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Samuel_Adjei_AshitteyEcobank Ghana Limited planned to capture and stay top of the Ghanaian banking industry after it had successfully acquired The Trust Bank (TTB).

At the moment, Ecobank hold a total assets of GH¢2.2billion, emerging as the second-biggest bank after the Ghana Commercial Bank by the end of the third quarter of 2011. It also posted a profit before tax of GH¢79million, becoming the second-most profitable bank after the Standard Chartered Bank, Ghana.

Ecobank Ghana, for the past five years, has achieved a cumulative average growth rate of 31 per cent in its profit before tax, while its total assets have been growing by 29 per cent – with customer loans and deposits growing by 25 and 27 per cent respectively.
Managing Director of the bank, Mr Samuel Ashittey Adjei, justified the acquisition of TTB as purely a business decision that could provide the needed synergies in the banking sector.

At a media interaction in Accra, Mr Adjei said the synergies would potentially position Ecobank to become the biggest in terms of assets and the most profitable bank in the country. He said, “We shall have synergies in the value chain. We shall see a massive deployment of loans. Our loan to deposit ratio will increase dramatically”.

“In all the 33 countries where Ecobank operates, our aim is to remain among the top-three banks in all the measurements and in all the ratios -- so after we had achieved that in Ghana after 15 years of operations, we then decided to focus on becoming the first, both in assets and in profitability.

“We realised to achieve that, we needed to grow organically by extending our reach with more branches – or acquiring a bank that could provide the necessary synergies. We, therefore, decided to acquire a bank, and TTB became the natural choice because of its special positioning in the market.

“We were very strong in corporate and retail banking, but we were not strong in the SMEs and the local corporate segment of the market. It became obvious to us that TTB would be the best to fit into that gap because it performed well in the SMEs and the local corporate segment”.

Ecobank holds a capital of US$225 million while TTB hold US$160 million. The combined capital of the two banks after the acquisition will stand at US$ 225million. The enlarged business would now have the highest single obligor limit in the industry, which allows for increased lending.

Mr Ashittey Adjei also assured staff of the TTB that no staff of the bank would be laid-off after the acquisition of the bank.

“Before the acquisition, we took a business decision not to lay-off any staff of TTB, and decided that in a situation where there is duplicity of duties, we shall create different roles – which will mean that everybody will play a part in the enlarged business.

“We decided every single member of staff, from the top to the bottom, will be maintained. We shall ensure that we put people in the right positions”.

He explained that there was a human-resource committee comprising staff of the two banks, working together to address concerns of every member of staff. “We have received fantastic co-operation from the two institutions. We are extremely pleased with the level of support we have received from the TTB staff.”

In December last year, Ecobank Transnational Incorporated (ETI), the parent company of Ecobank Ghana, acquired a 100 per cent share in TTB in a deal estimated at about US$135million. The merger promised to make the enlarged business, Ghana’s biggest bank in terms of assets and profitability.

Source;graphic.com

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