Togo: IB Bank Records First Profit in Over a Decade

Banking

Wednesday, 24 July 2024 08:12

Togo: IB Bank Records First Profit in Over a Decade

(Togo First) - IB Bank Togo (formerly BTCI) recorded a net profit of over 3 billion FCFA in 2023, way above 2022’s CFA8.8 billion loss. Khalid Yacoubou Boukari, the bank's Director of Commitments, recently disclosed the data on LinkedIn, without providing further details.

In 2021, the BTCI (now IB Bank Togo) was privatized–a moved that aimed to to help it be more financially healthy and better contribute to Togo’s economy. The government holds a 10% stake in the bank and IB Holding holds the remaining 90%. The purchase, led by Mahamadou Bonkoungou, a construction mogul and head of IB Holding, was intended to reshape the bank and strengthen its foundations.

Last year, IB Bank Togo recorded a net profit of CFA3 billion, a first win since 2013.

A Turning Point in 2022

IB Bank had been losing money until 2023. However, the bank's assets grew from CFA292 billion in 2021 to CFA418 billion in 2022. The surge was mostly driven by a doubling of customer loans, which rose from CFA111 billion in 2021 to CFA250 billion in 2022. Although the bank was undergoing restructuring, the reasons behind this growth remain unclear. However, the bank faces heightened risks and increased provisions for bad debts.

Still in 2022, IB Bank Togo recorded a net banking income of CFA13.4 billion in 2022, against CFA8.6 billion in 2021. Higher interest and commission income drove the spike. Nevertheless, the latter was insufficient to offset the impact of operating expenses and risk costs.

In 2022, the bank reported a net loss of CFA8.8 billion, against CFA1.3 billion in 2021. The widening was consequential to a significant rise in risk costs–they lept from CFA221 million to CFA11.9 billion.

Customer Confidence Remains Strong

In spite of the various hurdles the bank faces, customer confidence appears intact. Deposits surged to CFA409 billion in 2022, up from CFA275 billion in 2021, indicating a level of stability despite the bank's negative equity of -CFA4.5 billion.

Cutting Existing Negative Earnings

Last year’s profit, CFA3 billion, should help curb the negative retained earnings accumulated over the past decade. While details are still pending, the 2023 reports are anticipated to provide more insight into the performance of the former BTCI.

Fiacre E. Kakpo

REFORMS OVERVIEW

STARTING A BUSINESS (more info)

At the fifteenth position, worldwide, and first in Africa, under the Starting a Business index of the 2020 Doing Business ranking, Togo sustains its reformative dynamics with more reforms….

ENFORCING CONTRACTS (more info)

Compared to some years ago when it was one of the lowest rankers under the Doing Business’ Enforcing Contracts indicator, Togo, leveraging many efforts to improve its business climate, was able to jump significantly on the index in the recent years... .

CONTRACT EXECUTION (more info)

Creation of special chambers of commerce for small debts • Creation of chambers of commerce at the Court of Appeal • Civil and commercial cases now handled by distinct clerks • Establishment of commercial courts in Lomé and Kara • Lawyers and bailiffs now have access to the FORSETI COMMERCIAL platform • A maximum period of 100 days was fixed to settle a commercial dispute .

TRADING ACROSS BORDERS (more info)

In comparison to previous years,Togo has significantly improved its ranking under the“Trading across borders” indicator by adopting multiple reforms that focus mainly on the digitization and reduction in delays, for import and export procedures related to import and export.

In comparison to previous years, Togo has significantly improved its ranking on the “Trading across borders” index by adopting multiple reforms that focus mainly on the digitalization and reduction in delays, for import and export procedures related to import and export.

CONSTRUCTION PERMIT (more info)

After moving from the 133rd to 127th place under the 2020 Doing Business’ construction permit index, Togo intends to reiterate this feat in the coming edition of the global ranking. To this end, it has introduced this year multiple reforms.

GETTING ELECTRICITY (more info)

Over the past two years, Togo’s ranking under the Doing Business’ Getting electricity and water indicator has increased consistently. Owing this performance to multiple reforms aimed at making it easier for businesses to access power and water, Lomé plans to introduce even more reforms this year to keep up its improvements.

REGISTERING A PROPERTY (more info)

Out of all the 'Doing Business’ indicators, Property Registration is where Togo has improved the most since 2018. Indeed, after spending years in the lowest part of this ranking, the country now seeks to beat Rwanda which is the best performer on this index in Africa. To do so, Lomé has been introducing many reforms, with the latest batch implemented this year.

PUBLIC PROCUREMENT (more info)

From professionalization to digitization, through legislative regulations, Togo’s public procurement framework is constantly being modernized. Several reforms have been implemented to improve the sector much to the benefit of the private sector, which is the focus of the National Development Plan.

PAYING TAXES AND DUTIES (more info)

To improve its business environment, Togo introduced some important reforms related to the payment of tax and duties. From the replacement of some taxes to the cancellation of others through exemptions, the country has only one objective: offer the most attractive tax framework to investors and economic operators. To achieve this, the authorities relied on digitization.