Zenith Bank Announces impressive half year financial result

By Emmanuel Uffot

 In spite of the biting Nigerian economy which has strangulated most sectors of the economy with attendant harsh operating environment for banks and other manufacturing sectors, Zenith bank has announced its half year result ended June 30 2022 recording a 17 percent growth in gross earnings from N346 billion reported within the same period under review in 2021 to N405 billion this year.

According to the bank’s audited reports unveiled  at the Nigeria Stock Exchange the growth manifested in a  19 percent increase in interest income from N204 Billion to N242 billion and an 18 percent growth in non-interest income from N127 billion to N149 billion. According to the bank, the growth in interest income was driven by the modest increase in the loan book and improved interest margins, while the increase in non-interest income was attributed to the Group’s success in its income diversification strategy.

Similarly, profit before tax grew by 11 percent within the period under review from N117 billion to N130 billion while earnings per share also grew from N3.38 to N3.55 over the same 6-month period.

The Zenith Bank customer deposits also recorded 11 percent increase in customer deposits to close the period at N7.15 trillion. Similarly, its retail strategy has continued to deliver outstanding results as retail deposits grew by 17 percent from N1.82 trillion to N2.13 trillion. Retail activities also supported the growth recorded in fees on electronic products which grew by 45 % from N17 billion to N25 billion.

According to the bank’s records, despite the elevated yield environment, the cost of funds increased only marginally from 1.3 percent in June 2021 to 1.4 percent in June 2022. The increase in the cost of funds was lower than the increase in the yields on interest-generating assets, giving rise to the Net interest Margin of 7.1% from 6.4% in June 2021.

In the same vein, total assets of the Group rose to N10.12 trillion as at June 30 2022 from N9.45 trillion recorded at the end of December 2021.  The bank also stated that despite the risk challenges posed by the difficult operating environment, it was still able to grow its risk assets as gross loans grew from N3.5 trillion to N3.7 trillion, representing a five percent increase. This was achieved at a moderate NPL ratio of 4.4% and cost of risk of 1.4 %.

Prudential ratios such as liquidity and capital adequacy also remained stable and well above regulatory thresholds at 60.5% and 21% respectively.

 Boosted by the impressive half year result, the bank say it is poised to focus on advancing its digital banking strategy anchored on a strong technology base, and intends to consolidate on the gains achieved in prior years across all business segments. Combined with the Group’s industry leadership, “we expect this to drive improved performance and deliver enhanced returns to stakeholders.

Zenith Bank’s track record of excellent performance has continued to earn the brand numerous awards over the years. They include the Number One Bank in Nigeria by Tier-1 Capital for the 13th consecutive year, in the 2022 Top 1000 World Bank’s Ranking published by the Banker Magazine, Best Bank in Nigeria FOR  three consecutive years from 2020 to 2022 in the Global Finance World’s Best Banks Awards, Best Corporate Governance Bank in Nigeria in the World Finance Corporate Governance Awards 2022, Best in Corportate Governance ‘Financial Services’ Africa for three consecutive years from 2020 to 2022 by the Ethical Boradroom, Best Commercial Bank in Nigeria and Best Innovation in Retail Banking Awards.

The Bank also emerged the as the most Valuable Banking Brand in Nigeria in the Banker Magazine Top 500 Brands 2020 and 2021, Bank of the Year (Nigeria) in the Banker’s Bank of the Year Awards 2020 and Retail of the Year at the Business Day Banks and other Financial Institutions Award 2020 and 2021. It equally won This Day honour as Bank of the Decade the newspaper’s 2020 award among others.

 It could be recalled that early this month, Zenith Bank plc, won a twin award of Best Commercial Bank and Best Corporate Governance Bank in the 2022 edition of World Finance Banking Awards. The bank emerged as the Best Commercial Bank in Nigeria in the World Finance Banking Awards for the second consecutive year. It was also named the Best Corporate Governance Bank in Nigeria, in the World Finance Corporate Governance Awards 2022.

The awards were presented to the Group Managing Director/ Chief Executive Officer of Zenith Bank plc, Mr Ebenezar Onyeagwu at the event held at the London Stock Exchange . The organisers’ said the awards to the bank were in recognition of its ability to embrace digital transformation and best-in- class sustainability and corporate governance practices leading to sterling business performance in a difficult economic climate.

Onyeagwu, in his reaction to the double awards, said the awards were a reflection of the bank’s strong business fundamentals and ability to adapt to the prevailing changing dynamics of the market. “These awards reflect our strong business fundamentals, resilience and ability to adapt to the ever-changing dynamics of the market through our innovative solutions, as well as our commitment to global best practices. As a member and signatory to various domestic and international sustainability frameworks including the United Nations Global Compact and the Central Bank of Nigeria Sustainable Banking Principles, we continue to support the achievement of the Sustainable Development Goals by creating value for our shareholders, customers, clients, investors, communities and environment through our practices, operations and investments”.

Ovia: Chairman, Zenith Bank

The Zenith Bank CEO, however dedicated the awards to the founder and Group Chairman Jim Ovia for his pioneering role in building the structures and laying the foundation for an enduring and successful institution. He equally extended his commendation to the Board for the outstanding leadership they provide, the staff for their commitment and dedication and the teaming bank’s customers for making the bank their preferred financial institutions for the over two decades of its operation in Nigeria and offshore.

 To arrive at the winners of the coveted award, editors of the Global Finance, the organisers of the award make the selections after extensive consultations with corporate financial executives, bankers, banking consultants and analysts worldwide.

Some of the criteria considered by the body to choose winners include growth in assets, profitability, geographic reach, strategic relationships, new business development and innovation. Others are opinions of equity analysts, credit rating analysts and banking consultants among others.

Global Finance Best Bank Awards are reputable financial awards recognized worldwide as the most credible global banking and finance awards in the industry. Winners for the award are chosen from 150 countries across Asia, Africa, Central America, Europe, South America, North America, Middle East and the Caribbean.

The Tier-1 new generation bank was founded by Jim Ovia in May 1990 and commenced operation as a commercial bank in July 1990. The bank which currently has a capital and shareholders’ funds of N1.28 trillion and N9.6 trillion total asset base, operates from no fewer than 500 branches across Nigeria with offshore operations in United Kingdom, Ghana, Sierra Leone and Gambia.

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