Zenith Bank Plc, a Financial Institution in the Financial Services Sector, announced 189.10% Gross Earnings Growth in Q1 2024 Results.

Key Highlights 

• Gross Earnings grew by 189.1% from N269.99bn to N780.62bn.
• Profit before tax stood at N320.19bn
• Profit after tax stood at N258.34bn
• Share Price Currently Stands at N37.0k

Zenith Bank Shows Continued Market Leadership with 189% Growth in Q1 Earnings

Zenith Bank Plc has announced its unaudited results for the first quarter ended 31 March 2024. Gross earnings increased by 189%, impressive triple-digit growth from N270bn reported in Q1 2023 to N781bn in Q1 2024. This is despite the challenging operating environment and tightening monetary policy stance.

From the unaudited statement of account submitted to the Nigerian Exchange (NGX) on Friday, 3rd May 2024, this impressive growth in the topline also enhanced the bottom line, as profit before tax (PBT) rose to N320bn in Q1 2024, representing an increase of 270% from the N87bn reported in Q1 2023. Profit after tax (PAT) equally grew significantly by 291% from the N66bn reported in Q1 2023 to N258bn in the current period.

Interest and non-interest income contributed significantly to the growth in gross earnings. Interest income grew by 155% from the N192bn reported in the quarter ended March 2023 to N489bn in the period to 31 March 2024. The growth in interest income is due to the repricing of risk assets, owing to the increase in the central bank’s Monetary Policy Rate (MPR), which currently stands at 24.75%. The growth in net interest income is primarily due to the increase in fees and commissions and trading grains.

The Group reported an impairment charge of N56 billion for Q1 2024, up from N8bn recorded in Q1 2023. This is attributable to significant growth in risk assets, primarily driven by the revaluation of its USD loans, which necessitated additional impairment on the bank’s foreign currency-denominated loans.

The cost of funds grew by 48% from 2.7% in Q1 2023 to 4% in Q1 2024 due to the high-interest rate environment, while interest expense increased by 157% from N71bn reported in Q1 2023 to N182bn in the period to March 2024. Notwithstanding the year-on-year (YoY) increase in interest expense, net interest margin (NIM) grew by 20% from 6.9% in the three months ended March 2023 to 8.3% in the current period ending 31 March 2024. Return on Average Equity (ROAE) and Return on Average Assets (ROAA) increased year-on-year (YoY) by 114% and 119%, respectively, due to improved profitability.

Gross loans, largely funded by customer deposits, grew by 30% from N7.1trn in December 2023 to N9.2trn in March 2024. Customer deposits also grew by 11% from N15.2trn in December 2023 to N16.8trn in March 2024, underpinning continued customer confidence in the Zenith brand. Total assets increased by 19% to N24trn within the same period.

The Group has consistently maintained all prudential ratios above the minimum regulatory requirement. At the end of Q1 2024, Capital Adequacy Ratio (CAR) and Liquidity Ratio stood at 20% and 67%, respectively, demonstrating the Group’s ability to maintain a strong and liquid balance sheet.

The Group is progressing on the planned capital raise to support future growth. It is very optimistic about meeting the new minimum capital requirements in line with the CBN’s recapitalisation directive. As the Group accelerates migration to its latest technology architecture and transitions into a holding company, it remains poised to maximise value for all stakeholders.