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Equity ranks position 7 in the list of top 10 banks in Africa

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  • Equity improved on its performance with a 14% profit after tax growth to Sh22.6 billion from Sh19.8 billion in 2018.
  • Equity had a 23% growth in loan book to Sh366.4 billion from Sh297.2 billion in 2018.
  • Dr. James Mwangi: “The ranking is an indication that Equity remains robust, despite the challenging operating environment.”

Equity has become the first bank in Eastern and Central Africa to be listed among the top 10 banks in Africa.

The Dr. James Mwangi-led bank has been ranked at position 7 among the top 10 Banks in Africa in 2020, after scoring 5.82 in the overall category of the best performing banks.

According to The Banker’s Top 100 African Banks ranking for 2020, this year’s ranking tracked the health and wealth of the African banking sector and used an array of metrics including overall growth performance, financial soundness, profits on capital, leverage, and return on risk.

Equity improved on its performance with a 14% profit after tax growth to Sh22.6 billion from Sh19.8 billion in 2018.

The impressive performance registered during an interest capping period was driven by a 23% growth in loan book to Sh366.4 billion from Sh297.2 billion in 2018.

Reflecting on the performance, Dr. James Mwangi, Managing Director and CEO said that, the enhanced efficiency and cost optimization saw cost-income ratio improving to 51% from 52.4% in 2018. The Group has maintained its yield on interest-earning assets at 11.2% despite the challenge of interest capping and declining yield curve. Innovation has also been a great enabler in driving growth and is already registering efficiency gains from digitization.

On financial soundness, Equity ranked number 5 on the backdrop of an agile balance sheet with a liquidity of 52.1%, a loan deposit ratio of 75.9% and a core capital to risk-weighted asset ratio of 19.8%.

The balance sheet reflects solid diversified funding with customer deposits constituting 72% of the total funding, shareholders and long-term borrowing contributing 17% and 8% respectively.

The financial soundness is further enhanced by a strong capital base, which is well within both internal and regulatory limits, solid business performance and Net loans which constituted 54% of the total assets while government securities and cash and cash equivalents contributed 26% and 13% of the total asset allocation respectively.

“The ranking is an indication that Equity remains robust, despite the challenging operating environment. We have developed and adopted a sustainable business model to cushion the business as well as boost value creation for shareholders,” added Dr. Mwangi.

The Banker Top 1000 World Banks 2020 ranked Equity Bank 754 in balance sheet size overall in its global ranking, 62nd in soundness (Capital Assets to Assets ratio), 55th in terms of Profits on Capital and 20th on Return on Assets.

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