Zenith bank sets new record, declares N208.8 billion profit after tax

Zenith bank sets new record, declares N208.8 billion profit after tax

Zenith Bank International has announced a N208.8 billion profit after tax for the year ended December 31, 2019.

With the feat, the bank becomes the first Nigerian bank to declare more than N200 billion as profit after tax.

According to the bank’s audited financial results for the 2019 financial year released in Lagos yesterday, profit after tax rose by 8 per cent to N208.8 billion from the N193 billion recorded in the previous year.

The Group also recorded a growth in gross earnings of 5 per cent, rising to N662.3 billion from the N630.3 billion reported the previous year.

The report said the growth was driven by the bank’s 29 per cent increase in non-interest income from N179.9 billion in 2018 to N231.1 billion in 2019.

“Fees on electronic products continue to grow significantly with a 108% Year on Year (YoY) growth from N20.4 billion in 2018 to N42.5 billion in the current year,” the report said, describing the development as a validation of the bank’s retail transformation strategy which continues to deliver impressive results.

The report added: “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% to 48.8%.

“The drive for cheaper retail deposits coupled with the low interest yield environment helped reduce the cost of funding from 3.1% to 3.0%.

“However, this also affected net interest margin which reduced from 8.9% to 8.2% in the current year due to re-pricing of interest bearing assets.

“Although returns on equity and assets held steady YoY at 23.8% and 3.4% respectively, the Group still delivered improved earnings per Share (EPS), which grew (by) 8% 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% to close at N4.26 trillion.

“Total assets also increased by 7% from N5.96 trillion to N6.35 trillion.

“The Group created new viable risk assets as gross loans grew by 22% from N2.016 billion to N2.462 billion. This was executed prudently at a low cost of risk of 1.1% and a significant reduction in the non-performing loan ratio from 4.98% to 4.30%.

“Prudential ratios such as liquidity and capital adequacy ratios also remained above regulatory thresholds at 57.3% and 22.0% respectively.”

According to the report, in 2020, “the Group remains strategically positioned to capture the opportunities in the corporate and retail segments, while efficiently managing costs and expanding further its retail franchise employing digital assets and innovation.

“Consistent with this superlative performance and 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 Most Valuable Banking Brand in Nigeria 2019 by The Banker. “

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