Zenith Bank Plc has recorded a profit after tax of N88.882 billion for the half year ended June 30, 2019 as against N81.737 billion reported in 2018, representing a growth of 8.74 per cent.
In a filing with the Nigerian Stock Exchange (NSE), the group’s pre-tax profit also rose by 4.02 per cent from N107.358 billion during the previous year to N111.677 billion during the period under review.
The lender’s gross earnings stood at N331.586 billion as against N322.201 billion posted in 2018, accounting for a growth of three per cent.
The management of the bank in a statement noted that as a testament to its commitment to its shareholders, the bank also announced a proposed interim dividend pay-out of 30 kobo per share.
“The gross earnings was driven by a significant growth of 24 per cent year-on-year (Y-o-Y) in non-interest income from N88.6 billion in H1 2018 to N109.7 billion in H1 2019. In particular, fees from electronic products increased by N17bn (168 per cent) from N10 billion in H1 2018 to N27 billion in H1 2019, demonstrating significant progress in our retail banking initiatives.
“This top-line growth filtered through to the bottom-line as Profit Before Tax (PBT) increased to N111.7 billion reflecting a 4 per cent growth over N107.4 billion reported in H1 2018 with earnings per share (EPS) increasing by 9 per cent to N2.83 in H1 2019 from N2.60 compared to the prior period.
“Between December 2018 and June 2019, the group’s total deposit increased by three per cent with retail deposits growing by N267 billion (31 per cent), from N861 billion to close at N1.1 trillion. Despite the growth in our deposit base, we optimized interest expense leading to a four per cent reduction from N74.7 billion to N72.1 billion due to the group’s improved funding mix and our profound treasury management skills. Net Interest Margins (NIMs) witnessed a compression from 10 per cent in the same period last year to 8.6 per cent in H1 2019, as a result of the declining yield environment but cost of funds improved from 3.4 per cent to 3.0 per cent.
“Our robust risk management ensured that our absolute gross Non-Performing Loans (NPLs) remained flat. However, the marginal movement in NPL ratio was as a result of the three per cent reduction in our loan book from N2.02 trillion as at December 2018 to N1.95 trillion at the end of the period. We are creatively deploying new retail loan products to ensure we capture a reasonable share of the retail loan market. We remain committed to maintaining our strong balance sheet with liquidity ratio at 74.6 per cent and Capital Adequacy Ratio (CAR) at 25 per cent, ensuring we remain above regulatory thresholds.
“Going into the second half of the year, we will continue to consolidate our leadership in the corporate space while our retail banking drive will continue unabated. We expect to see an improvement in economic activities even as we maintain our promise of delivering a unique service experience to our customers,” the bank noted.
