Table of Contents
Key Points
- Nedbank to exit Ecobank with $105.8 million stake sale, ending a 17-year alliance to refocus on Southern and East African markets.
- CEO Jason Quinn sharpens Nedbank’s regional growth strategy as West African risks, Nigeria exposure, weaken returns.
- Despite 6% profit rise, Nedbank stock drops 5% after Ecobank divestiture; $662 million committed to Africa expansion.
Nedbank, a renowned financial services group led by South African banker and business executive Jason Quinn, is divesting its 21.2 percent stake in Ecobank Transnational Inc. as it sharpens its geographic focus on Southern and East Africa. The move marks the end of a 17-year strategic alliance with the Togo-based pan-African lender.
The South African bank confirmed that the stake—classified under IFRS 5 as a non-current asset held for sale—has a market value of R1.9 billion ($105.8 million). The decision follows a strategic review by Nedbank’s board and management amid underwhelming returns and macroeconomic pressures in West Africa.
Currency risk, Nigeria exposure prompts exit
Ecobank’s significant presence in volatile markets such as Nigeria has weighed on cross-border synergies and returns. Nedbank noted that several South African clients have exited the Nigerian market, eroding the collaborative advantages initially expected from the partnership.
“Regulatory uncertainty and potential capital requirement increases make continued exposure unattractive,” said Quinn. “If a sale is concluded, it will be a clean exit.” Despite reporting associate income of R6.8 billion ($378.6 million) over the years, Nedbank has only realized R4 million ($222,700) in dividends from the stake. The bank is currently in talks with interested buyers to finalize the divestiture.
Regional expansion, strong earnings under Quinn
Since taking the helm in May 2024, Quinn has overseen a renewed regional growth strategy focused on Southern and East Africa, with subsidiaries in Zimbabwe, Namibia, Mozambique, Eswatini, Lesotho, and Malawi, and a strategic presence in Angola and Kenya.
For the six months ended June 30, 2025, Nedbank reported a 6 percent increase in headline earnings to R8.4 billion ($467.65 million) from R7.9 billion ($439.77 million) a year earlier, while revenue rose 4 percent to R36.4 billion ($2 billion) from R35.16 billion ($1.96 billion). However, the bank lowered its 2025 guidance, projecting diluted headline earnings per share (DHEPS) growth in the low single digits and return on equity around 15 percent.
Nedbank also declared an interim dividend of R10.28 ($0.57) per share from income reserves. The company has committed $662 million to deepen its African footprint, targeting a rise in non-South African profits from 9.2 percent to as much as 40 percent by 2029. Despite the solid earnings performance, Nedbank shares dropped more than 5 percent at the market open following the divestment announcement.
