Emmanuel Ojukwu
One of Nigeria’s leading financial institutions, Zenith Bank Plc, has reported exceptional financial results for the half-year ending June 30, 2024, showcasing a remarkable 117% surge in gross earnings, reaching N2.1 trillion, up from N967.3 billion in the same period of 2023.
This strong performance underscores the bank’s resilience and strategic prowess in navigating Nigeria’s complex macroeconomic landscape. According to the bank’s audited financial results submitted to the Nigerian Exchange (NGX) on August 30, 2024, the substantial increase in gross earnings also translated into significant growth in profitability.
The Group’s profit before tax soared by 108% year-on-year, climbing from N350 billion in H1 2023 to N727 billion in H1 2024. Similarly, profit after tax grew by 98%, rising from N292 billion to N578 billion over the same period, driving earnings per share (EPS) to nearly double from N9.29 to N18.41.
This robust financial performance was driven by strong growth in both interest and non-interest income. Interest income hit a historic half-year milestone, exceeding N1 trillion a 177% increase from N415.4 billion in H1 2023—fueled by the effective pricing of risk assets. Meanwhile, non-interest income also experienced significant growth, rising by 74% from N515.7 billion to N899.3 billion.
Despite an increase in the cost of funds due to the high-interest rate environment, which saw interest expenses grow from N153.6 billion in H1 2023 to N434.4 billion in H1 2024, Zenith Bank’s net interest margin expanded by 49% to 8.8%, highlighting the bank’s ability to efficiently manage its interest-earning assets and liabilities.
The Group also reported a 35% growth in total assets, which increased from N20.4 trillion in December 2023 to N27.6 trillion in June 2024, while customer deposits saw a 29% increase, reaching N19.6 trillion. Gross loans expanded by 44%, aided by increased loan disbursements and the translation effect of foreign currency-denominated loans.
Zenith Bank’s disciplined risk management approach ensured that its non-performing loan ratio remained stable, with only a slight increase from 4.4% in December 2023 to 4.5% in June 2024. Capital adequacy ratio improved to 23%, up from 21.7%, while the loan-to-deposit ratio rose to 51.7%. Despite a reduction in liquidity ratio from 71% to 59%, all prudential ratios remain well above regulatory thresholds.
In recognition of its outstanding performance, the Group has declared an interim dividend of N1.00 per share, marking its highest half-year dividend payout and the largest interim dividend in the Nigerian banking sector to date.
As part of its ongoing expansion strategy, Zenith Bank has received regulatory approval to establish a third-country branch in Paris, France, which will enhance its international product offerings. The bank is also making significant investments in upgrading its digital banking infrastructure, positioning itself to meet the new minimum capital requirements for commercial banks with international authorization, as mandated by the Central Bank of Nigeria (CBN).
Source: Nairametrics
