Zenith Bank sustains profitability as pre-tax profit hits N180bn

One of Nigeria’s biggest banks, Zenith Bank Plc sustained its profitability status in the first nine months of the year despite the prevailing economic uncertainties in the country.

The bank’s unaudited financial results for the nine months period ended 30 September 2021 shows a Profit Before Tax of N180bn, reflecting a 1 percent growth over the N177bn recorded in the same period in 2020 amidst a challenging macroeconomic environment exacerbated by the Coronavirus (COVID-19) pandemic.

According to the Group’s unaudited nine months financial results presented to the Nigerian Exchange (NGX), gross earnings increased by 2 percent from N509 billion to N519 billion largely due to growth in current account maintenance fees as well as fees from electronic products during the period.

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Despite continuing economic uncertainties, the Group grew its net earnings through a reduction in the cost of funds while keeping the cost of risk flat—this strengthened Earnings Per Share (EPS) by 1 percent to NGN5.11.

The Group achieved a 9 percent growth in interest income from loans and advances on the back of an increase in gross loans of 9 percent year to date and enhanced efficiency, resulting in a 21 percent drop in interest expense to NGN74 billion from NGN94 billion. This culminated in growth in net interest income of 4 percent, from NGN225 billion recorded at the end of Q3 2020 to NGN235 billion in the current period.

Total assets also increased by 3 percent to NGN8.8 trillion in the current period, while total deposits grew by 13 percent to close at NGN6.0 trillion from NGN5.3 trillion as at 31 December 2020, with a substantial contribution from retail deposits.

As a result of the focused drive to increase retail deposits in the past three years, there was a decrease in The Group’s cost of funds by 35 percent to 1.4 percent from 2.2 percent year-on-year. The Group continues to make significant progress in its retail banking drive, as evidenced by remarkable growth in transaction volumes and value across its digital platforms and strong growth in customer acquisition.

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For the year’s final quarter, management’s outlook remains positive, buoyed by a declining inflationary trend, expected increase in foreign exchange inflows, and improving oil production. The Group remains focused on increasing its retail market share, consolidating its leadership position in the corporate segment and maintaining a robust balance sheet.

For over three decades, Zenith Bank has distinguished itself in the Nigerian financial services industry through superior service offerings, unique customer experience, and sound economic indices.

The Bank remains a clear leader in the digital space with several firsts in deploying innovative products, solutions, and an assortment of alternative channels that ensure convenience, speed, and safety of transactions.