By Odunewu Segun
Zenith Bank which recently recorded a profit of N105.66 billion after tax, and also offered N57.6 billion, translating to N1.80 per share to its shareholders, has again announced a profit after tax of N26.573 billion for the first quarter ended March 31, 2016.
The bank ended the period with gross earnings of N84.177 billion, up from N81.421 billion, while net interest income stood at N58.157 billion as against N42.631 billion in 2015. It recorded impairment charges of N2.557 billion, up from N2.1 billion in 2015.
Commenting on the results, analysts at FBN Capital said Profit After Tax declined more than Profit Before Tax because Zenith Bank booked a significant positive result in other comprehensive income (OCI, N1.1billion) in Q1 2015.
“This year, the OCI line came in at just N147 million. Returning to profit before provisions, while net interest income grew strongly by 36 per cent to N58.2 billion, non-interest income fell 52 per cent to N15.3 billion. Relative to our forecasts, as aforementioned, both PBT and PAT surprised positively.”
The main drivers were better-than-expected results on the provisions and operational expenses (opex) lines, with variances of 41 per cent and 10 per cent respectively. Although net interest income actually beat our forecast by seven per cent, the weakness on the non-interest income line (32% below our forecast) proved significant,” the bank said.
Zenith Bank plus four other banks outperformed the market with the released of annual results for the financial year ended March 31, 2016, posting increases in both their profit before tax and profit after tax.
This is despite the huge provisions for bad loans that most of them made in the 2015 financial year.