Renee Bonorchis
ECOBANK Transnational’s board was due to meet yesterday in Ghana after the lender was ordered to pay compensation to its former chief executive Thierry Tanoh by courts in Ivory Coast and Togo.
Shareholders, including South Africa’s biggest pension fund administrator, the Public Investment Corporation, Nedbank and Qatar National Bank(QNB), may discuss moving Ecobank’s headquarters from Togo, according to Martial Akakpo, a lawyer for Ecobank based in the capital, Lome.
“Since this judicial pressure has started, this idea has circulated at Ecobank. This idea is not new. It is not excluded that this idea comes back on the table,” Akakpo said.
Ecobank called a special board meeting after Tanoh won defamation cases against the lender in Ivory Coast and Togo for wrongful dismissal.
The bank, ordered to pay Tanoh about 13.2 billion CFA francs (R265.7bn), is appealing the judgments.
Ecobank spokesman Richard Uku confirmed yesterday’s meeting in the Ghanaian capital, Accra, without saying what will be discussed.
Ecobank has been battling Tanoh since 2013 after regulators investigated allegations of management fraud and poor governance.
“We believe the governance issues have been tackled and the bank has been working on strengthening its governance,” Leen Antonios, a Beirut-based analyst at Arqaam Capital said this week.
‘Well connected’
Tanoh, who is deputy general secretary in the office of Ivorian President Alassane Ouattara, a post that has the status of minister, “is very well connected in Ivory Coast and Togo too, it would seem”, Brian Mugabe, an analyst at Imara SP Reid, said.
“Tanoh is a blip. I would assume that the risks will diminish once the Tanoh issue is done.”
The International Monetary Fund said in a report last week that Ecobank, the most geographically diverse lender in Africa, had expanded very rapidly and that its biggest unit, the Nigerian operations, had been plagued by “poor governance, questionable transactions and an unsustainable operation model” in 2013 and last year, when the board decided to dismiss Tanoh.
Arqaam’s Antonios said the bank’s recent performance across the more than 30 countries that it operated in had been pleasing.
“We believe the bank’s strategy this year would continue to be focused on improving profitability in Nigeria and containing costs. Strategically, part of the focus will include deepening the Nedbank alliance and the QNB relationship.” – Bloomberg