ETI discontinues merger talks with First Bank

By Omoh Gabriel
Ecobank Transnational Incorporated (ETI) says it has discontinued talks on the planned merger with First Bank Nigeria Plc due to differences in business mission and vision.
The Chairman of ETI, Mr. Mande Sidibe, told shareholders of the bank’s 19th annual general meeting of the bank in Cotonou, Benin Republic, that the merger failed because both parties accepted that the business combination would be very difficult to manage.
Sidibe said that the collapse of the more than 18 months merger discussions was due to the realisation that the merger would negate international outlook of ETI.
According to him, the plan to discontinue with the merger talks was a consensus agreement by both banks.
“There was no hard feelings, but we noticed that ETI and First Bank are working at cross purposes of the aim and objectives of the founding fathers of the banks,‚Äô‚Äô Sidibe said.
The Chairman told the shareholders that the failure of the merger was not the end of the bank’s expansion programme in Nigeria, adding that that the bank had started shopping for new banks to acquire in Nigeria. He also said that ETI was a success African story with presence in 18 countries in the continent with plans to cover all the regions in the near feature through the acquisition of banks.
According to him, the bank in the next few weeks, will expand its African presence to Sao Tome and Principe, having obtained a license to operate in the country. “We have obtained an operating license in Sao Tome and Principe and we will begin business in the country very soon. The operation will raise the number of our presence in the continent to 18 and that makes us one of the banks with the widest spread in Africa ,” he stated. He also said that Ecobank was still the bank with the highest investment in West Africa with an average of $400 million investment in the sub-region.
He said that the bank was also the most committed to the development of the sub-region, being the single bank with the highest presence in West and Central Africa . According to him, Ecobank is embarking on some restructuring to meet the challenges posed by some Nigerian banks and other foreign banks from different parts of the world that are now interested in the African market.
He disclosed that the bank’s restructuring would cover retail banking where it had
concluded plans to partner with an Indian firm. Sidibe said that the recent decision by the bank to raise $300 million from the capital market was part of its effort to hit the $1.2 billion capital target. He said that the increased capital base was for the bank’s expansion within the continent and its expansion to other countries in Africa, where the bank is not yet providing services.
Meanwhile, ETI in 2006 offered its shareholders a dividend of three cents (about N3.50) from two cents paid out in 2005. The bank’s result for the year ended Dec. 31, 2006, its gross income appreciated by 47 per cent to 348.46 million dollars compared with 236.35 million dollars achieved in 2005. The profit after tax also grew by 70 per cent to 86.37 million dollars, up from 50.94 million dollars recorded in the proceding year.