Home Business Zenith Bank Announces N117.06bn PBT, Declares N0.30 Interim Dividend

Zenith Bank Announces N117.06bn PBT, Declares N0.30 Interim Dividend


Zenith Bank Plc for the half year ended December 31, 2021 reported an increase of three per cent in profit before tax to N117.06billion from N114billion reported in prior half year ended June 30, 2020.

The lender on the Nigerian Exchange Limited (NGX) also reported two per cent increase in profit to N106.11billion in H1 2021 from N103.83 billion reported in H1 2020.

With the growth in profit, the Board of Directors of Zenith Bank maintained interim dividend of N0.30 per share (2020: Interim dividend of N0.30 per share) from the retained earnings account as at 30 June, 2021.

The Group also recorded a nine per cent growth in non-interest income from N116 billion in H1 2020 to N127 billion in H1 2021, while interest income dropped by six per cent from N217 billion to N204 billion as yields from some interest-bearing assets declined.

The Bank.said: “This was mitigated by a 26 per cent decrease in interest expense from N60 billion in June 2020 to N44 billion in June 2021 resulting in an increase in net interest income from N157 billion to NGN160 billion in June 2021.

“Overall, the significant reduction in interest expense by 26 per cent and growth in non-interest income by nine per cent gave rise to improved profitability.

“The Group’s retail journey continues to deliver positive results. Retail deposits grew by N38.2 billion from N1.72 trillion to N1.76 trillion year-to-date (YTD).

“Savings balances grew marginally by two per cent YTD to close at N1.18 trillion from N1.16 trillion as at December 2020. The drive for increased retail deposits and a low-interest yield environment helped reduce the cost of funding from 2.2% to 1.3 per cent  in the current period.

“However, the low-interest environment also affected the net interest margin, which declined from nine per cent to 6.5per cent in the current year due to the re-pricing of interest-bearing assets.”

Zenith Bank’s Operating expenses grew by 10per cent YoY to N149.85 billion in H1 2021 from N135.85 billion in H1 2020 as growth remains below the inflation rate.

The Bank explained that, although returns on equity and assets also reduced from 21.5 per cent to 18.5 per cent and from three per cent to 2.5 per cent, respectively, the Group improved its Earnings per Share (EPS) which grew two per cent from N3.30 to N3.38 for the half year ended June 2021.

The Group also increased total customer deposits by eight per cent to close the period at N5.77 trillion, which demonstrates growth in the Group’s market share.

Total assets grew marginally to N8.52 trillion as at 30 June 2021 from N8.48 trillion as at 31 December 2020.

“Despite the challenges imposed by the COVID-19 pandemic and the challenging operating environment, the Group grew its risk assets as gross loans grew by three per cent YTD, from N2.92 trillion to N2.99 trillion.

“This was conservatively achieved at a low Non-Performing Loan (NPL) ratio of 4.51 per cent (FYE 2020: 4.29 per cent) and a reduced cost of risk of 1.3 per cent (June 2020: 1.8 per cent).

“Prudential ratios such as liquidity and capital adequacy also remained above regulatory thresholds at 69.9 per cent and 22 per cent respectively.

“Despite the continued prevalence of COVID-19, there is a cautious optimism that the global economy will continue to recover as vaccination programmes are intensified.

“The Group is well-positioned to maximise the opportunities that these recovering fundamentals present while leveraging e-technology to expand the retail footprint to deliver improved returns to all its stakeholders,” the Bank added.



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