Nedbank's Ecobank split triggers strategic realignment in Africa

Source: Nedbank Group.

The decision to end the 17-year alliance follows a strategic review by the Group, which revealed a shift in Nedbank’s continental strategy. This shift was driven by growing regulatory uncertainty across Africa and the prospect of increased capital requirements.

As a result, the Group is looking to focus on growth on the Southern African Development Community (SADC) and East Africa—regions where it can operate businesses it owns and controls.

The Group is actively seeking buyers for its 21.2% stake in the pan-African bank.

Nedbank chief executive officer Jason Quinn announced that the stake was reclassified as a “non-current asset held for sale” from 30 June 2025. He confirmed that a formal plan has been approved by the board, and the bank is now engaging with interested parties.

ETI, based in Lomé, Togo, operates in over 30 African countries.

Earnings outlook downgraded

Despite this strategic repositioning, Nedbank’s share price dropped 4.92% to R236.40 following the release of its interim results. The bank revised its full-year earnings outlook downward, citing South Africa’s challenging economic environment and the impact of the ETI exit.

Return on equity (ROE) is now forecast at around 15%, down from a previous estimate of 16%, and diluted headline earnings per share (DHEPS) growth is expected to be in the low single digits.

Still, Nedbank reported a 6% rise in headline earnings to R8.4bn and an ROE improvement to 15.2%.

Growth was driven by increased non-interest revenue, better associate income, improved impairment charges, and effective expense management, although net interest income growth remained subdued.

Quinn noted global geopolitical and economic pressures dampened business confidence.