Ecobank gets $75m tier-1 capital injection from Arise B.V to optimize ETI’s capital buffers
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Ecobank has received an investment worth $75 million tier-1 investment from Arise B.V, one of the leading equity investors into sub-Saharan financial institutions, demonstrating its support to Ecobank as a major institutional shareholder in Ecobank Transnational Incorporated (ETI). The investment is aimed to boost the bank’s tier-1 capital by $75 million.
Ecobank in a statement said the Basel III compliant instrument is the first AT1 instrument issued by ETI and a landmark transaction in the sub-Saharan Africa region and the investment demonstrates the support, commitment and capacity of Ecobank’s international shareholder base.
Meanwhile, the AT1 investment comes after ETI’s epic $350 million subordinated Eurobond, which was issued in June 2021, qualifying as a tier-2 capital listed on the London Stock Exchange, and which was well received by international investors across several continents.
Commenting on the additional investment by Arise B.V, Ade Ayeyemi, group chief executive officer of ETI, said: “This investment by Arise is a testament to continued support and confidence from our shareholders; their commitment to, and belief in our strategy which we remain focused on executing to deliver value to our shareholders and excellence to our customers. Indeed, in addition to improving our double leverage ratio, it is also a good boost for the firm and its staff”.
The banking group CEO further revealed that the additional investment will be channeled into the financial institution for its general corporate purposes, including loan growth and strengthening of its capital buffers of profitable subsidiaries in two of its cornerstone regions of the Francophone and the Anglophone West Africa regions respectively.
“The investment will optimize and improve ETI’s Tier 1 capital by $75 million,” he added.
Also, Deepak Malik, who is the chief executive officer of Arise B.V stated: “ETI is our primary banking investment in Francophone West Africa and Anglophone West Africa. We are very supportive of ETI’s growth ambitions and its ability to increase financial services to Agriculture, SMEs & retail customers. Our investment will also strengthen the balance sheet of ETI and provide additional risk capital.”