Ecobank shops for M’Mbijiwe, Nyaoga replacement, pending their confirmation

Ecobank Transnational Incorporated (ETI) is pondering the next move following the appointment of its non-executive director Sheila M'Mbijiwe as Central Bank of Kenya's (CBK) deputy governor.

Also expected to step down is Ecobank Kenya Chairman Mohammed Nyaoga. Mr Nyaoga is likely to be confirmed as CBK Chairman, following his approval by Parliament. Nyaoga was appointed Ecobank Kenya chairman in July, 2014. "I will have to resign from my position as chairman of the Ecobank Kenya board once my appointment at CBK is formalised and confirmed," said Nyaoga.

He made the remarks on the sidelines of 27th ETI Annual General Meeting that took place in Dar Es Salaam, Tanzania on Friday last week. "We take issues of corporate governance seriously and therefore the board will have to find replacements for both these officers once their appointments at CBK have been confirmed," said ETI Board Chairman Emmanuel Ikazoboh.

Ms M'Mbijiwe's was appointed ETI non–executive director last year for a term of three years. ETI acquired 75 per cent of East African Building Society (EABS) in 2008, and changed its name to Ecobank Kenya Ltd. ETI subsequently increased its shareholding in the bank to 95.67 per cent as at July 3, 2013.

It has since bought out the remaining minority shareholders and now has 100 per cent ownership of the Kenyan subsidiary. "The Kenya subsidiary, which we bought from EABS Society, has largely a cleaner balance sheet than what we found," said Ecobank Group Chief Executive Albert Essien.

"We have since expanded the network to 28 branches and although there are pending cases in court concerning some unrecovered debts, the bank is now better than what we took over."

ETI has injected more capital into the Kenyan operation, the latest being $ 100 million (Sh9.7 billion) out of which some $ 50 million (Sh4.5 billion) has already been disbursed.

In 2014, ETI injected an additional $ 25 million (Sh2.42 billion) to strengthen management of Ecobank Kenya. "It will time some time before the small subsidiaries in East Africa, Kenya included, fully mature. All I can say is that we are finally turning the corner in this region. Kenya is a very competitive and efficient market and this means one cannot expect to go in and immediately make money," Essien told The Standard last week.

Last year, Ecobank Group made a pre-tax profit of $519.5 million (Sh50 billion). Its net profit stood at $ 394.8 million (Sh38.3 billion) with no cash dividend recommended for 2014, a development that caused an uproar among shareholders at the AGM in Dar es Salaam.