Nigeria’s leading financial institution, Zenith Bank has declared a profit after tax (PAT) of N209 billion in its recently released financial results for the year ended December 31, 2019, up from the N193 billion recorded the previous year, Zenith Bank has become the first Nigerian Bank to surpass the N200 billion mark.
According to the bank’s audited financial results for the 2019 financial year released recently in Lagos, profit after tax rose by 8% to N208.8 billion from the N193 billion recorded in the previous year.
The group also recorded a growth in gross earnings of 5% rising to N662.3 billion from N630.3 billion reported in the previous year.
This growth 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 continues 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.
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 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.
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.
The bank has announced a proposed final dividend pay-out of N2.50 per share, bringing the total dividend to N2.80 per share.
it stressed further that, “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.”