Zenith Bank Plc, a leading financial institution in Nigeria, has reported a remarkable 189% surge in gross earnings for the first quarter ending March 31, 2024, reaching a staggering ₦781 billion, up from ₦270 billion in the same period last year. This significant growth has been achieved despite a challenging economic landscape and a tightening of monetary policies.
The unaudited financial statement, released to the Nigerian Exchange (NGX) on May 3, 2024, reveals that the bank’s profit before tax (PBT) climbed to an impressive ₦320 billion, marking a 270% increase from the ₦87 billion reported in the first quarter of 2023. Similarly, the profit after tax (PAT) witnessed a substantial rise of 291%, growing from ₦66 billion to ₦258 billion.
A key driver of this growth has been the robust performance in both interest and non-interest income. Interest income alone expanded by 155%, from ₦192 billion to ₦489 billion, largely due to the repricing of risk assets following the hike in the central bank’s Monetary Policy Rate (MPR), which now stands at 24.75%. The bank’s net interest income benefited from increased fees, commissions, and trading gains.
The Group also reported a rise in impairment charges for the quarter, amounting to ₦56 billion, up from ₦8 billion in the previous year. This increase is primarily attributed to the growth in risk assets and the necessary revaluation of USD loans, leading to additional impairments on foreign currency-denominated loans.
Despite the higher cost of funds, which grew by 48% from 2.7% to 4%, and a 157% increase in interest expense, the bank’s net interest margin (NIM) improved by 20%, from 6.9% to 8.3%. The Return on Average Equity (ROAE) and Return on Average Assets (ROAA) also saw significant year-on-year increases of 114% and 119%, respectively, reflecting enhanced profitability.
Customer confidence in Zenith Bank remains strong, as evidenced by a 30% growth in gross loans and an 11% increase in customer deposits. Total assets have risen by 19% to ₦24 trillion.
Zenith Bank continues to exceed regulatory requirements, with a Capital Adequacy Ratio (CAR) of 20% and a Liquidity Ratio of 67%, showcasing the Group’s solid and liquid financial position.
Zenith Bank’s Q1 Earnings Soar by 189%, Signaling Potential Record-Breaking #Year Ahead
Looking ahead, the Group is progressing with its capital raise plans to support future growth and is optimistic about meeting the new capital requirements set by the Central Bank of Nigeria (CBN). As Zenith Bank transitions into a holding company and upgrades its technology infrastructure, it is strategically positioned to maximize value for all stakeholders and potentially surpass its 2023 results.