Ecobank Ordered to Pay Former CEO Tanoh $12.3 Million

 

Ecobank Transnational Inc. (ETI) was ordered by the commercial court in Abidjan to pay former Chief Executive Officer Thierry Tanoh 7 billion CFA Francs ($12.3 million) in compensation, said Francois Koumoin, the president of the court.

Tanoh, an Ivory Coast national, was removed as CEO of the Lome, Togo-based bank in March after regulators probed allegations of management fraud and poor corporate governance at the pan-African lender. He was replaced by his deputy Albert Essien.

Ecobank considers the decision “unfortunate and unfair” and the amount “excessive,” and will appeal against it, Richard Uku, a spokesman for the company, said Thursday. He said the bank has argued that any legal proceedings should take place in the U.K. or at an international tribunal, since the employment contract was under U.K. law.

A separate lawsuit for unfair dismissal is under way in Togo, according to Uku.

Founded in 1985, Ecobank operates in France and 35 African countries and has representative offices in Beijing, Dubai and London. Johannesburg-based Nedbank Group Ltd. (NED) owns a 20 percent stake, Qatar National Bank SAQ 16.9 percent and South Africa’s Public Investment Corp., the continent’s biggest fund manager, 13.9 percent, data compiled by Bloomberg show.

The PIC called for Tanoh to quit after allegations of mismanagement, which he denied. Investors in March approved a plan to implement recommendations on corporate governance by Nigeria’s Securities and Exchange Commission.

Study Ruling

The PIC is waiting to study the ruling before commenting further, CEO Dan Matjila said when contacted by phone. A spokeswoman for Nedbank referred questions to the Ecobank spokesman.

Nigeria’s regulator investigated the lender after whistle-blower Laurence do Rego, the bank’s group executive director of finance and risk, told the SEC in August 2013 that Tanoh and former Chairman Kolapo Lawson planned to sell assets below market value. Do Rego said she was pressured to write off debts owed by a business headed by Lawson and manipulate the bank’s results. Tanoh and Lawson denied any wrongdoing.

The company’s stock is traded in Abidjan in Ivory Coast, Nigeria and Ghana.

 

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