After two years of strategic thinking, and inspirational leadership, Ebenezer Onyeagwu, group managing director/CEO of Zenith Bank has demonstrated that he is a right peg in a right hole as reflected in the bank’s growth and recognition locally and internationally.
On June 1, 2019, Onyeagwu assumed the leadership of the bank in line with the bank’s tradition and succession strategy of grooming leaders from within.
Assessing the achievements of Onyeagwu two years after, shows that he has maintained his commitment towards ensuring that the bank retained its leadership in the industry.
Read Also: Zenith Bank pays N94.19bn as dividend to shareholders
Recently, the bank was rated on key parameters such as asset quality, profitability and return to investors, by Coronation Asset Management, which found Zenith Bank’s track record impressive.
“The bank is a clear market leader, growing its total assets and Net Income by an annual average of 15.7 percent and 15.5 percent, respectively, over the last five years,” said Ope Ani and Guy Czartoryski of Coronation Research, in a recent report.
Under the leadership of Onyeagwu, the bank was ranked as the Number One Bank in Nigeria by Tier-1 Capital in the 2021 Top 1000 World Banks Ranking published by The Banker Magazine.
For the third consecutive year, the bank retained its position as the number one Tier-1 bank in Nigeria with a Tier-1 Capital of $2.64 billion, emerging as the 454th bank globally and the only Nigerian bank in the top 500.
The ranking, which was published in the July 2021 edition of The Banker Magazine of the Financial Times Group, United Kingdom, was based on the 2020 year-end Tier-1 capital of banks globally.
Zenith Bank’s financial performance for the year was underpinned by an 8 percent growth in non-interest income, with an improved market share in both retail and corporate sectors despite a very challenging macroeconomic environment exacerbated by the COVID-19 pandemic.
Speaking on the ranking, Onyeagwu, said, “this ranking is a demonstration of our resilience and doggedness as an institution given the very challenging macroeconomic environment brought about by the Coronavirus (COVID-19) pandemic, which had a significant deleterious impact on businesses globally. It is also an affirmation of our commitment to delighting and creating value for our customers through a broad range of superior product offerings, best-in-class service and top-of-the-range technology”.
He also expressed thanks to the bank’s numerous customers for making Zenith their bank of choice.
Tier 1 capital describes capital adequacy, and it is the core measure of a bank’s financial strength from a regulator’s point of view.
According to the ranking, Tier 1 Capital, as defined by the latest Bank for International Settlements (BIS) guidelines, includes loss-absorbing capital, i.e. common stock, disclosed reserves, retained earnings and minority interests in the equity of subsidiaries that are less than wholly owned.
This award is the latest amongst several awards and recognitions that the bank has received in recent times for its track record of excellent performance and commitment to global best practices.
Zenith Bank was voted as Bank of the Year (Nigeria) in The Banker’s Bank of the Year Awards 2020, Best Bank in Nigeria in the Global Finance World’s Best Banks Awards 2020 and 2021, and Best Corporate Governance ‘Financial Services’ Africa 2020 and 2021 by the Ethical Boardroom. Also, the bank emerged as the Most Valuable Banking Brand in Nigeria in the Banker Magazine Top 500 Banking Brands 2020 and 2021, and Number One Bank in Nigeria by Tier-1 Capital in the “2020 Top 1000 World Banks” Ranking by The Banker Magazine.
The bank was also recognised as Bank of the Decade (People’s Choice) at the ThisDay Awards 2020, Retail Bank of the year at the 2020 BusinessDay Banks and Other Financial Institutions (BOFI) Awards, and Best Company in Promotion of Good Health and Well-Being as well as Best Company in Promotion of Gender Equality and Women Empowerment at the Sustainability, Enterprise and Responsibility (SERAS) Awards 2020.
In a clear demonstration of its resilience, Zenith Bank recorded a 5 percent growth in its Profit After Tax (PAT) to N53.1 billion in the first quarter of 2021 from N50.5 billion recorded in March 2020. This was despite a very challenging macroeconomic environment aggravated by the COVID-19 pandemic.
From the unaudited statement of account presented to the Nigerian Stock Exchange (NSE) on Friday, 30th April 2021, the Group’s Profit Before Tax (PBT) also grew by 4 percent, from N58.8 billion to N61.0 billion in the same period.
The profitability was driven by the optimisation of the cost of funds and improvement in non-interest income. The bank’s cost of funds reduced significantly from 2.6 percent in March 2020 to 1.1 percent in March 2021. This was also reflected in interest expense which dropped by 45 percent from N32.8 billion to N18.0 billion over the same period. Non-interest income increased by 10 percent from N46.6 billion to N51.2 billion, driven by growth in credit-related fees and fees on electronic products.
Non-interest income was boosted by the increase in fees and commission income, which resulted from the increased volume of transactions across all the bank’s channels. Cost of risk dropped from 0.6 percent in March 2020 to 0.5 percent in March 2021, which affirms the bank’s prudent risk management, even as gross loans increased by 2 percent from N2.92 trillion to N2.98 trillion in Q1 2021.
The bank’s robust customer acquisition strategy and the effectiveness of its electronic platforms and digital channels enabled it to deliver a N54 billion increment in the savings account balance, which is solely retail. Customer deposits grew by 6 percent from N5.34 trillion in December 2020 to N5.68 trillion in March 2021. Transactions on electronic channels also grew astoundingly as new customers continue to be attracted to the Bank’s various user-friendly digital platforms.
Going forward in 2021, the bank expects that the ongoing economic recovery and improvements in the yield environment will translate into improved numbers for the Group. This is expected to be supported by local and international COVID-19 vaccination campaigns, rising commodity prices, and global economic growth of up to 6 percent , as estimated by the International Monetary Fund (IMF). The Group will continue to position itself to take advantage of positive developments in the domestic and global economy to deliver improved financial performance and returns to all its stakeholders.
In March 2021 Shareholders of Zenith Bank unanimously approved the proposed final dividend of N2.70 per share, bringing the total dividend payment for the 2020 financial year to N3.00 per share with a total value of N94.19 billion.
The shareholders made the approval at the 30th Annual General Meeting of the Bank held in Lagos. This followed the recent release of the Bank’s audited financial results for the 2020 financial year.
According to the audited financial results, profit before tax (PBT) rose by 5 percent to N255.9 billion from N243.3 billion reported in the previous year despite a challenging macro-economic environment exacerbated by the COVID 19 pandemic.
The increase arose from a mixture of growth in the top line and a significant reduction in interest expense from N148.5 billion in 2019 to N121.1 billion in 2020, significantly increasing the net interest income from NGN267.0 billion in 2019 to N299.7 billion in 2020.
The Group recorded a growth in gross earnings of 5% from N662.3 billion in the previous year to N696.5 billion. The Group recorded 8 percent growth in non-interest income from N232.1 billion in 2019 to N251.7 billion in 2020 and a 1% increase in interest income from N415.6 billion in 2019 to N420.8 billion in 2020.
