Zenith Bank Group’s earnings hit N630.3bn


Zenith Bank Group on Monday disclosed that it recorded a growth in gross earnings of 5 per to N662.3 billion from N630.3 billion reported in the previous year.

This growth, it noted, was driven by the 29 per cent increase in non-interest income from N179.9 billion in 2018 to N231.1 billion in 2019.

The Chairman of Zenith Bank Group, Mr Jim Ovia made the disclosure at the 29th annual general meeting held in Abuja.

According to him, fees on electronic products have continued to grow significantly with a 108 per cent Year on Year (Y-o-Y) growth from N20.4 billion in 2018 to N42.5 billion in the current year.

He described the feat as a validation of the bank’s retail transformation strategy which continues to deliver impressive results.

Profit before tax also increased by 5 per cent growing from N232 billion to N243 billion in the current year, arising from topline growth and continued focus on cost optimisation strategies.

“Cost-to-income ratio moderated from 49.3 per cent to 48.8 per cent.

The drive for cheaper retail deposits coupled with the low-interest yield environment helped reduce the cost of funding from 3.1 per cent to 3.0 per cent. However, this also affected net interest margin, which reduced from 8.9 per cent to 8.2 per cent in the current year due to re-pricing of interest-bearing assets.

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“Although returns on equity and assets held steady YoY at 23.8per cent and 3.4per cent respectively, the Group still delivered improved Earnings per Share (EPS) which grew 8per cent from N6.15 to N6.65 in the current year.

“The group increased its share of the market as it secured increased customer deposits across the corporate and retail space as deposits grew by 15 per cent to close at N4.26 trillion. Total assets also increased by 7 per cent from N5.96 trillion to N6.35 trillion. The Group created new viable risk assets as gross loans grew by 22per cent from N2.016 trillion to N2.462 trillion.

“This was executed prudently at a low cost of risk of 1.1 per cent and a significant reduction in the non-performing loan ratio from 4.98 per cent to 4.30 per cent. Prudential ratios such as liquidity and capital adequacy ratios also remained above regulatory thresholds at 57.3per cent and 22.0per cent respectively”, he noted.

In recognition of its track record of excellent performance, Zenith Bank was voted as the Best Commercial Bank in Nigeria 2019 by the World Finance and the Best Digital Bank in Nigeria 2019 by Agusto & Co. The Bank was also recognised as Bank of the Year and Best Bank in Retail Banking at the 2019 BusinessDay Banks and Other Financial Institutions (BOFI) awards.

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Ovia noted that total assets of Zenith Bank grew by 9.7 per cent from N4.96 trillion to N5.44 trillion, while shareholders fund rose by 15.4 per cent from N675 billion to N779 billion.

The Zenith Bank Chairman described 2019 as a challenging year for operators in the financial sector due to several supervening factors locally and globally.

“Our major focus in 2019 was to support the government’s effort at improving well-being and the life expectancy of Nigerians through support for quality healthcare in host communities.

He said the bank has invested heavily in technology and digital solutions to offer better services.

In his remarks, the Group Managing Director of the bank, Mr Ebenezer Onyeagu in an interview said shareholders have every cause to be elated given a higher dividend payout by the bank.

“On the whole, we are giving them a dividend of N2.80 Kobo which translates to a dividend yield of over 14 per cent. And when you look at it vis-à-vis the current share price, you are looking at a dividend of 15 per cent per annum. We have also assured the shareholders that no matter the challenges operating in the external environment, the bank will continue to be efficiently managed; we will create value and we won’t be reckless because we want to comply with loan to deposit ratio”.

“We will also continue to remain ethical and focused, so shareholders have reasons to be happy”, he said.

On implications of coronavirus, he said it was a global pandemic not peculiar to Nigeria.

‘What we have done as a bank is that we have made the health and safety of our staff as a priority. We have elevated our health and safety protocol. So, we are taking first, health precautionary measures. Secondly, we are looking at the areas of vulnerability as a financial institution and within this period, we have no plans of any risk acquisition until we see how the virus is contained in the global economy.

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“So, we can see the lockdown and downturn on the global economy and some financial losses it has caused. So, we have to access the full impact. What we are doing now is; we are watching cautiously and also see that the full principles of practice are elevated.

“Zenith bank remains a growth organization. We will continue to engineer growth organically and remain disciplined and focused in terms of our growth agenda”, said GMD.

The bank’s profit after tax rose by 7.6 per cent from N165 billion in 2018 to N178 billion in 2019.

He added that the profit before tax rose by 4.1 per cent from N192 billion in 2018 to N200 billion in 2019.

Ovia noted that total assets of Zenith Bank grew by 9.7 per cent from N4.96 trillion to N5.44 trillion, while shareholders fund rose by 15.4 per cent from N675 billion to N779 billion.

The shareholders approved the proposed final dividend of N2.50 per share, bringing the total dividend payment for the 2019 financial year to N2.80 per share with a total value of N87.9 billion.

This followed the recent release of the Bank’s audited financial results for the 2019 financial year.

According to the audited financial results for the 2019 financial year, Zenith Bank recorded a profit after tax (PAT) of N208.8 billion, an increase of 8per cent from the N193 billion recorded in the previous year, thus achieving the feat as the first Nigerian Bank to cross the N200 billion mark.

Most recently, the bank emerged as the Most Valuable Banking Brand in Nigeria, for the third consecutive year, in the recently released Banker Magazine “Top 500 Banking Brands 2020”, the Best Bank in Nigeria 2020 in the Global Finance World’s Best Banks Awards 2020, and the Bank of the Decade (People’s Choice) at the Thisday Awards 2020.

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