classified as held-for-sale if it is highly probable that they will be recovered primarily through sale rather than
through continuing use.

Such assets are generally measured at lower of their carrying amount and fair value less costs to sell. Impairment losses on initial
classification as held-for-sale and subsequent gains and losses on remeasurement are recognized in profit or loss.

Once classified as held-for-sale, property and equipment are no longer amortised or depreciated.

2.17 IMPAIRMENT OF NON-FINANCIAL ASSETS

Intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may
not be recoverable. An impairment loss is recognised in the statement of comprehensive income for the amount by which the asset’s
carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and
value in use.

For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash
flows (cash-generating units). The impairment test also can be performed on a single asset when the fair value less cost to sell or
the value in use can be determined reliably. Non-financial assets that suffer impairment are reviewed for possible reversal of the
impairment at each reporting date.

82 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

2.18 INCOME TAX

(a) Current tax

The tax expense for the period comprises current and deferred tax. Tax is recognised in the income statement, except to the extent that it
relates to items recognised in other comprehensive income or directly in equity. In which case, the corresponding tax is recognised in other
comprehensive income or directly in equity respectively.

The current income tax charge is calculated on the basis of tax laws enacted or substantially enacted at the reporting date and any
adjustments to tax payable in respect of previous years.

(b) Deferred tax

Deferred tax is recognised, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and
their carrying amounts in the financial statements. Deferred tax liabilities are not recognised if they arise from the initial recognition of
goodwill or from the initial recognition of an asset or liability in a transaction other than a business combination that at the time of the
transaction neither affects accounting nor taxable profit or loss. Deferred tax is determined using tax rates that have been enacted or
substantially enacted by the reporting date and are expected to apply when the related deferred tax asset or liability is realised.

Deferred tax assets are recognised only to the extent that it is probable that future taxable profits will be available against which the
temporary differences can be utilized.

Deferred tax is provided on temporary differences except for deferred tax liabilities where the timing of reversal of the temporary difference
is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities
and when the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority or either the same entity or
different taxable entities where there is an intention to settle balances on a net basis.

2.19 PROVISIONS

Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events that can be reliably
estimated and it is probable that an outflow of resources will be required to settle the obligation. Restructuring provisions comprise lease
termination penalties and employee termination payments. Provisions are not recognised for future operating losses.

Where there are a number of similar obligations which are likely to result in an outflow to settle related classes of obligations as a whole,
a provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be
small.

Provisions are measured at the present value of expenditures expected to be required to settle obligations using pre-tax rates that reflect
current market assessments of the time value of money and risks specific to the obligation. An increase in the provision due to passage of
time is recognised as an interest expense.

Ecobank Ghana Annual Report 2016 83

Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

2.20 FINANCIAL GUARANTEE CONTRACTS AND LOAN COMMITMENTS

Financial guarantee contracts are contracts that require the issuer to make specified payments to reimburse the holder for a loss
it incurs because a specified debtor fails to make payments when due, in accordance with the terms of a debt instrument. Such
financial guarantees are given to financial institutions and other bodies on behalf of customers to secure loans and overdrafts. Loan
commitments’ are firm commitments to provide credit under pre-specified terms and conditions.

Financial guarantees and loan commitments are initially recognised at the fair value and amortised over the life of contract. The
financial guarantee or loan commitment is subsequently carried at the higher of the amortised amount and the present value of any
expected payments, when payment becomes probable.

2.21 STATED CAPITAL

Ordinary shares

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares are recognized as a
deduction from equity net of any tax effects.

Dividends on ordinary shares

Dividends on ordinary shares are recognised in equity in the period in which they are approved by the shareholders.

2.22 FIDUCIARY ACTIVITIES

The Group acts as trustees and in other fiduciary capacities that result in the holding or placing of assets on behalf of individuals,
trusts, retirement benefit plans and other institutions. These assets and income arising thereon are excluded from these financial
statements, as they are not assets of the Group.

2.23 POST BALANCE SHEET EVENTS

Events subsequent to the balance sheet date are reflected in the financial statements only to the extent that they relate to the year
under consideration and the effect is material.

2.24 EMPLOYMENT BENEFITS

Defined contribution plans

Obligations for contributions to defined contribution pension plans are recognised as an expense in the profit or loss when they are
due.

Short-term benefits

Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided.
A provision is recognised for the amount expected to be paid under short-term cash bonus or profit sharing plans, if the Bank has a
present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation
can be estimated reliably.

84 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

2.25 EARNINGS PER SHARE

The Bank presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated by dividing the profit or
loss attributable to ordinary shareholders by the number of ordinary shares outstanding during the period. The Bank has no convertible
notes and share options, which could potentially dilute its EPS and therefore the Bank’s Basic and diluted EPS are essentially the same.

3. FINANCIAL RISK MANAGEMENT

The Group’s business involves taking on risks in a targeted manner and managing them professionally. The core functions of the Group’s
risk management are to identify all key risks for the Group, measure these risks, manage the risk positions and determine capital allocations.

The Group regularly reviews its risk management policies and systems to reflect changes in markets, products and best market practices.
The Group’s aim is to achieve an appropriate balance between risk and return and minimise potential adverse effects on the Group’s
financial performance.

The Group defines risk as the possibility of losses or profits foregone, which may be caused by internal or external factors.

Risk management is carried out by the risk department under policies approved by the Board of Directors. The department identifies,
evaluates financial risks in close co-operation with the Group’s operating units. The Board provides guiding principles for overall risk
management, as well as written policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, use of derivative
financial instruments and non-derivative financial instruments. In addition, internal audit is responsible for the independent review of risk
management and the control environment.

The risks arising from financial instruments to which the Group is exposed are financial risks; which includes credit risk, liquidity risk,
market risk and operational risk (which are discussed below).

Credit Risk

Credit risk is the risk of suffering financial loss, should any of the Group’s customers, market counterparties fail to fulfil their contractual
obligations to the Group. Credit risk arises mainly from commercial and consumer loans and advances, credit cards, and loan commitments
arising from such lending activities, but can also arise from credit enhancement provided, such as financial guarantees, letters of credit,
endorsements and acceptances. The Group is also exposed to other credit risks arising from investments in debt securities and other
exposures arising from trading activities (‘trading exposures’), including non-equity trading portfolio assets, derivatives and settlement
balances with market counterparties and reverse repurchase loans. Credit risk is the single largest risk for the Group’s business;
management carefully manages its exposure to credit risk. Credit risk management and control are centralised in a credit risk management
team, which reports to the Board of Directors and heads of each business unit regularly.

3.1.1 CREDIT RISK MEASUREMENT

(a) Loans and advances (including loan commitments and guarantees)

The estimation of credit exposure is complex and requires the use of models, as the value of a product varies with changes in market
variables, expected cash flows and the passage of time. The assessment of credit risk of a portfolio of assets entails further estimations as
to the likelihood of defaults occurring, associated loss ratios and of default correlations between counterparties

Ecobank Ghana Annual Report 2016 85

Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

(a) Loans and advances (including loan commitments and guarantees) (cont’d)

The Group has developed models to support the quantification of credit risk. These rating and scoring models are used for all key
credit portfolios and form the basis for measuring default risks. In measuring credit risk of loans and advances at a counterparty
level, the Group considers three components: (i) the ‘probability of default’ (PD) by the client or counterparty on its contractual
obligations; (ii) current exposures to the counterparty and its likely future development, from which the Group derive the ‘exposure
at default’ (EAD); and (iii) the likely recovery ratio on defaulted obligations (the ‘loss given default’) (LGD). The models are reviewed
regularly to monitor their robustness relative to actual performance and amended as necessary to optimise their effectiveness.

(b) Debt securities

For debt securities, external ratings such as Standard & Poor’s rating or their equivalents are used by Group Treasury to manage
credit risk exposures, supplemented by the Group’s own assessment through the use of internal rating tools.

Longer-term finance and lending to corporate entities are generally secured. In addition, in order to minimise credit loss, the Group
seeks additional collateral from counterparties as soon as impairment indicators are identified for relevant individual loans and
advances.

Collateral held as security for financial assets other than loans and advances depends on the nature of the instrument.

3.1.2 IMPAIRMENT POLICIES

Impairment allowances are recognised for financial reporting purposes only for losses that have been incurred at the reporting date
based on objective evidence of impairment.

86 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

3.1.3 MAXIMUM EXPOSURE TO CREDIT RISK BEFORE COLLATERAL HELD

Credit risk exposures relating to on-balance sheet assets were as follows:

The Group The Bank

Note 2016 2015

GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Assets

Cash and cash equivalents 2,998,879 2,022,224 2,997,543 2,021,147

Investment securities 641,010 728,874 578,985 594,255

Loans and advances to customers 3,480,544 3,117,873 3,480,471 3,116,749

7,120,433 5,868,971 7,056,999 5,732,151

Credit risk exposures relating to

off-balance sheet items are as follows:

Financial guarantees 611,255 600,775 611,255 600,775

Loan commitments and other credit related liabilities 3,809,333 4,320,320 3,809,333 4,320,320

4,420,588 4,921,095 4,420,588 4,921,095

At 31 December 11,541,021 10,790,066 11,477,587 10,653,246

Ecobank Ghana Annual Report 2016 87

Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

3.1.3 MAXIMUM EXPOSURE TO CREDIT RISK BEFORE COLLATERAL HELD (CONT’D)

The above represents the maximum exposure to credit risk at 31 December 2016 and 2015, without taking account of any collateral
held or other credit enhancements attached. For on-balance-sheet assets, the exposures set out above are based on net carrying
amounts reported in the consolidated statement of financial position.

As shown above, 48% (2015: 47%) of the total on balance sheet exposure is derived from loans and advances to customers. Included
in cash and bank balances and investment securities are loans and advances to banks and investments held in government securities
which forms 28% (2015: 22%) and 8% (2015: 11%) of the total on balance sheet exposure respectively.

Management is confident in its ability to continue controlling and sustaining minimal exposure to credit risk arising from both its
loans and advances portfolio and investment securities.

3.1.4 CREDIT QUALITY PER CLASS OF FINANCIAL ASSET

The credit quality of financial asset is managed by the group using internal credit ratings. The table below shows the credit quality by
class of financial assets and the allowance for impairment losses held by the group against those assets.

88 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

(a) Loans and advances

2016 2015

Loans and Loans and Loans and Loans and

advances advances advances advances
to Banks to Customers to Banks to Customers
GH¢’000 GH¢’000 GH¢’000 GH¢’000
The Group

Neither past due or impaired 2,270,570 2,890,518 1,450,007 2,610,684

Past due but not impaired - 110,324 - 76,703

Individually impaired - 566,267 - 590,156

Gross 2,270,570 3,567,109 1,450,007 3,277,543

Less: allowance for impairment - (86,565) - (159,670)

Net 2,270,570 3,480,544 1,450,007 3,117,873

The Bank

Neither past due or impaired 2,269,234 2,890,140 1,448,930 2,609,282

Past due but not impaired - 110,324 - 76,703

Individually impaired - 566,267 - 590,156

Gross 2,269,234 3,566,731 1,448,930 3,276,141

Less: allowance for impairment - (86,260) - (159,392)

Net 2,269,234 3,480,471 1,448,930 3,116,749

The maximum exposure held relating to Balances with Bank of Ghana included in cash and bank balances and investment securities
have been disclosed in note 3.1.3. These amounts were held with reputable institutions and are still collectible in full and therefore
no impairment losses were recognised on them.

Ecobank Ghana Annual Report 2016 89

Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

(b) Loans and advances neither past due nor impaired

The credit quality of the portfolio of loans and advances to customers that were neither past due nor impaired can be assessed by reference to
the internal rating system adopted by the Group based on the various business segments.

As at the end of the year 2016, the Bank operated the following business units:

(a) Consumer banking - This is personal banking and specializes in serving the Premier, Advantage, Classic and Direct customers

(b) Commercial Banking - This is Business Banking with the following sub-segments SMEs, Medium Local corporates and Non-government
public sector (schools, faith, NGOs & professional bodies)

(b) Corporate banking - Specializes in serving the public sector, multinational institutions, financial institutions/international organizations
and the Regional Corporate segment of the market.

The Business Units of the Bank have been re-structured along the above lines effective 1st January 2016

AT 31 DECEMBER 2016
THE GROUP

CONSUMER COMMERCIAL CIB

OVERDRAFTS CREDIT TERM MORTGAGES OVERDRAFTS TERM OVERDRAFTS TERM TOTAL
CARDS LOANS LOANS LOANS

GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Grades

Current 11,527 9,880 194,396 181,372 122,004 118,752 523,135 1,617,818 2,778,884

OLEM - - 21 - - 19,354 7,957 84,302 111,634

11,527 9,880 194,417 181,372 122,004 138,106 531,092 1,702,120 2,890,518

AT 31 DECEMBER 2015
Grades

Current 69,650 5,373 176,380 121,254 79,177 200,505 746,197 668,741 2,067,277

OLEM 3,515 - 14,396 - 3,995 16,365 128,006 377,130 543,407

73,165 5,373 190,776 121,254 83,172 216,870 875,203 1,045,871 2,610,684

90 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

AT 31 DECEMBER 2016
THE BANK CONSUMER COMMERCIAL CIB
OVERDRAFTS CREDIT TERM MORTGAGES OVERDRAFTS TERM OVERDRAFTS TERM TOTAL
CARDS LOANS LOANS LOANS

GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Grades

Current 11,527 9,880 194,396 181,372 122,004 118,752 523,135 1,617,440 2,778,506

OLEM - - 21 - - 19,354 7,957 84,302 111,634

11,527 9,880 194,417 181,372 122,004 138,106 531,092 1,701,742 2,890,140

AT 31 DECEMBER 2015
Grades

Current 69,650 5,373 176,380 121,254 79,177 200,505 746,197 667,339 2,065,875

OLEM 3,515 - 14,396 - 3,995 16,365 128,006 377,130 543,407

73,165 5,373 190,776 121,254 83,172 216,870 874,203 1,044,469 2,609,282

(c) Loans and advances individually impaired

Loans and advances less than 90 days past due are not considered impaired, unless other information is available to indicate the contrary.
Gross amounts of loans and advances by class of customers that were past due but not impaired were as follows:

AT 31 DECEMBER 2016
THE GROUP AND THE BANK

CONSUMER COMMERCIAL CIB

OVERDRAFTS TERM LOANS OVERDRAFTS TERM LOANS OVERDRAFTS TERM LOANS TOTAL

GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Past due up to 30 days - 54 - - - 109,752 109,806

Past due 30-60 days - 4 - 514 - - 518
Past due 60-90 days - - - - - - -

- 58 - 514 - 109,752 110,324

AT 31 DECEMBER 2015
Past due up to 30 days - 356 - 402 - 73,061 73,819
Past due 30-60 days - 2,884 - - - - 2,884
Past due 60-90 days - - - - - - -

- 3,240 - 402 - 73,061 76,703

Ecobank Ghana Annual Report 2016 91

Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

(d) Loans and advances individually impaired

A breakdown of the gross amount of individually impaired loans and advances by class, along with the fair value of related collateral held by
the bank as security, is as follows:

AT 31 DECEMBER 2016
THE GROUP
CONSUMER COMMERCIAL CIB

OVERDRAFTS TERM LOANS OVERDRAFTS TERM LOANS OVERDRAFTS TERM LOANS TOTAL

GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Individually impaired loans - - 67 19,165 7,957 539,078 566,267

Impairment allowance - - 63 13,500 6,862 23,014 43,439
Fair value of collateral - - 1,590 15,363 1,407 16,380 34,740

AT 31 DECEMBER 2015

Individually impaired loans 23,083 154,078 26,094 174,175 - 212,726 590,156

Impairment allowance 7,380 29,829 8,343 33,720 - 66,344 145,616
Fair value of collateral 573 2,939 648 3,322 - 6,676 14,158

THE BANK
At 31 December 2016

Individually impaired loans - - 67 19,165 7,957 539,078 566,267

Impairment allowance - - 63 13,500 6,862 23,014 43,439
Fair value of collateral - - 1,590 15,363 1,407 16,380 34,740

At 31 December 2015

Individually impaired loans 23,083 154,078 26,094 174,175 - 212,726 590,156

Impairment allowance 7,380 29,829 8,343 33,720 - 66,344 145,616
Fair value of collateral 573 2,939 648 3,322 - 6,676 14,158

92 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

(e) Loans and advances renegotiated

Restructuring activities include extended payment arrangements, approved external management plans, modification and deferral of
payments. Restructuring policies and practices are based on indicators or criteria which, in the judgment of management, indicate that
payment will most likely continue.

These policies are kept under continuous review. Restructuring is most commonly applied to term loans.

Loans and advances to customers

The Group and The Bank 2016 2015

GH¢’000 GH¢’000

Continuing to be impaired after restructuring (included in non-performing loans) 1,560 342,748

Non-impaired after restructuring – would otherwise have been impaired 104,451 67,943

(f) Repossessed collateral

During the year ended 31 December, the Group took possession of the following collateral held as security:

The Group and The Bank

2016 2015

Collateral Related Collateral Related

Loan Loan
GH¢’000 GH¢’000 GH¢’000 GH¢’000

Commercial property 66,063 101,554 3,256 7,512

Vehicles and equipment 211 932 825 1,574

66,274 102, 486 4,081 9,086

Ecobank Ghana Annual Report 2016 93

Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)
Repossessed properties are sold as soon as practicable and the proceeds used to reduce outstanding indebtedness. The group does not
generally use the non-cash collateral for its own operations.

3.2 MARKET RISK

Market risk is the risk of loss arising from adverse changes in market conditions (interest rates, exchange rates and equity prices) during
the period. Positions that expose the Group to market risk can be trading or non-trading related. Trading risk comprises positions that
the Group holds as part of its trading or market-making activities, whereas non-trading risk includes discretionary positions that the Group
undertake for liquidity.

3.2.1 Risk identification

The Group identifies market risk through daily monitoring of levels and profit and loss balances of trading and non-trading positions. The
Market Risk Controller together with the risk department monitor daily trading activities to ensure that risk exposures taken are within
approved limits and overall risk tolerance levels set by the Board. In addition, Assets and Liabilities Committee (ALCO) members, the
Treasurer, the Chief Finance Officer and the Country Risk Manager monitor market risk factors that affect the value of trading and non-
trading positions as well as income streams on non-trading portfolios on a daily basis. They also track liquidity indicators to ensure that
Group subsidiaries meet their financial obligations at all times.

3.2.2 Interest rate risk

Interest rate risk is the exposure of current and future earnings and capital to adverse changes in the level of interest rates. Exposure to
interest rate risk can result from a variety of factors, including:

(i) Differences between the timing of market interest rate changes and the timing of cash flows (repricing risk);
(ii) Changes in the market interest rates producing different effects on yields on similar instruments with different maturities (yield
curve risk); and
(iii) Changes in the level of market interest rates producing different effects on rates received or paid on instruments with similar
repricing characteristics (basis risk).

The Asset and Liability Management (“ALM”) process, managed through ALCO, is used to manage interest rate risks associated with the non-
trading book. Gap analysis is used in measuring interest rate risk. It compares the values of interest rate sensitive assets and liabilities that
mature or are re-priced at various time periods in the future. Subjective judgment/assumptions are made about the behavior of assets and
liabilities which do not have specific contractual maturity or re-pricing dates.

Interest rate risk evaluates potential volatility to net interest income caused by changes in market interest rates and represents the most
significant market risk exposure to the Group’s non-trading book.

94 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

3.2.2 Interest rate risk (Cont’d)

The Group uses gap analysis to measure its exposure to interest rate risk. Through this analysis, it compares the values of interest rate sensitive
assets and liabilities that mature or reprice at various time periods in the future. The Group may make judgmental assumptions about the behaviour
of assets and liabilities which do not have specific contractual maturity or repricing dates.

The table below summarises the repricing profiles of the bank’s financial instruments and other assets and liabilities at 31 December 2016. Items are
allocated to time periods with reference to the earlier of the next contractual interest rate re-pricing and maturity dates.

AT 31 DECEMBER 2016
THE GROUP
UP TO 1-3 3-12 OVER NON-INTEREST TOTAL
1 MONTH MONTHS MONTHS 1 YEAR BEARING
GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Assets
Cash and bank balances 563,541 651,697 222,269 - 1,755,695 3,193,202
Investment securities 294,769 31,500 34,122 278,471 2,148 641,010
Loans and advances to customers 958,849 376,482 527,162 1,618,051 - 3,480,544
Other assets - - - - 311,497 311,497

Total financial assets 1,817,159 1,059,679 783,553 1,896,522 2,069,340 7,626,253

Liabilities
Deposits from Banks 345,284 64,042 69,216 - 64,314 542,856
Customer deposits 1,030,001 26,356 75,044 863 4,284,652 5,416,916
Borrowings - - 535 232,209 - 232,744
Other liabilities - - - - 893,477 893,477

Total financial liabilities 1,375,285 90,398 144,795 233,072 5,242,443 7,085,993

Total interest re-pricing gap 441,874 969,281 638,758 1,663,450 (3,173,103) 540,260

Ecobank Ghana Annual Report 2016 95

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

3.2.2 Interest rate risk (Cont’d)

AT 31 DECEMBER 2015 UP TO 1-3 3-12 OVER NON-INTEREST TOTAL

THE GROUP 1 MONTH MONTHS MONTHS 1 YEAR BEARING
GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Assets
Cash and bank balances 536,501 147,425 227,910 - 1,311,113 2,222,949
Investment securities 513,072 116,030 39,160 58,464 2,148 728,874
Loans and advances to customers 1,131,237 72,555 455,419 1,458,662 - 3,117,873
Other assets - - - - 307,315 307,315

Total financial assets 2,180,810 336,010 722,489 1,517,126 1,620,576 6,377,011

Liabilities
Deposits from Banks 130,469 24,199 26,154 - 24,301 205,123
Customer deposits 919,913 23,539 67,023 771 3,826,704 4,837,950
Borrowings - 128 1,601 320,247 - 321,976
Other liabilities - - - - 437,008 437,008

Total financial liabilities 1,050,382 47,866 94,778 321,018 4,288,013 5,802,057

Total interest re-pricing gap 1,130,428 288,144 627,711 1,196,108 (2,667,437) 574,954

96 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

3.2.2 Interest rate risk (Cont’d)

UP TO 1-3 3-12 OVER NON-INTEREST TOTAL

AT 31 DECEMBER 2016 1 MONTH MONTHS MONTHS 1 YEAR BEARING
THE BANK GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Assets
Cash and bank balances 562,857 651,132 222,182 - 1,755,695 3,191,866
Investment securities 264,857 6,111 27,939 277,930 2,148 578,985
Loans and advances to customers 958,839 376,419 527,162 1,618,051 - 3,480,471
Other assets - - - - 324,436 324,436

Total financial assets 1,786,553 1,033,662 777,283 1,895,981 2,082,279 7,575,758

Liabilities
Deposits from Banks 345,284 64,042 69,216 - 151,746 630,288
Customer deposits 1,030,001 26,356 75,044 863 4,184,361 5,316,625
Borrowings - - 535 232,209 - 232,744
Other liabilities - - - - 886,835 886,835

Total financial liabilities 1,375,285 90,398 144,795 233,072 5,222,942 7,066,492

Total interest re-pricing gap 411,268 943,264 632,488 1,662,909 (3,140,663) 509,266

AT 31 DECEMBER 2015
Assets
Cash and bank balances 536,501 147,425 227,910 - 1,310,036 2,221,872
Investment securities 460,541 62,542 13,125 55,899 2,148 594,255
Loans and advances to customers 1,130,113 72,555 455,419 1,458,662 - 3,116,749
Other assets - - - - 327,184 327,184

Total financial assets 2,127,155 282,522 696,454 1,514,561 1,639,368 6,260,060

Liabilities
Deposits from Banks 170,969 55,199 36,465 - 24,301 286,934
Customer deposits 778,760 13,112 45,834 771 3,826,036 4,664,513
Borrowings - 128 1,601 320,247 - 321,976
Other liabilities - - - - 433,036 433,036

Total financial liabilities 949,729 68,439 83,900 321,018 4,283,373 5,706,459

Total interest re-pricing gap 1,177,426 214,083 612,554 1,193,543 (2,644,005) 553,601

Ecobank Ghana Annual Report 2016 97

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

3.2.3 Foreign exchange risk

Foreign exchange risk is measured through the statement of comprehensive income. The Group takes on exposure to the effects of fluctuations in
the prevailing foreign currency exchange rates on its financial position and cash flows. The Board sets limits on the level of exposure by currency and
in total for both overnight and intra-day positions. The table below summarises the company’s exposure by currency exchange rates on its financial
position and cash flows.

EUR USD GBP GH¢’ OTHERS TOTAL

AT 31 DECEMBER 2016
THE GROUP GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Assets
Cash and bank balances 196,245 1,722,525 69,905 1,192,666 11,861 3,193,202
Investment securities - 260,427 - 380,583 - 641,010
Loans and advances to customers 3,031 1,413,115 - 1,662,345 402,053 3,480,544
Other assets 751 18,031 6 323,474 - 342,262

Total 200,027 3,414,098 69,911 3,559,068 413,914 7,657,018

Liabilities
Deposits from Banks 41,172 411,246 489 89,949 - 542,856
Deposits due to customers 135,323 2,366,164 65,986 2,519,447 329,996 5,416,916
Other liabilities 816 348,413 76 544,172 - 893,477
Borrowings - 227,934 - 4,810 - 232,744

Total 177,311 3,353,757 66,551 3,158,378 329,996 7,085,993

Net on balance sheet position 22,716 60,341 3,360 400,690 83,918 571,025

Credit commitments 948,200 892,512 - 1,174,788 793,833 3,809,333

98 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

3.2.3 Foreign exchange risk (Cont’d)

EUR USD GBP GH¢’ OTHERS TOTAL

AT 31 DECEMBER 2015
THE GROUP GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Assets
Cash and bank balances 194,371 865,380 80,167 1,072,219 10,812 2,222,949
Investment securities - 41,745 - 687,129 - 728,874
Loans and advances to customers 6,906 1,533,925 93 1,576,949 - 3,117,873
Other assets 516 26,867 - 307,864 - 335,247

Total 201,793 2,467,917 80,260 3,644,161 10,812 6,404,943

Liabilities
Deposits from Banks 21,712 79,159 - 104,252 - 205,123
Deposits due to customers 172,809 1,886,220 74,293 2,693,896 10,732 4,837,950
Other liabilities 1,333 118,590 240 316,845 - 437,008
Borrowings - 312,462 - 9,514 - 321,976

Total 195,854 2,396,431 74,533 3,124,507 10,732 5,802,057

Net on balance sheet position 5,939 71,486 5,727 519,654 80 602,886

Credit commitments 1,075,392 1,012,234 - 1,332,375 900,319 4,320,320

Ecobank Ghana Annual Report 2016 99

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

3.2.3 Foreign exchange risk (Cont’d)

EUR USD GBP GH¢’ OTHERS TOTAL

AT 31 DECEMBER 2016
THE BANK GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Assets
Cash and bank balances 196,245 1,722,525 69,905 1,191,331 11,860 3,191,866
Investment securities - 260,427 - 318,558 - 578,985
Loans and advances to customers 3,031 1,360,856 - 1,714,532 402,052 3,480,471
Other assets 751 18,031 6 336,411 1 355,200

Total 200,027 3,361,839 69,911 3,560,832 413,913 7,606,522

Liabilities
Deposits from Banks 41,172 411,246 489 73,990 103,391 630,288
Deposits due to customers 135,323 2,366,164 65,986 2,449,155 299,997 5,316,625
Other liabilities 816 340,272 76 545,671 - 886,835
Borrowings - 227,934 - 4,810 - 232,744

Total 177,311 3,345,616 66,551 3,073,626 403,388 7,066,492

Net on balance sheet position 22,716 16,223 3,360 487,206 10,525 540,030

Credit commitments 948,200 892,512 - 1,174,788 793,833 3,809,333

100 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

3.2.3 Foreign exchange risk (Cont’d)

EUR USD GBP GH¢’ OTHERS TOTAL

AT 31 DECEMBER 2015
THE BANK GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Assets
Cash and bank balances 194,370 865,380 80,168 1,071,142 10,812 2,221,872
Investment securities - 41,745 - 552,510 - 594,255
Loans and advances to customers 6,906 1,433,925 93 1,675,825 - 3,116,749
Other assets 516 26,867 - 326,705 - 354,088

Total 201,792 2,367,917 80,261 3,626,182 10,812 6,286,964

Liabilities
Deposits from Banks 21,712 79,159 - 186,063 - 286,934
Deposits due to customers 172,809 1,786,220 74,293 2,620,459 10,732 4,664,513
Other liabilities 1,333 118,590 240 312,873 - 433,036
Borrowings - 312,462 - 9,514 - 321,976

Total 195,854 2,296,431 74,533 3,128,909 10,732 5,706,459

Net on balance sheet position 5,938 71,486 5,728 497,273 80 580,505

Credit commitments 1,075,392 1,012,234 - 1,332,375 900,319 4,320,320

The following significant exchange rates applied during the year - GH¢1 to:

Average Rate Reporting rate

THE GROUP AND THE BANK 2016 2015 2016 2015

USD1 3.9120 3.7714 4.2002 3.7950

GBP1 5.2896 5.7475 5.1965 5.6160

EURO1 4.3277 4.1592 4.4367 4.1320

XOF1 0.0100 0.0100 0.0067 0.0063

Ecobank Ghana Annual Report 2016 101

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

3.2.4 Market risk measurement techniques

The Group applies the ‘value at risk’ methodology (VAR) to its trading and non-trading portfolios, to estimate exposure to market risk of positions held
and maximum losses expected, based on a number of assumptions for various changes in market conditions. The Board sets limits on the value of
risk that may be accepted for the Group, trading and non-trading separately, which are monitored on a daily basis by Group Treasury.

VAR is a statistically based estimate of the potential loss on the current portfolio from adverse market movements. It expresses the ‘maximum’
amount the Group might lose, but only to a certain level of confidence (98%).

There is therefore a specified statistical probability (2%) that actual loss could be greater than the VAR estimate. The VAR model assumes a certain
‘holding period’ until positions can be closed (10 days). It also assumes that market movement occurring over this holding period will follow a similar
pattern to those that have occurred over the preceeding10-day period in the past.

The Group’s assessment of past movements is based on data for the past five years. The Group applies these historical changes in rates, prices,
indices, etc. directly to its current positions − a method known as historical simulation. Actual outcomes are monitored regularly to test the validity of
assumptions and parameters/factors used in the VAR calculation.

The use of this approach does not prevent losses outside of these limits in the event of more significant market movements.

2016 2015
THE GROUP AND THE BANK LOW AVERAGE HIGH LOW AVERAGE HIGH
GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Foreign exchange risk 87 295 637 36 216 432

Interest rate risk 56 63 89 39 161 437

3.2.5 Risk monitoring and control

The Risk Management department is responsible for reviewing exposure to market risk. The Treasury department monitors interest rate and liquidity
risks through daily, weekly, and monthly reviews of the structure and pricing of assets and liabilities. Assets and Liability Committee (ALCO) meetings
are also held monthly.

The Bank analyses the impact of unlikely, but not impossible events by means of scenario analysis, which enables management gain a better
understanding of risks that it could be exposed to in extreme conditions. Both historical and hypothetical events are tested.

3.2.6 Risk reporting

Reports on the bank’s positions are reviewed daily by the Internal Audit and Compliance Unit. Reports include foreign currency positions and liquidity
positions in all currencies. Variations to expectations are reviewed and corrected if need be.

102 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

3.3 LIQUIDITY RISK

The management of liquidity risk is governed by the Bank’s liquidity policy. Responsibility for the management of liquidity risk lies with
the Bank’s Assets and Liability Management Committee (ALCO), which is chaired by an Executive Director. ALCO is responsible for both
statutory and prudential liquidity as well as compliance with regulatory requirements.

The primary objective of liquidity risk management is to provide a planning mechanism for unanticipated changes in demand or needs for
liquidity created by customer behavior or abnormal market conditions. ALCO emphasizes the maximization and preservation of customer
deposits and other funding sources. ALCO also monitors deposit rates, levels, trends and significant changes.

Liquidity is managed on a short to medium-term basis. In the short term, the focus is on ensuring that cash flow demands can be met as
and when required. The focus, in the medium term, is on ensuring that the balance sheet remains structurally sound and aligned to the
bank’s strategy.

A substantial portion of the Bank’s assets are funded by customer deposits made up of current and savings accounts and other deposits.
These customer deposits, which are widely diversified by type and maturity, represent a stable source of surplus funds. Lending is normally
funded by liability in the same currency.

The Bank also maintains significant levels of marketable securities to meet compliance with prudential investment of surplus funds. ALCO
oversees structural foreign currency and interest rate exposures that arise within the Bank. These responsibilities are coordinated by ALCO
during monthly meetings. The Bank places low reliance on interbank funding and foreign markets.

The table below presents the cash flows payable under non-derivative financial liabilities and assets held for managing liquidity risk by
remaining contractual maturities at the reporting date. The amounts disclosed in the table are the contractual undiscounted cash flows,
whereas the Group manages the inherent liquidity risk based on expected undiscounted cash inflows.

Ecobank Ghana Annual Report 2016 103

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

3.3 Liquidity risk (Cont’d)

AT 31 DECEMBER 2016 UP TO 1-3 3-12 OVER TOTAL

1 MONTH MONTHS MONTHS 1 YEAR
THE GROUP
GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Liabilities
Deposits from Banks 409,598 64,042 69,216 - 542,856
Customers deposits 5,108,860 228,823 75,382 3,851 5,416,916
Other liabilities 893,477 - - - 893,477
Borrowings - - 535 232,209 232,744

6,411,935 292,865 145,133 236,060 7,085,993

Assets
Cash and bank balances 2,319,235 651,697 222,270 - 3,193,202
Investments securities 296,917 31,500 34,122 278,471 641,010
Loans and advances to customers 1,595,539 96,665 229,061 1,559,279 3,480,544
Other assets 311,497 - - - 311,497

Assets held for managing liquidity risk 4,523,188 779,862 485,453 1,837,750 7,626,253

Liquidity gap (1,888,747) 486,997 340,320 1,601,690 540,260

AT DECEMBER 2015
Liabilities
Deposits from Banks 154,770 24,199 26,154 - 205,123
Customers deposits 4,745,870 24,199 67,023 858 4,837,950
Other liabilities 437,008 - - - 437,008
Borrowings - 128 1,601 320,247 321,976

5,337,648 48,526 94,778 321,105 5,802,057

Assets
Cash and bank balances 1,847,614 147,425 227,910 - 2,222,949
Investment securities 515,220 116,030 39,160 58,464 728,874
Loans and advances to customers 1,160,693 72,555 455,419 1,429,206 3,117,873
Other assets 307,315 - - - 307,315

Assets held for managing liquidity risk 3,830,842 336,010 722,489 1,487,670 6,377,011

Liquidity gap (1,506,806) 287,484 627,711 1,166,565 574,954

104 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

3.3 Liquidity risk (Cont’d)

AT 31 DECEMBER 2016 UP TO 1-3 3-12 OVER TOTAL

1 MONTH MONTHS MONTHS 1 YEAR
THE BANK
GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Liabilities
Deposits from Banks 497,030 64,042 69,216 - 630,288
Customers Deposits 5,008,569 228,823 75,382 3,851 5,316,625
Other liabilities 886,835 - - - 886,835
Borrowings - - 535 232,209 232,744

6,392,434 292,865 145,133 236,060 7,066,492

Assets
Cash and bank balances 2,318,551 651,132 222,183 - 3,191,866
Investment securities 267,005 6,111 27,939 277,930 578,985
Loans and advances to customers 1,595,466 96,665 229,061 1,559,279 3,480,471
Other assets 324,436 - - - 324,436

Assets held for managing liquidity risk 4,505,458 753,908 479,183 1,837,209 7,575,758

Liquidity gap (1,886,976) 461,043 334,050 1,601,149 509,266

AT 31 DECEMBER 2015
Liabilities
Deposits from Banks 195,270 55,199 36,465 - 286,934
Customers Deposits 4,571,927 24,199 67,023 1,364 4,664,513
Other liabilities 433,036 - - - 433,036
Borrowings - 128 1,601 320,247 321,976

5,200,233 79,526 105,089 321,611 5,706,459

Assets
Cash and bank balances 1,846,537 147,425 227,910 - 2,221,872
Investment securities 462,689 62,542 13,125 55,899 594,255
Loans and advances to customers 1,159,569 72,555 455,419 1,429,206 3,116,749
Other assets 327,184 - - - 327,184

Assets held for managing liquidity risk 3,795,979 282,522 696,454 1,485,105 6,260,060

Liquidity gap (1,404,254) 202,996 591,365 1,163,494 553,601

Ecobank Ghana Annual Report 2016 105

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

3.4 COUNTRY ANALYSIS

2016 2015

IN GHANA OUTSIDE IN GHANA OUTSIDE

GHANA GHANA
GH¢’000 GH¢’000 GH¢’000 GH¢’000

THE GROUP
Assets
Cash and bank balances 1,985,241 1,207,961 1,181,603 1,041,346
Investment securities 641,010 - 728,874 -
Loans and advances to customers 3,480,544 - 3,117,873 -

Total assets 6,106,795 1,207,961 5,028,350 1,041,346

Liabilities
Deposits from Banks 541,979 877 203,801 1,322
Deposits due to customers 5,416,916 - 4,837,950 -
Borrowings 4,725 228,019 9,514 312,462

Total liabilities 5,963,620 228,896 5,051,265 313,784

THE BANK
Assets
Cash and bank balances 2,139,266 1,052,600 1,217,949 1,003,923
Investment securities 578,985 - 594,255 -
Loans and advances to customers 3,480,471 - 3,116,749 -

Total assets 6,198,722 1,052,600 4,928,953 1,003,923

Liabilities
Deposits from Banks 629,411 877 285,612 1,322
Deposits due to customers 5,316,625 - 4,664,513 -
Borrowings 4,725 228,019 9,514 312,462

Total liabilities 5,950,761 228,896 4,959,639 313,784

106 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

3.5 FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES

The fair values of financial assets and financial liabilities that are traded in active markets are based on quoted market prices or dealer price
quotations. For all other financial instruments, the Group determines fair values using other valuation techniques.

For financial instruments that trade infrequently and have little price transparency, fair value is less objective, and requires varying degrees
of judgment depending on liquidity, concentration, uncertainty of market factors, pricing assumptions and other risks affecting the specific
instrument.

(a) Valuation models

The Group measures fair values using the following fair value hierarchy, which reflects the significance of inputs used in making the
measurements.

Level 1: inputs that are quoted market prices (unadjusted) in active markets for identical instruments.

Level 2: inputs other than quoted prices included within Level 1 that are observable either directly (i.e. as prices) or indirectly (i.e. derived
from prices). This category includes instruments valued using: quoted market prices in active markets for similar instruments;
quoted prices for identical or similar instruments in markets that are considered less than active; or other valuation techniques
in which all significant inputs are directly or indirectly observable from market data.

Level 3: inputs that are unobservable. This category includes all instruments for which the valuation technique includes inputs not
based on observable data and the unobservable inputs have a significant effect on the instrument’s valuation. This category
includes instruments that are valued based on quoted prices for similar instruments for which significant unobservable
adjustments or assumptions are required to reflect differences between the instruments.

Valuation techniques include net present value and discounted cash flow models, comparison with similar instruments for which market
observable prices exist and other valuation models. Assumptions and inputs used in valuation techniques include risk free and benchmark
interest rates, credit spreads and other premiums used in estimating discount rates and foreign currency exchange rates and expected
price volatilities and correlations.

The objective of valuation techniques is to arrive at a fair value measurement that reflects the price that would be received to sell the asset
or paid to transfer the liability in an orderly transaction between market participants at the measurement date.

The Group uses widely recognised valuation models for determining the fair value of common and more simple financial instruments that
use only observable market data and require little management judgment and estimation.

Availability of observable market prices and model inputs reduces the need for management judgement and estimation and also reduces
the uncertainty associated with determining fair values. Availability of observable market prices and inputs varies depending on the
products and markets and is prone to changes based on specific events and general conditions in the financial markets.

Ecobank Ghana Annual Report 2016 107

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

(b) Financial instruments measured at fair value – fair value hierarchy

The following table analyses financial and non-financial assets measured at fair value at the reporting date, by the level in the fair value
hierarchy into which the fair value measurement is categorised. The amounts are based on the values recognised in the statement of
financial position.

LEVEL 1 LEVEL 2 LEVEL 3

THE GROUP AND BANK GH¢’000 GH¢’000 GH¢’000
2016
Investment securities-AFS - 2,148 -

THE GROUP AND BANK

2015
Government securities - 18,809 -
Investment securities-AFS - 2,148 -

- 20,957 -

(i) Land and Buildings

An external, independent valuation Company, having appropriate recognised professional qualifications and recent experience in the
location and category of property being valued, values the Group’s property. The fair values are based on market values, being the
estimated amount for which a property could be exchanged on the date of the valuation between a willing buyer and a willing seller in an
arm’s length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion.

(c) Financial instruments not measured at fair value

The following table sets out the fair values of financial instruments not measured at fair value in the statement of financial position,
analysed by reference to levels in the fair value hierarchy into which each fair value measurement is categorized:

108 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

(c) Financial instruments not measured at fair value

AT 31 DECEMBER 2016 LEVEL 1 LEVEL 2 LEVEL 3 TOTAL FAIR TOTALCARRYING

VALUE AMOUNT
THE GROUP
GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Non-derivative financial assets

Investment securities - 629,870 - 629,870 641,010
Loans and advances to customers - 3,347,648 - 3,347,648 3,480,544
Cash and bank balances - 2,248,526 922,632 3,171,158 3,193,202
Other assets - - 311,497 311,497 311,497

- 6,226,044 1,234,129 7,460,173 7,626,253

Non-derivative financial liabilities

Deposits from Banks - 538,232 - 538,232 542,856
Deposits from customers - 5,354,900 - 5,354,900 5,416,916
Borrowings - 230,548 - 230,548 232,744
Other liabilities - - 893,477 893,477 893,477

- 6,123,680 893,477 7,017,157 7,085,993

At 31 December 2015

Non-derivative financial assets

Investment securities - 714,990 - 714,990 728,874
Loans and advances to customers - 3,020,619 - 3,020,619 3,117,873
Cash and bank balances - 1,435,910 772,942 2,208,852 2,222,949
Other assets - - 307,315 307,315 307,315

- 5,171,519 1,080,257 6,251,776 6,377,011

Non-derivative financial liabilities

Deposits from Banks - 201,488 - 201,488 205,123
Deposits from customers - 4,747,401 - 4,747,401 4,837,950
Borrowings - 320,156 - 320,156 321,976
Other liabilities - - 437,008 437,008 437,008

- 5,269,045 437,008 5,706,053 5,802,057

Ecobank Ghana Annual Report 2016 109

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NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

(c) Financial instruments not measured at fair value

AT 31 DECEMBER 2016 LEVEL 1 LEVEL 2 LEVEL 3 TOTAL FAIR TOTALCARRYING

VALUE AMOUNT
THE BANK
GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Non-derivative financial assets

Investment securities - 568,718 - 568,718 578,985
Loans and advances to customers - 3,347,578 - 3,347,578 3,480,471
Cash and bank balances - 2,247,202 922,632 3,169,834 3,191,866
Other assets - - 324,436 324,436 324,436

- 6,163,498 1,247,068 7,410,566 7,575,758

Non-derivative financial liabilities

Deposits from Banks - 624,919 - 624,919 630,288
Deposits from customers - 5,255,756 - 5,255,756 5,316,624
Borrowings - 230,548 - 230,548 232,744
Other liabilities - - 886,835 886,835 886,835

- 6,111,223 886,835 6,998,058 7,066,491

At 31 December 2015

Non-derivative financial assets

Investment securities - 582,545 - 582,545 594,255
Loans and advances to customers - 3,019,530 - 3,019,530 3,116,749
Cash and bank balances - 1,434,844 772,942 2,207,786 2,221,872
Other assets - - 327,184 327,184 327,184

- 5,036,919 1,100,126 6,137,045 6,260,060

Non-derivative financial liabilities

Deposits from Banks - 281,849 - 281,849 286,934
Deposits from customers - 4,577,210 - 4,577,210 4,664,513
Borrowings - 320,156 - 320,156 321,976
Other liabilities - - 433,036 433,036 433,036

- 5,179,215 433,036 5,612,251 5,706,459

The fair value of government securities is based on market prices or broker/dealer price quotations. Where this information is not available,
fair value is determined using quoted market prices for securities with similar credit, maturity and yield characteristics.

110 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

(c) Financial instruments not measured at fair value (cont’d)

Where applicable, the fair value of loans and advances to customers is based on observable market transactions. Where observable
market transactions are not available, fair value is estimated using valuation models such as discounted cash flow techniques which
represents the discounted amount of estimated future cash flows expected to be received. Expected cash flows are discounted at
current market rates to determine the fair value. For collateral-dependent impaired loans, the fair value is measured based on the
value of the underlying collateral.

The fair value of advances to and from Banks is based on discounted cash flow techniques applying the rates of similar maturities and
terms.

The fair value of term deposits by customers is estimated using discounted cash flow techniques, applying the rates that are offered
for deposits of similar maturities and terms. The fair value of deposits payable on demand is the amount payable at the reporting
date.

Fair values of borrowings are estimated using discounted cash flow techniques, applying rates that are offered for borrowings of
similar maturities and terms.

No fair value disclosures are provided for investments in other equity securities that are measured at cost less any impairment losses
because their fair values cannot be measured reliably. These investments are unquoted equity investments with no observable
market data. There is no active market for these investments and the Group does not intend to dispose off these investments in the
foreseeable future.

4. CAPITAL MANAGEMENT

The Group’s objectives when managing capital include:

o Complying with capital requirements set by the Bank of Ghana

o Safeguarding the Group’s ability to continue as a going concern to enable it to continue providing returns for shareholders and
benefits for other stakeholders
o Maintaining a strong capital base to support the development of its business

Capital adequacy and the use of regulatory capital are monitored daily by management, employing techniques based on guidelines
developed by the Basel Committee as implemented by Bank of Ghana for supervisory purposes. The required information is filed with
Bank of Ghana on a monthly basis. Bank of Ghana requires each bank to:

(a) hold a minimum regulatory capital of GH¢60 million; and

(b) maintain a ratio of total regulatory capital to risk-weighted assets plus risk weighted off balance sheet assets above a required
minimum of 10%.

The Bank’s regulatory capital is divided into two tiers:

o Tier 1 capital: includes shareholders’ equity and disclosed reserves after deducting specified assets such as intangibles and certain
classes of investments.

o Tier 2 capital: includes qualifying subordinated loan capital, collective impairment allowances and unrealised gains arising on the
fair valuation of equity instruments held as available for sale.

Ecobank Ghana Annual Report 2016 111

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

4. CAPITAL MANAGEMENT (CONT’D)

The risk-weighted assets are measured by means of a hierarchy of five risk weights classified according to the nature and reflecting an
estimate of credit, market and other risks associated with each asset and counterparty. A similar treatment is adopted for off-balance sheet
exposures, with some adjustments to reflect the more contingent nature of potential losses.

The table below summarises the composition of regulatory capital and ratios of the Group for the years ended 31 December. During these
two years, the individual entities within the Group and the Group complied with all externally imposed capital requirements that they are
subject to.

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000
Tier 1 Capital
Share capital 226,641 226,641 226,641 226,641
Statutory reserves 323,124 282,412 322,623 281,923
Income surplus 271,445 272,852 260,078 263,775
Intangibles/other assets (83,003) (61,030) (102,549) (81,803)

Total qualifying tier 1 capital 738,207 720,875 706,793 690,536

Tier 2 Capital
Subordinated debt 111,706 130,916 111,706 130,916
Other reserves 50,129 59,057 50,129 58,231

Total qualifying tier 2 capital 161,835 189,973 161,835 189,147

Total regulatory capital 900,042 910,848 868,628 879,683

Risk weighted assets

On balance sheet 5,275,538 4,522,683 5,282,118 4,535,508
Off balance sheet 611,255 600,775 611,255 600,775

Total risk weighted assets 5,886,793 5,123,458 5,893,373 5,136,283

Capital adequacy ratio 15.29% 17.78% 14.74% 17.13%

The group complied with all external capital requirements.

112 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

5. CRITICAL ACCOUNTING ESTIMATES AND JUDGMENTS

The Group’s financial statements and financial results are influenced by accounting policies, assumptions, estimates and management
judgment, which necessarily have to be made in the course of preparing the financial statements.

The Group makes estimates and assumptions that affect reported amounts of assets and liabilities. All estimates and assumptions required
in conformity with IFRS are based on best estimates undertaken in accordance with applicable standards. Estimates and judgments are
evaluated on a continuous basis, based on past experience and other factors, including expectations with regard to future events.

(a) Impairment losses on loans and advances

The Group reviews its loan portfolio to assess impairment at least on a quarterly basis. In determining whether an impairment loss should
be recorded in profit or loss, the Group considers observable data that may indicate measurable decreases in estimated future cash flows
from a portfolio of loans before decreases can be identified with individual loans in that portfolio. This evidence may include observable
data indicating adverse changes in the payment status of borrowers in a group, or economic conditions that correlate with defaults on
assets in a group. Management uses estimates based on historical loss experience for assets with similar credit risk characteristics and
objective evidence

(b) Impairment of available for-sale equity investments

The Group determines that available-for-sale equity investments are impaired when there has been a significant or prolonged decline in
the fair value below its cost. The determination of what is significant or prolonged requires judgment. In making this judgment, the Group
evaluates among other factors, the normal volatility in share prices.

(c) Fair value of financial instruments

The fair value of financial instruments where no active market exists or where quoted prices are not otherwise available are determined
using valuation techniques. In these cases, fair values are estimated from observable data in respect of similar financial instruments or
using models. Models are calibrated to ensure that outputs reflect actual data and comparative market prices.

(d) Income taxes

Significant estimates are required in determining provisions for income taxes. There are many transactions and calculations for which the
ultimate tax determination is uncertain during the ordinary course of business. The Group recognises liabilities for anticipated tax liabilities
based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts
that were initially recorded, such differences are adjusted in the period in which such determination is made.

Ecobank Ghana Annual Report 2016 113

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

6. INTEREST INCOME
The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Financial assets measured at amortised cost

Placement and short-term funds 144,435 91,084 144,340 64,050
Treasury bills and Government securities 156,509 161,344 136,329 139,237
Loans and advances 604,360 591,136 598,245 587,674

905,304 843,564 878,914 790,961

7. INTEREST EXPENSE
The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Financial liabilities measured at amortised cost

Demand deposits 84,182 57,188 101,910 48,131
Time deposits 54,700 56,405 28,158 29,592
Borrowed funds 22,804 26,087 22,856 26,164
Savings 24,513 21,643 24,513 21,642

186,199 161,323 177,437 125,529

8. FEES AND COMMISSION INCOME

The Group The Bank
2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Trade finance fees 27,636 34,826 27,636 34,826

Credit related fees and commission 35,154 52,198 35,156 52,156
Cash management 50,724 54,921 50,724 54,921
Other fees and commission 46,975 47,300 46,987 47,350

160,489 189,245 160,503 189,253

114 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

9. FEE AND COMMISSION EXPENSE

The Group The Bank
2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Charges for services 3,267 3,883 3,233 3,883

10. NET TRADING INCOME

The Group The Bank
2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Foreign exchange:
- translation gains less losses 13,559 5,834 13,403 5,623
- transaction gains less losses 103,381 128,052 103,381 128,050
Interest rate instruments 13,334 4,971 13,150 4,678

130,274 138,857 129,934 138,351

11. OTHER OPERATING INCOME

The Group The Bank
2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Other revenue 11,591 9,500 11,221 9,500

Finance lease 6,471 3,682 6,470 3,674

18,062 13,182 17,691 13,174

Ecobank Ghana Annual Report 2016 115

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

12. OTHER REVENUE

The Group The Bank
2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Dividend income 4,140 3,487 16,942 23,438

13. GAINS FROM DERECOGNITION OF FINANCIAL ASSETS MEASURED AT

AMORTISED COST
The Group The Bank
2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

177,854 - 177,854 -

During the year, two (2) of Ecobank Ghana Limited’s key facilities were restructured. The new terms under the restructured facilities
resulted in a significant modification of the existing facilities leading to the derecognition of the initial facilities and subsequent recognition
of new facilities. The difference between the carrying amount of the initial facilities and the fair value of the restructured amount is
recognised as gains or loss from derecognition of financial assets measured at amortised cost.

14. OTHER INCOME

The Group The Bank
2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Profit on sale of equipment 291 184 291 184

116 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

15. NET IMPAIRMENT LOSS ON FINANCIAL ASSET

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Impairment charge
Loan impairment:
Individual 174,870 158,076 174,870 158,076
Collective 29,072 (23,906) 29,045 (23,948)
Recoveries (25,345) (18,375) (25,345) (18,375)

Charge to income statement 178,597 115,795 178,570 115,753

Impairment allowance
At 1 January 159,670 65,412 159,392 65,176
Increase in impairment 178,597 115,795 178,570 115,753
Released on loan derecognised (90,211) - (90,211) -
Amounts written off during the year as uncollectible (161,491) (21,537) (161,491) (21,537)

At 31 December 86,565 159,670 86,260 159,392

16. PERSONNEL EXPENSES

The Group The Bank
2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Personnel expenses comprise:

Wages and salaries 184,345 140,037 184,095 139,827
Social security fund contribution 16,041 11,288 16,017 11,264
Other allowances 115,973 94,799 115,881 94,705

316,359 246,124 315,993 245,796

Ecobank Ghana Annual Report 2016 117

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

17. DEPRECIATION & AMORTISATION

The Group The Bank
2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Depreciation of property and equipment 17,115 15,124 17,114 15,109

Amortisation of software 4,419 4,524 4,419 4,524

21,534 19,648 21,533 19,633

18. OTHER EXPENSES

The Group The Bank
2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Rent 16,439 15,407 16,363 15,390

Travel 7,675 8,871 7,675 8,871
Technology and communication 72,877 56,936 72,877 56,927
Business promotion 13,051 13,077 13,051 13,077
Advertising 3,650 1,799 3,650 1,799
Training 5,726 4,235 5,726 4,235
Audit fees 718 635 581 513
Directors’ fees 1,000 1,000 1,000 1,000
Repairs and maintenance 9,756 8,612 9,756 8,612
Utilities 14,717 6,944 14,675 6,899
Other administrative expenses * 79,472 63,675 79,436 63,522
Corporate social responsibility (Note 47) 3,387 2,843 3,387 2,843

228,468 184,034 228,177 183,688

*The major administrative expenses include stationery and supplies, insurance, office security, printing, fuel, cash in transit overheads and
legal fees.

The number of persons employed by the Group at the year-end was 1,617 (2015:1,465).

118 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

19. INCOME TAX

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Income tax expense

Current tax 113,738 111,503 111,064 108,366
National fiscal stabilisation Levy (Note 19) 22,737 23,679 22,219 23,054
Deferred tax (Note 20) (1,695) 2,112 (1,691) 2,136

134,780 137,294 131,592 133,556

The tax on the Group and the Bank’s profit before tax differs from the theoretical amount that would arise using the basic tax rate as
follows:

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Profit before tax 462,676 458,560 457,186 461,079

Corporate tax rate at 25% (2015: 25%).

Tax using the bank’s domestic tax rate 115,669 114,640 114,296 115,270
Tax incentives (17) (13) (17) (13)
Non-deductible (521) 5,926 (529) 1,151
Tax exempt income (3,088) (6,938) (4,377) (5,906)
National fiscal stabilisation levy 22,737 23,679 22,219 23,054

Income tax expense 134,780 137,294 131,592 133,556

Effective tax rates 29% 30% 30% 29%

Ecobank Ghana Annual Report 2016 119

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

The movement on corporate tax payable was as follows:

BALANCE AT CHARGE FOR BALANCE AT

1 JANUARY THE YEAR PAYMENT 31 DECEMBER
GH¢’000 GH¢’000 GH¢’000 GH¢’000
THE GROUP
Year of assessment
Up to 2009 1,016 - - 1,016
2010-2012 4 - - 4
2013-2014 40 - - 40
2015 (15,321) - - (15,321)
2016 - 113,738 (102,862) 10,876

(14,261) 113,738 (102,862) (3,385)

National fiscal stabilization levy (2,548) 22,737 (22,807) (2,618)

(16,809) 136,475 (125,669) (6,003)

THE BANK
Year of assessment
Up to 2009 1,016 - - 1,016
2013-2014 325 - - 325
2015 (15,303) - - (15,303)
2016 - 111,064 (100,085) 10,979

(13,962) 111,064 (100,085) (2,983)

National fiscal stabilization levy (2,562) 22,219 (22,267) (2,610)

(16,524) 133,283 (122,352) (5,593)

120 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

20. DEFERRED TAX

The Group The Bank
BALANCE AT MOVEMENT BALANCE BALANCE MOVEMENT
1/1 DURING THE 31/12 1/1 DURING THE BALANCE AT
YEAR YEAR 31/12

2016 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000

Gross value
Recognised in OCI 7,783 8,927 16,710 7,783 8,927 16,710
Available for sale securities (555) 555 - (275) 275 -

At 31 December 2016 7,228 9,482 16,710 7,508 9,202 16,710

Gross value
Recognised in profit & loss
Other provisions 1,310 (1,310) - 1,310 (1,310) -
Provision for loan impairment (3,444) (7,261) (10,705) (3,444) (7,261) (10,705)
Accelerated tax depreciation (6,080) 6,876 796 (6,075) 6,880 805

At 31 December 2016 (8,214) (1,695) (9,909) (8,209) (1,691) (9,900)

Net deferred tax (asset)/liability (986) 7,787 6,801 (701) 7,511 6,810

2015
Gross value
Recognized in OCI
Revaluation of property 7,783 - 7,783 7,783 - 7,783
Available for sale securities (1,126) 571 (555) (703) 428 (275)

At 31 December 2015 6,657 571 7,228 7,080 428 7,508

Gross value
Recognized in profit & loss
Other provisions 1,423 (113) 1,310 1,403 (93) 1,310
Provision for loan impairment (9,432) 5,988 (3,444) (9,431) 5,987 (3,444)
Accelerated tax depreciation (2,317) (3,763) (6,080) (2,317) (3,758) (6,075)

At 31 December 2015 (10,326) 2,112 (8,214) (10,345) 2,136 (8,209)

Net deferred tax (asset)/liability (3,669) 2,683 (986) (3,265) 2,564 (701)

Ecobank Ghana Annual Report 2016 121

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

20. DEFFERED TAX (CONT’D)

The change on the deferred tax account was as follows:

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Profit or loss expense (1,695) 2,112 (1,691) 2,136

Other comprehensive income 9,482 571 9,202 428

21. NATIONAL FISCAL STABILISATION LEVY

The National Fiscal Stabilization Levy Act, 2013 (862) was introduced in 2013 and is effective prospectively from July 2013 with an eighteen
(18) months tenure. On 31 December 2014, Act (862) was amended by Act (882) to extend the date of expiration of the national fiscal
stabilization levy and to provide for related matters. Under the amendment Act, the levy is payable in respect of profit before tax for the
2013, 2014, 2015, 2016 and 2017 years of assessment.

Under the Act, an additional 5% levy, which is payable quarterly, is charged on profit before tax of selected entities, including Banks.

22. EARNINGS PER SHARE

Basic and diluted earnings per share is calculated by dividing the net profit attributable to equity holders of the Bank by the weighted
average number of ordinary shares in issue during the year.

122 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

22. EARNINGS PER SHARE (CONT’D)

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Profit attributable to equity holders of the Bank 327,896 321,266 325,594 327,523

Weighted average number of ordinary shares 293,228 293,228 293,228 293,228

Basic earnings per share

(expressed in Ghana pesewas per share) 112 110 111 112

Diluted earnings per share

(expressed in Ghana pesewas per share) 112 110 111 112

There is no potential dilution on basic earnings per share.

23. CASH AND BANK BALANCES

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Cash on hand 194,323 200,725 194,323 200,725

Balance with Bank of Ghana 728,309 572,217 728,309 572,217
Loan and advances to banks 2,270,570 1,450,007 2,269,234 1,448,930

3,193,202 2,222,949 3,191,866 2,221,872

Included in balance with Bank of Ghana is cash reserves maintained as part of the cash reserve requirements of the Central Bank. Cash on
hand and balances with Bank of Ghana are non-interest-bearing and will be recovered no more than 12 months after the reporting period.

Ecobank Ghana Annual Report 2016 123

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

24. LOANS AND ADVANCES TO CUSTOMERS

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Overdrafts 905,797 1,226,678 905,797 1,226,678

Staff loans 91,365 55,883 91,365 55,883
Finance leases 159,075 21,046 159,075 21,005
Mortgage loans 37,424 44,063 37,424 44,063
Term loans 2,373,448 1,929,873 2,373,070 1,928,512

Gross loans and advances to customers 3,567,109 3,277,543 3,566,731 3,276,141

Allowances for impairment (Note 15) (86,565) (159,670) (86,260) (159,392)

Net loans and advances to customers 3,480,544 3,117,873 3,480,471 3,116,749

Analysis of allowance for impairment

Loan impairment 86,565 159,670 86,565 159,392

Analysis of impairment allowance

Specific impairment 43,439 145,616 43,439 145,616
Collective impairment 43,126 14,054 42,821 13,776

86,565 159,670 86,260 159,392

Specific allowance for impairment

Balance at 1 January 145,616 27,452 145,616 27,452
Charge for the year 174,870 158,076 174,870 158,076
Amounts written off as uncollectible (161,491) (21,537) (161,491) (21,537)
Released on loan derecognized (90,211) - (90,211) -
Recoveries (25,345) (18,375) (25,345) (18,375)

Balance at 31 December 43,439 145,616 43,439 145,616

124 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

24. LOANS AND ADVANCES TO CUSTOMERS (CONT’D)

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Collective allowance for impairment

Balance at 1 January 14,054 37,960 13,776 37,724
Charge/(release) for the year 29,072 (23,906) 29,045 (23,948)

Balance at 31 December 43,126 14,054 42,821 13,776

Total allowance for impairment 86,565 159,670 86,260 159,392

Analysis by industry on gross loans

Construction 86,301 70,629 86,301 70,629
Agriculture, forestry and fishing 6,133 11,080 6,133 11,080
Mining and quarrying 88,820 85,594 88,820 85,594
Manufacturing 320,628 316,536 320,628 316,536
Electricity, gas and water 92,459 75,125 92,459 75,125
Commerce and finance 1,196,322 1,168,596 1,218,228 1,168,596
Transport, storage and communication 247,407 215,803 247,407 215,803
Services 1,529,039 1,334,180 1,506,395 1,332,778

3,567,109 3,277,543 3,566,371 3,276,141

The fifty largest exposures by customers constituted 72.18% of the gross loans at the year-end (2015: 68.40%).

The total amount of allowance for impairment represent 2.42% of the gross loans at the year-end (2015:4.87%).

The maximum amount due from staff during the year amounted to GH¢91.3million (2015: GH¢55.8million).

Ecobank Ghana Annual Report 2016 125

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

24. LOANS AND ADVANCES TO CUSTOMERS (CONT’D)

The investment in finance lease is analysed as follows:

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Less than 1 year 1,463 1,734 1,463 1,734

Between 1 year and 5 years 157,612 19,312 157,612 19,271

Gross investment in finance leases 159,075 21,046 159,075 21,005

Unearned finance income on finance leases (76) (58) (76) (59)

Net investment in finance leases 158,999 20,988 158,999 20,946

Analysis by industry on gross loans

The net investment in finance lease is analysed as follows:

Less than 1 year 1,462 3,010 1,462 3,001

Between 1 year and 5 years 157,537 17,978 157,537 17,945

158,999 20,988 158,999 20,946

126 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

25. INVESTMENT SECURITIES

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Government securities (a) 638,862 726,726 576,837 592,107

Investment securities available for sale (b) 2,148 2,148 2,148 2,148

At 31 December 641,010 728,874 578,985 594,255

(a) Government Securities

At 1 January 726,726 732,856 592,107 630,645

Additions 4,077,328 2,199,725 3,786,443 1,863,622
Redeemed on maturity (4,167,413) (2,208,140) (3,802,813) (1,903,872)
Gains from changes in fair value (Note 37) 2,221 2,285 1,100 1,712

At 31 December 638,862 726,726 576,837 592,107

Maturing within 90 days of acquisition 326,491 632,485 270,968 523,284

Maturing after 90 days but within 182 days 24,356 7,412 21,852 3,728
Maturing after 182 days of acquisition 9,124 30,837 5,667 9,300
Maturing after 1 year of acquisition 278,891 55,992 278,350 55,795

638,862 726,726 576,837 592,107

Government securities are treasury bills and bonds issued by the Government of Ghana. These are either categorised as available-for-sale
(carried at fair value) or loans and receivables carried at amortised cost.

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

(b) Investment securities available for sale

At 1 January 2,148 1,522 2,148 1,522
Additions - 626 - 626
Impairment on investment securities - - - -

At 31 December 2,148 2,148 2,148 2,148

Non-current 2,148 1,522 2,148 1,522

Ecobank Ghana Annual Report 2016 127

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

26. INVESTMENT IN SUBSIDIARIES

The Bank The Bank

Ordinary shares % 2016 2015

GH¢’000
GH¢’000

Ecobank Investment Managers Limited 100 11,350 11,350

Ecobank Leasing Company Limited 100 1,000 1,000
Ecobank Venture Capital Fund 1 Company Limited 100 10,427 4,422
Ecobank Capital Advisors Limited 100 1 1

22,778 16,773

All these subsidiaries are incorporated and domiciled in Ghana.

a. Significant restrictions

The Group does not have significant restrictions on its ability to access or use its assets and settle its liabilities.

27. OTHER ASSETS

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Fees receivable 37,325 38,793 50,093 58,794

Prepayments 30,765 27,932 30,765 26,904
Due from affiliates 56,369 163,539 56,369 163,539
Sundry receivables 217,803 104,983 217,973 104,851

342,262 335,247 355,200 354,088

Current 342,262 335,247 355,200 354,088

128 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

28. INTANGIBLE ASSETS

The Bank The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Cost
At 1 January 31,465 23,788 31,465 23,788
Additions 956 7,677 956 7,677

At 31 December 32,421 31,465 32,421 31,465

Accumulated amortisation
At 1 January 22,613 18,089 22,613 18,089
Charge for the year 4,419 4,524 4,419 4,524

At 31 December 27,032 22,613 27,032 22,613

Net book value 5,389 8,852 5,389 8,852

Intangible assets represent acquired licenses for computer software. Amortisation expense on intangible assets is included in operating
expense on the statement of comprehensive income.

29. NON-CURRENT ASSET HELD FOR SALE

(a) In 2016, management committed to a plan to sell off landed properties taken over from its creditors as part settlement of their
outstanding loan balances with the Bank. Accordingly, the total value of these landed properties is presented as non-current asset
held for sale. Efforts to sell the non-current asset have started and a sale is expected by June 2017.

(b) Assets and liabilities of non-current asset held for sale

At 31 December 2016, the non-current asset held for sale was stated at carrying amount and comprised of:

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Property and equipment 63,726 - 63,726 -

(c) Cumulative income or expense included in OCI

There is no cumulative income or expenses included in OCI relating to the non-current asset held for sale.

Ecobank Ghana Annual Report 2016 129

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)
30. PROPERTY AND EQUIPMENT
(a) Movement for the year

THE GROUP
CAPITAL
LAND & FURNITURE & MOTOR WORK IN
BUILDINGS EQUIPMENT COMPUTERS VEHICLES PROGRESS TOTAL
GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000
Gross value
At 1 January 2016 93,296 59,109 40,701 16,603 128,234 337,943
Additions - 7,167 5,214 8,630 62,073 83,094
Disposals (2,151) - (2,877) (5,028)

At 31 December 2016 91,145 66,286 45,915 22,356 190,307 416,009

Depreciation
At 1 January 2016 1,845 39,999 32,373 10,893 - 85,110
Charge for the year 1,894 6,908 4,643 3,670 - 17,115
Disposals - - - (2,877) - (2,877)

At 31 December 2016 3,739 46,907 37,016 11,686 - 99,348

Net book value

At 31 December 2016 87,406 19,379 8,899 10,670 190,307 316,661

Gross value
At 1 January 2015 93,173 47,187 35,676 13,637 15,229 204,902
Additions 123 10,994 3,995 3,951 114,963 134,026
Disposals - - - (985) - (985)
Transfers - 928 1,030 - (1,958) -

At 31 December 2015 93,296 59,109 40,701 16,603 128,234 337,943

Depreciation
At 1 January 2015 - 34,156 27,691 9,124 - 70,971
Charge for the year 1,845 5,843 4,682 2,754 - 15,124
Disposals - - - (985) - (985)

At 31 December 2015 1,845 39,999 32,373 10,893 - 85,110

Net book value

At 31 December 2015 91,451 19,110 8,328 5,710 128,234 252,833

130 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)
30. PROPERTY AND EQUIPMENT
(a) Movement for the year (cont’d)

THE BANK
CAPITAL
LAND & FURNITURE & MOTOR WORK IN
BUILDINGS EQUIPMENT COMPUTERS VEHICLES PROGRESS TOTAL
GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000
Gross value
At 1 January 2016 93,296 58,918 39,226 16,604 128,134 336,178
Additions - 7,177 5,214 8,630 62,073 83,094
Disposals (2,151) - - (2,877) - (5,028)

At 31 December 2016 91,145 66,095 44,440 22,357 190,207 414,244

Depreciation
At 1 January 2016 1,845 39,125 31,483 10,893 - 83,346
Charge for the year 1,894 6,908 4,643 3,669 - 17,114
Disposals - - - (2,877) (2,877)

At 31 December 2016 3,739 46,033 36,126 11,685 - 97,583

Net book value

At 31 December 2016 87,406 20,062 8,314 10,672 190,207 316,661

Gross value
At 1 January 2015 93,173 46,996 34,201 13,638 15,129 203,137
Additions 123 10,994 3,995 3,951 114,963 134,026
Transfers - 928 1,030 - (1,958) -
Disposals - - - (985) - (985)

At 31 December 2016 93,296 58,918 39,226 16,604 128,134 336,178

Depreciation
At 1 January 2015 - 33,297 26,801 9,124 - 69,222
Charge for the year 1,845 5,828 4,682 2,754 - 15,109
Disposals - - - (985) - (985)

At 31 December 2015 1,845 39,125 31,483 10,893 - 83,346

Net book value

At 31 December 2015 91,451 19,793 7,743 5,711 128,134 252,832

Contractual commitments for the acquisition of property and equipment not provided for in the financial statements as at 31 December 2016 was
GH¢20,325,613 (2015: GH¢62,964,994.75). The commitments are approved cost in respect of new head office projects.

Ecobank Ghana Annual Report 2016 131

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

(b) Depreciation of property and equipment

Depreciation has been charged in the financial statements as follows:

The Group The Bank
2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Operating expenses 17,115 15,124 17,114 15,109

(c) Cost component of revalued property

An analysis of the cost component of the revalued land and building was as follows:

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Cost 51,285 51,285 51,285 51,285

Accumulated depreciation (4,690) (3,408) (4,690) (3,408)

46,595 47,877 46,595 47,877

(d) Disposal of property and equipment

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Gross value 5,028 985 5,028 985

Accumulated depreciation 2,877 (985) 2,877 (985)

Net book value 2,151 - 2,151 -

Sales proceeds 2,442 184 2,442 184

Gain on disposal of property and equipment 289 184 289 184

132 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

(e) Analysis of PPE gross (Property and equipment)

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Cost 51,285 51,285 51,285 51,285

Revaluation surplus 42,011 42,011 42,011 42,011

93,296 93,296 93,296 93,296

31. DEPOSITS FROM BANKS

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Other deposits from Banks 542,856 205,123 630,288 286,934

Current 542,856 205,123 630,288 286,934

32. CUSTOMER DEPOSITS

The Group The Bank
2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Current accounts 4,064,888 3,629,846 4,085,111 3,644,771

Cash collateral 190,528 191,218 190,528 191,218
Savings account 724,425 595,016 724,425 595,016
Time deposit 321,311 236,576 316,561 233,508
Private placements 115,764 185,294 - -

5,416,916 4,837,950 5,316,625 4,664,513

Current 5,095,605 4,601,374 5,000,064 4,431,005

Non-current 321,311 236,576 316,561 233,508

5,416,916 4,837,950 5,316,625 4,664,513

The twenty largest depositors constituted 20.32% of the total deposits at the year-end (2015: 16.95%).

Ecobank Ghana Annual Report 2016 133

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

33. BORROWINGS

AT EXCHANGE AT
1/1/16 DRAWDOWN INTEREST REPAYMENT DIFFERENCES 31/12/16
GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000 GH¢’000
International Finance
Corporation 76,799 - 653 (5,206) 12,411 84,657
Export Development
Investment Fund 9,514 - 56 (4,845) - 4,725
European Investment Bank 65,264 - 729 (2,330) 8,958 72,621
Ecobank Transnational Bank
(IFC) 62,018 43,796 587 (67,358) 7,880 46,923
Ecobank Transnational Bank
(EIB) 31,807 - 901 (12,166) 3,276 23,818
African Development Bank 76,574 - - (88,741) 12,167 -

321,976 43,796 2,926 (180,646) 44,692 232,744

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Current 4,189 1,729 4,189 1,729

Non-current 228,555 320,247 228,555 320,247

232,744 321,976 232,744 321,976

A loan of US$20 million was made available to the Bank by International Finance Corporation (IFC) under an agreement dated 20 July 2007.
This loan is used as tier II capital, and attracts interest at LIBOR plus a margin of 5.5% per annum. This loan expired in June 2015 and has
been renewed for another 8 years. The loan is unsecured.

The borrowing from Export Development Fund (EDIF) was made available for the purposes of on-lending to small scale enterprises, export
insurance re-financing and credit guarantee. This is a revolving fund, which attracts interest at a rate of 2.5% per annum. The loan is
unsecured.

Borrowing totaling US$29 million from International Finance Corporation and European Investment Bank were secured through Ecobank
Transnational Incorporated. These borrowings are unsecured subordinated debts, which attract interest at 9.04% and 5.5% respectively,
and are repayable between 13 July 2018 and 1 May 2019.

African Development Fund provided the bank with an unsecured loan of US$20 million. This will be used exclusively to finance eligible
trade transactions and thereby support funding for trade of consumer goods, food commodities, petroleum products, telecom equipment,
intermediate goods, smaller machinery and commodities. The loan attracts interest at LIBOR plus a margin of 3.44% per annum. This loan
is repayable by 18 April 2018. The loan is unsecured.

134 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

34. OTHER LIABILITIES

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Collections on behalf of customers 623,083 303,730 623,083 303,730

Bankers drafts and managers cheques 25,223 20,471 25,223 20,471
Point of sale terminals 4,888 2,484 4,888 2,484
Accruals 107,610 44,454 107,422 43,932
Payables & sundry liabilities 132,673 65,869 126,219 62,419

893,477 437,008 886,835 433,036

Current 314,429 395,796 312,092 407,362

Non-current 579,049 41,212 574,743 25,674

893,477 437,008 886,835 433,036

35. STATED CAPITAL

No. of shares Proceeds

2016 2015 2016 2015
GH¢’000
GH¢’000

Bank
Authorised:
Ordinary shares of no par value 500,000,000 500,000,000

Issued and fully paid

Ordinary shares of no par value 293,228,372 293,228,372

Issued ordinary shares comprise:

Issued for cash 88,692 88,692
Issued for consideration other than cash 137,949 137,949

At 31 December 226,641 226,641

There is no unpaid liability and no call or instalment unpaid on any share. There is no share in treasury.

Ecobank Ghana Annual Report 2016 135

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

36. INCOME SURPLUS

The Group The Bank
2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

At 1 January 273,852 264,393 263,775 249,030

Profit for the year 327,896 321,266 325,594 327,523
Dividend paid relating to prior year (246,312) (231,650) (246,312) (231,650)
Transfer to statutory banking reserve (Note 39) (40,712) (40,969) (40,700) (40,940)
Transfer to regulatory credit risk reserve (Note 40) (42,279) (40,188) (42,279) (40,188)

At 31 December 271,445 272,852 260,078 263,775

37. REVALUATION RESERVE

(a) Capital surplus – land and building revaluation
The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

At 1 January 59,056 59,056 59,056 59,056

Deferred tax (Note 20) (8,927) - (8,927) -

At 31 December 50,129 59,056 50,129 59,056

(b) Available for sale instruments

At 1 January (1,666) (3,380) (825) (2,109)

Net gain from changes in fair value
government securities (Note 25) - 2,285 - 1,712
Realised gain on securities disposed off (Note 25) 2,221 - 1,100 -
Deferred income taxes (Note 20) (555) (571) (275) (428)

At 31 December - (1,666) - (825)

Total revaluation reserves 50,129 57,390 50,129 58,231

136 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

38. CASH AND CASH EQUIVALENTS

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Cash balances (Note 23) 194,323 200,725 194,323 200,725

Government securities (Note 25) 326,491 632,485 270,968 523,284
Due from other Banks (Note 23) 2,270,570 1,450,007 2,269,234 1,448,930
Deposits from Banks (Note 31) (542,856) (205,123) (630,288) (286,934)

As shown in the statement of cash flows 2,248,528 2,078,094 2,104,237 1,886,005

Cash and cash equivalents comprise balances with less than three months maturity from the date of acquisition, including cash on hand,
deposits held at call with banks and other short term highly liquid investments with original maturities of three months or less.

39. STATUTORY RESERVE

Statutory reserve represents cumulative amounts set aside from annual profits after tax required under the Banking Act for Banks and the
Non-Bank Financial Institutions Business Rules for leasing companies.

The proportion of net profits transferred to reserves ranges from 12.5% to 50% of net profit after tax, depending on the ratio of the balance
on statutory reserves to paid up capital.

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

At 1 January 282,412 241,443 281,923 240,983

Transfer from income surplus 40,712 40,969 40,700 40,940

At 31 December 323,124 282,412 322,623 281,923

Ecobank Ghana Annual Report 2016 137

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

40. CREDIT RISK RESERVE

Regulatory credit risk reserve represents cumulative amounts required to meet the Bank of Ghana prudential guidelines for allowances
on impairment.

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

At 1 January 50,458 10,270 50,458 10,270

Transfer from income surplus 42,279 40,188 42,279 40,188

At 31 December 92,737 50,458 92,737 50,458

41. INVESTMENT IN ASSOCIATE

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

At 1 January 7,387 6,539 4,841 4,841

Share of associate profit 686 848 - -

At 31 December 8,073 7,387 4,841 4,841

The Bank has one associate; Pan African Savings and Loans Company Limited, whose results are incorporated into this financial statements
using equity accounting.

Pan African Savings and Loans Company Limited

Strategic investment which provides microfinance to small and

The relationship with the Bank medium scale enterprises.

Principal place of business/country of incorporation Accra, Ghana

Ownership interest/voting rights of the Bank 49% (2015: 49%)

Fair value of ownership interest (if listed) N/A

138 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

41. INVESTMENT IN ASSOCIATE (CONT’D)

Financial statements extract of associates

2016 2015
GH¢’000 GH¢’000

Revenue 24,128 22,712

Profit from continuing operations 884 1,559

Other comprehensive income - -

Total comprehensive income 884 1,559

Attributable to investee’s shareholders 884 1,559

Total assets 55,382 52,812

Total liabilities 44,726 42,847

Net assets 10,656 9,965

Attributable to investee’s shareholders 5,221 4,883

Group’s interest in net assets at 1 January 7,387 6,539

Total comprehensive income to the Group 686 848
Dividends received during the year - -

Group’s interest at 31 December 8,073 7,387

Ecobank Ghana Annual Report 2016 139

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

42. CONTINGENT LIABILITIES AND COMMITMENTS

Off balance sheet items

In common with other banks, the bank conducts business involving acceptances, performance bonds and indemnities. The majority
of these facilities are offset by corresponding obligations of third parties. In addition, there are other derivative instruments, including
forwards and option contracts or combinations thereof (all commonly known as derivatives), the nominal amounts of which are not
reflected in the consolidated balance sheet.

Nature of instruments

An acceptance is an undertaking by a bank to pay a bill of exchange drawn on a customer. The Bank expects most acceptances to be
presented, but reimbursement by the customer is normally immediate.

Other contingent liabilities include transaction related customs and performance bonds, which are generally short-term commitments to
third parties that are not directly dependent on the customer’s creditworthiness.

Commitments to lend are agreements to lend to a customer in the future, subject to certain conditions. Such commitments are either
made for a fixed period, or have specific maturity dates but are cancellable by the lender subject to notice requirements. Documentary
credits commit the Bank to make payments to third parties, on production of documents, which are usually reimbursed immediately by
customers.

The following, summarise the nominal principal amount of contingent liabilities and commitments with off-balance sheet risks.

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Contingent liabilities

Guarantees and indemnities 397,413 265,905 397,413 265,905

Documentary and commercial letters of credit 213,842 334,870 213,842 334,870

611,255 600,775 611,255 600,775

Legal proceedings

There were a number of legal proceedings outstanding against the Group at 31 December 2016. Although liabilities is not admitted, if
defense against the legal action is unsuccessful, potential liabilities estimated at GH¢16,406,388.49 would be payable.

140 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

43. RELATED PARTY TRANSACTIONS

a. Transactions with executive directors and key management personnel

Key management personnel are defined as those persons having authority and responsibility for planning, directing and controlling the
activities of Ecobank Ghana Limited (directly or indirectly) and comprise the Executive Directors and Senior Management of Ecobank Ghana
Limited.

There were no material related party transactions with companies where a Director or other member of key management personnel (or any
connected person) is also a Director or other member key management personnel (or any connected person) of Ecobank Ghana Limited.

No impairment losses have been recorded in respect of loans to Directors or other members of key management personnel (or any
connected person).

Details of transactions between Directors and other key management personnel (and their connected persons) and the Group are as
follows:

2016 2015
GH¢’000 GH¢’000

Loans
Loan outstanding at 1 January 7,269 3,094
Net movement 2,934 4,175

Loans outstanding at 31 December 10,203 7,269

Interest income 763 586

There were no loans given to non-executive Directors.

Deposits at 1 January 2,420 1,026

Net movement during the year 661 1,394

Deposits at 31 December 3,081 2,420

Interest expense 186 170

Ecobank Ghana Annual Report 2016 141

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

43. RELATED PARTY TRANSACTIONS (CONT’D)

Loans to Executive Directors and key management personnel include housing, car and other personal loans which are given under terms
that are no more favorable than those given to other staff. No impairment has been recognized in respect of loans granted to Executive
Directors and key management personnel at 31 December 2016 and 2015. The housing and car loans are secured by the underlying assets.
All other loans are unsecured.

b. Transactions with non-executive directors

No loans were advanced to non-executive Directors during the year. There were no balances outstanding on account of loans due from
non-executive Directors at the year end.

c. Transactions and balances with subsidiaries

The Bank has 100% shareholdings in four (4) Subsidiaries (refer to page 4). Fixed deposit investments are placed with the subsidiaries. The
subsidiaries current accounts are held with the Bank. Interest accrues on these placements at normal commercial rates.

Balances due to/from the subsidiary at the year-end were as follows:

2016 2015
GH¢’000 GH¢’000

Placement with subsidiary 113,029 90,250

Deposits with subsidiary 118,962 187,100
Interest income from placements 27,000 13,016
Interest income on deposits 12,001 16,839

142 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

43. RELATED PARTY TRANSACTIONS (CONT’D)

d. Transactions and balances with parent company

The Bank is a subsidiary of Ecobank Transnational Incorporated (ETI), a company incorporated in the Republic of Togo.

A number of transactions were entered into with the parent company in the normal course of business. These transactions include loans,
placements, deposits, foreign currency and other operational transactions. These transactions were carried out on commercial terms and
at commercial market rates and went through the normal channels of approval.

Transactions during the year and balances at 31 December are as follows:

2016 2015
GH¢’000 GH¢’000

Placements with related parties (foreign) 178,123 68,997

Borrowings 70,705 170,627
Interest income from placements 20,082 1,053

e. Transactions and balances with subsidiaries of the parent company (ETI)

A number of transactions were entered into with other subsidiaries of the parent company (Ecobank Transnational Incorporated) in the
normal course of business. These transactions include loans, placements, deposits, foreign currency and other operational transactions.
These transactions were carried out on commercial terms and at commercial market rates and went through the normal channels of
approval.

2016 2015
GH¢’000 GH¢’000

Placements 855,090 216,726

Other assets 72 50
Interest income from placements 32,726 2,254

Ecobank Ghana Annual Report 2016 143

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

44. REGULATORY DISCLOSURES

(i) Non-performing loans ratio

The percentage of gross non-performing loans (“substandard to loss”) to total credit/advances portfolio (gross) was 11.90% (2015: 16.56%)
per Bank of Ghana’s prudential guidelines. As per IFRS, the Bank recorded NPL 15.87% (2015: 18.01%)

(ii) Capital adequacy ratio

The capital adequacy ratio at the end of December 2016 was calculated as stated below:

The Group - 15.29% (2015: 17.78%)

The Bank - 14.74% (2015: 17.13%)

(iii) Compliance with statutory liquidity requirement

(a) Default in Statutory Liquidity-None

(b) Default in Statutory Liquidity- Sanction (GH¢ Nil)

(iv) Liquid ratio

The Group 76.39% (2015: 74.46%)

The Bank 73.44% (2015: 69.86%)

45. BUSINESS SEGMENTS

The Group has three main business segments:

As at the end of the year 2016, the Bank operated the following business units:

(a) Consumer Banking - This is personal banking and specializes in serving the Premier, Advantage, Classic and Direct customers

(b) Commercial Banking - This is Business Banking and Medium Local Corporates with the following sub-segments SMEs, Medium Local
corporates and Non-government public sector (schools, faith, NGOs & professional bodies)

(b) Corporate Banking - Specialises in serving the public sector, multinational institutions, financial institutions/international organizations
and the Regional Corporate segment of the market.

The Business Units of the Bank has been re-structured along the above lines effective 1 January 2016

Transactions between business segments are on normal commercial terms and conditions. Funds are ordinarily allocated between
segments, resulting in funding cost transfers disclosed in operating income. Interest charged for these funds is based on the Group’s cost
of capital.

The Group’s operations are based in Ghana. There are no separately distinguishable geographical segments.

144 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

45. BUSINESS SEGMENTS (CONT’D)

The segmental information provided to the Board for reportable segments for the year ended 31 December is as follows:

CONSUMER COMMERCIAL CORPORATE GROUP

THE GROUP GH¢’000 GH¢’000 GH¢’000 GH¢’000

At 31 December 2016
Net interest income 279,885 177,449 261,771 719,105
Net fees and commission income 39,329 21,775 96,118 157,222
Net trading income 24,034 22,545 83,695 130,274
Other operating income 6,706 6,275 5,081 18,062
Other revenue - - 4,140 4,140
Gains from derecognition of financial
assets measured at amortised cost - - 177,854 177,854

Revenue 349,954 228,044 628,659 1,206,657

Other income - - 291 291
Loan impairment loss (5,531) (24,579) (148,487) (178,597)

Net operating income 344,423 203,465 480,463 1,028,351

Personnel expenses 111,450 80,589 124,320 316,359

Depreciation and amortization 5,620 3,981 11,933 21,534
Other operating expense 79,605 56,496 92,367 228,468

Operating profit 147,748 62,399 251,843 461,990

Share of profit of associate (net of tax) - - 686 686

Profit before income tax 147,748 62,399 252,529 462,676

Tax expense (43,040) (18,177) (73,563) (134,780)

Profit for the year 104,708 44,222 178,966 327,896

Segment assets 928,565 623,790 6,504,514 8,056,870

Segment liabilities 2,191,009 1,720,708 3,181,076 7,092,794

Ecobank Ghana Annual Report 2016 145

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

45. BUSINESS SEGMENTS (CONT’D)

CONSUMER COMMERCIAL CORPORATE GROUP

THE GROUP GH¢’000 GH¢’000 GH¢’000 GH¢’000

At 31 December 2015
Net interest income 175,163 97,374 409,704 682,241
Net fees and commission income 73,112 32,344 79,906 185,362
Net trading income 29,756 29,300 79,801 138,857
Other operating income 1,071 1,969 10,142 13,182
Other revenue - - 3,487 3,487

Revenue 279,102 160,987 583,040 1,023,129

Other income - - 184 184
Loan impairment loss (2,844) (4,982) (107,969) (115,795)

Net operating income 276,259 156,004 475,255 907,518

Personnel expenses 110,506 43,878 91,740 246,124

Depreciation and amortization 8,799 3,494 7,355 19,648
Other operating expense 57,544 22,848 103,642 184,034

Operating profit 99,410 85,784 272,518 457,712

Share of profit of associate (net of tax) - - 848 848

Profit before income tax 99,410 85,784 273,366 458,560

Tax expense (29,764) (25,684) (81,846) (137,294)

Profit for the year 69,646 60,100 191,520 321,266

Segment assets 2,427,870 690,003 3,573,937 6,691,810

Segment liabilities 1,925,145 2,912,805 964,107 5,802,057

146 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

45. BUSINESS SEGMENTS (CONT’D)

CONSUMER COMMERCIAL CORPORATE GROUP

THE BANK GH¢’000 GH¢’000 GH¢’000 GH¢’000

At 31 December 2016
Net interest income 279,885 177,449 244,143 701,477
Net fees and commission income 39,329 21,775 96,166 157,270
Net trading income 24,034 22,545 83,355 129,934
Other operating income 6,706 6,275 4,710 17,691
Other revenue - - 16,942 16,942
Gains from derecognition of financial
assets measured at amortised cost - - 177,854 177,854

Revenue 349,954 228,044 623,170 1,201,168

Other income - - 291 291
Loan impairment loss (5,531) (24,579) (148,460) (178,570)

Net operating income 344,423 203,465 475,001 1,022,889

Personnel expenses 111,450 80,589 123,954 315,993

Depreciation and amortization 5,620 3,981 11,932 21,533
Other operating expense 79,605 56,496 92,076 228,177

Operating profit 147,748 62,399 247,039 457,186

Profit before income tax 147,748 62,399 247,039 457,186

Tax expense (42,526) (17,960) (71,106) (131,592)

Profit for the year 105,222 44,439 175,933 325,594

Segment assets 928,565 623,790 6,473,155 8,025,510

Segment liabilities 2,191,009 1,720,708 3,161,585 7,073,302

Ecobank Ghana Annual Report 2016 147

 Financials

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED

31 DECEMBER 2016 (CONT’D)

45. BUSINESS SEGMENT (CONT’D)

CONSUMER COMMERCIAL CORPORATE GROUP

THE BANK GH¢’000 GH¢’000 GH¢’000 GH¢’000
At 31 December 2015

Net interest income 175,163 97,374 392,895 665,432

Net fees and commission income 73,122 32,344 79,904 185,370
Net trading income 29,756 29,300 79,295 138,351
Other operating income 1,071 1,969 10,134 13,174
Other revenue - - 23,438 23,438

Revenue 279,112 160,987 585,666 1,025,765

Other income - - 184 184
Loan impairment loss (2,844) (4,982) (107,927) (115,753)

Net operating income 276,268 156,005 477,923 910,196

Personnel expenses 110,506 43,878 91,412 245,796

Depreciation and amortization 8,799 3,494 7,340 19,633
Other operating expense 57,544 22,848 103,296 183,688

Operating profit 99,419 85,785 275,875 461,079

Profit before income tax 99,419 85,785 275,875 461,079

Tax expense (28,798) (24,848) (79,910) (133,556)

Profit for the year 70,621 60,937 195,965 327,523

Segment assets 2,426,746 690,003 3,470,738 6,587,487

Segment liabilities 1,751,708 2,912,805 1,041,946 5,706,459

148 Ecobank Ghana Annual Report 2016

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED
31 DECEMBER 2016 (CONT’D)

46. DIVIDEND PER SHARE

At the forthcoming meeting, dividend of 82 Ghana pesewas (2015:84 Ghana pesewas) per share is to be proposed amounting to a total of
GH¢240,447,265.04 (2015: GH¢246,311,832.48).

47. CORPORATE SOCIAL RESPONSIBILITY

Ecobank recognises the role the communities play in ensuring the Bank remains in business. Giving back to these communities is a core
objective for the Bank at both the corporate and individual levels. During the year, the Bank continued with its corporate social responsibility
(CRS) programs with a key focus on education, health, financial inclusion and others. A total of GH¢3.38 million was committed to CSR
activities this year representing an increase of 19% in the figure for last year of GH¢2.84 million.

Ecobank Ghana Annual Report 2016 149

 Financials

FIVE YEAR FINANCIAL SUMMARY

(All amounts are expressed in thousands of Ghana Cedis)

Number of Shareholders

The Bank had 13,705 ordinary shareholders at 31 December 2016 distributed as follows:

2016 2015 2014 2013 2012

Income Statement
Revenue 1,206,657 1,023,129 857,737 589,603 422,717
Profit before tax 462,676 458,560 446,941 267,874 186,226
Profit after tax 327,896 321,266 319,965 190,633 132,557
Dividend 240,447 246,312 231,650 126,088 85,036

Statement of Financial Position

Loans and advances to customers 3,480,544 3,117,873 2,709,517 2,126,820 1,396,514
Customer deposits 5,416,916 4,837,950 4,234,434 3,246,674 2,464,605
Total assets 8,056,870 6,691,810 5,767,608 4,694,261 3,428,070
Shareholder equity 964,076 889,753 798,423 560,929 456,212

Statistics
Dividend per share in pesewas 82 84 79 43 34
Earnings per share in pesewas 112 110 109 65 45
ROAE (%) 35 38 47 37 37
ROAA (%) 4.4 5.2 6.1 4.7 4.8

150 Ecobank Ghana Annual Report 2016

Financials

VALUE ADDED STATEMENT

Value added statements for the year ended 31 December 2016

The Group The Bank

2016 2015
GH¢’000
2016 2015
GH¢’000
GH¢’000 GH¢’000

Interest earned and other operating income 915,021 695,423 897,022 678,606

Direct cost of services (227,468) (184,034) (228,177) (182,688)

Value added by banking services 687,553 511,389 668,845 495,918

Non-banking income 292,613 328,738 304,437 347,343

Impairments (178,597) (115,795) (178,570) (115,753)

Value Added 801,569 725,332 795,712 727,508

Distributed as follows:
To employees:
Directors (without executives) 1,000 1,000 1,000 1,000
Executive directors 12,560 5,387 12,560 5,387
Other employees 303,799 240,737 303,433 240,409

To government:
Income tax 134,780 137,294 131,592 133,556

To providers of capital:
Dividends to shareholders 240,447 246,312 240,447 246,312

To expansion and growth:

Depreciation 17,115 15,124 17,114 15,109
Amortisation 4,419 4,524 4,419 4,524

Retained earnings 87,449 74,954 85,147 81,211

Ecobank Ghana Annual Report 2016 151

 Appendix I

SHAREHOLDERS’ INFORMATION

Number of Shareholders

The Bank had 13,705 ordinary shareholders at 31 December 2016 distributed as follows:

2016 2015

No. of % of shares No. of % of shares

holders held holders held

Category
1-1,000 12,280 1.15 12,290 1.16
1,001-5,000 1,087 0.70 1,104 0.71
5,001-10,000 167 0.39 176 0.41
10,000 and over 171 97,76 176 97.72

Total 13,705 100,00 13,746 100.00

Directors’ Shareholding

The Directors named below held the following number of shares in the Bank at 31 December 2016:

No. of shares % of Holding

Terence Ronald Darko 80,000 0.027

Daniel Kwei-Kuma Sackey 1,615 0.001
Samuel Ashitey Adjei 41,260 0.014
Martin Eson-Benjamin 2,590 0.001
Rosemary Yeboah 758 0.000
Morgan Fianko Asiedu 2,025 0.001

Total 128,248 0.044

152 Ecobank Ghana Annual Report 2016

Appendix I (cont’d)

SHAREHOLDERS’ INFORMATION

20 Largest Shareholders

No. of shares % of Holding

Ecobank Transnational Incorporated 202,129,934 68.93

Social Security and National Insurance Trust 47,519,681 16.19
SCGN/SSB & T AS Custodian Re SQM Frontier Africa Masters 8,294,445 2.86
Compagnie Africaine de Financement et de Participation-Holing 6,897,425 2.35
African Tiger Mutual Fund 4,407,075 1.50
Ghana Reinsurance Company Limited General Business 3,901,190 1.33
Teachers Fund 1,818,738 0.62
Verdipapirfondet Holberg Rurik Scgn/Citibank London 949,400 0.32
SCGN/Citibank London Verdipapirfondet Holberg Global 832,700 0.28
SCGN/Standchart Mauritius Re Pinebridge Sub-Saharan Africa Equity 478,500 0.16
SCGN/JP Morgan Chase Duet Victoire Africa Index Fund IC 426,428 0.15
SCGN/ELAC Policyholders Fund 410,442 0.14
Cocobod End of Service Benefit Scheme 355,098 0.12
SCGN/DZ/Privatebank S.A Re Silk-African Lions Fund 320,000 0.11
SCGN/Northern Trust Co. AVFC 6314B 292,700 0.10
Opoku-Gyamfi Boateng 248,000 0.08
SCGN/DZ Privatebank S.A Re Silk-Road Frontiers Fund 235,500 0.08
SIC Insurance Company Limited 232,603 0.08
SCGN/Verdipapirfondet Holdberg - Rurik 227,500 0.08
SCGN/CACEIS Bank Lux Re Interffekt Investment Funds N.V 224,600 0.08

280,250,932 95.57

Ecobank Ghana Annual Report 2016 153

 Proxy Form

I/WE, being a Member(s) of the above-named Company hereby

appoint

or failing him/her the Chairman of the Meeting as my/our Proxy to vote on my/our behalf

at the Annual General Meeting (AGM) of the Company to be held on Friday , May 5, 2017 at 10:30 am prompt.

DATED THE DAY OF , 2017.

MEMBER

This Form is to be used in favour of/against the Resolution set out in the Agenda. FOR AGAINST

1. TO ADOPT ACCOUNTS

2. TO DECLARE a Dividend

3. TO RATIFY the appointment of the following Director

MR. DANIEL NII KWEI- KUMAH SACKEY

4. TO RATIFY the appointment of the following Director

for a 3 year term

MR. EDWARD NARTEY BOTCHWAY

5. To authorise the Directors to fix the remuneration of the Auditor

6. TO FIX REMUNERATION of the Directors

Please indicate with an “X” in the spaces above how you wish your vote to be cast. Unless otherwise instructed, the Proxy will vote as he thinks
fit.

If executed by a body corporate, this Proxy Form should be completed by the signature of a duly authorized Officer and should be accompanied
by a resolution in accordance with Section 165 of the Companies Act, 1963 (Act 179).

To be valid, this Proxy Form must be filled up, signed and lodged (together with any authority under which it is signed) with the Registrars at
Ghana Commercial Bank, Registrars Office, Thorpe Road, High Street, Accra not later than 3.00pm on Thursday, the 4th day of May, 2017.

154 Ecobank Ghana Annual Report 2016

Draft Resolutions

Draft Resolutions of 12th Annual General Meeting

of Ecobank Ghana Limited

Ordinary Resolutions

1. The General Meeting hereby adopts the Statement of Accounts of the company for the year ended the 31st day of December, 2016
together with the reports of the Directors and auditors thereon.

2. The General Meeting hereby approves the payment of dividend of GH¢0.82 per share and totalling GH¢240,447,265.04 on the 26th
day of May, 2017 to members listed on the share register as of 21st April, 2017.

3. The General Meeting hereby ratifies the appointment of Mr. Daniel Nii Kwei-Kumah Sackey as a Director.

4. The General Meeting hereby ratifies the appointment of Mr. Edward Nartey Botchway as a Director for a 3 year term

5. The General Meeting hereby authorises the Directors to fix the remuneration of the Auditors.

6. The General Meeting hereby approves payment of remuneration not exceeding the sum of GH¢1.4m per annum to the Directors.

Ecobank Ghana Annual Report 2016 155

34.

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40.
 Design lead
rtwork size: Flat 297 x 429mm
sign-off:
PM sign-off: Client sign-off:
intout size %: 100 %

olours
CMYK
MYK / SPOT:

Ecobank Ghana Ltd

19 Seventh Avenue
Ridge West – Accra
Ghana
ecobank.com