Ecobank Nigeria Repays $150 Million Eurobond Early in Strategic Liquidity Move

Ecobank Nigeria Limited has repaid $150 million of its $300 million 7.125% Eurobond due February 2026, a key milestone in its ongoing balance sheet optimisation strategy.

The early redemption, which was completed on July 8 through a tender offer and exit consent process, represents 50 percent of the outstanding bond and reinforces the lender’s liquidity position amid ongoing macroeconomic volatility.

The repayment comes as Ecobank Nigeria reports improving cash flows, supported by increased loan recoveries and the early settlement of promissory notes from its parent company, Ecobank Transnational Incorporated.

The bond was trading near par prior to the buyback, indicating sustained investor confidence in the bank’s creditworthiness and overall fundamentals.

In addition to the partial redemption, bondholders approved the removal of a capital adequacy ratio (CAR) covenant tied to the Eurobond following a consent solicitation process.

The CAR covenant had been triggered earlier in 2024 after Ecobank Nigeria’s CAR fell to 7.65 percent, below the 10 percent regulatory threshold for national banks, primarily due to naira depreciation which impacted its foreign currency asset base.

The bank has outlined a recovery plan aimed at restoring capital adequacy, including profit growth initiatives, cost optimisation, and capital support from its parent entity.

Ecobank Nigeria said the early repayment forms part of a broader liability management strategy designed to reduce debt service obligations and enhance operational flexibility.

The bank also confirmed its intention to redeem the remaining $150 million of the Eurobond at maturity in February 2026, subject to market conditions.

Preliminary results for the first half of 2025 show revenue rose by 30 percent year-on-year to N113.7 billion, while profit before tax increased 90 percent to N13.5 billion, driven by stronger net interest income and non-interest revenue.

Impairment charges rose to N32.8 billion, reflecting the bank’s decision to front-load provisioning to strengthen its loan portfolio amid economic headwinds.

Ecobank Nigeria has activated an “asset quality war room” to expedite loan recoveries, particularly in the oil and gas segment, where recent reforms and higher production volumes have improved credit performance.

Despite earlier challenges, the bank’s liquidity ratio remains well above the 30 percent regulatory minimum, supported by prudent treasury operations and disciplined lending.

Analysts view the early bond repayment as a proactive liquidity and risk management decision that reflects positively on the bank’s financial resilience.

Ecobank Nigeria said it remains committed to capital preservation, cost discipline, and sustainable growth as it executes its transformation agenda across key business segments.