Zenith Bank becomes first Nigerian bank to hit N208 billion profit in 2019

Zenith Bank Plc has emerged the first Nigerian bank to hit the N200 billion mark after the management announced a profit after tax of N208.8 billion for the year ended December 31, 2019.

The bank’s audited financial results for the 2019 financial year, which was released on Friday, February 21, shows that the profit after tax rose by 8% from the N193 billion recorded in the previous year to N208.8 billion in 2019.

Also recorded by the banking group is a growth in gross earnings of 5% rising to N662.3 billion from N630.3 billion reported in the previous year.

This growth, a statement from the bank says, was driven by the 29% 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.

Zenith bank wins pearl awards
Zenith bank wins pearl awards

In the statement, the Zenith Bank group also said the increase in the figures was a “validation of the bank’s retail transformation strategy which continues to deliver impressive results”.

The bank’s profit before tax also increased by 5% 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 the 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 an improved Earnings per Share (EPS) which grew 8% from N6.15 to N6.65 in the current year.

Zenith bank
Zenith bank management declares a profit after tax of over N200 billion.

The bank said it 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 trillion to N2.462 trillion. 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.

Shareholders in the bank are also compensated as the bank announced a proposed final dividend payout of N2.50 per share, bringing the total dividend to N2.80 per share.

“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.”

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