Zenith Bank’s after-tax profit surged 202 percent to N676.9 billion last year from N223.9 billion in 2022.
The bank’s profit before tax increased to N796 billion from N284.7 billion as gross earnings jumped to N2.13 trillion from N945.6 billion.
“The increase in gross earnings is primarily due to growth in interest and non-interest income. Interest income increased by 112 percent from N540 billion in 2022 to N1.1 trillion in 2023,” the bank said in a statement.
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The bank’s non-interest income grew by 141 percent to N918.9 billion from N381 billion.
“The increase in interest income is attributed to the growth in the size of risk assets and their effective repricing, alongside the rise in the yield of other interest-bearing instruments over the year,” it said.
The lender said growth in non-interest income was driven by significant trading gains and an increase in gains from the revaluation of foreign currencies.
“The cost of funds grew from 1.9 percent in 2022 due to the high interest rate environment while interest expense increased by 135 percent from N173.5 billion in 2022 to N408.5 billion in 2023,” it said.
The bank said that notwithstanding the 32 percent growth in operating expenses in 2023, its cost-to-income ratio improved significantly from 54.4 percent in 2022 to 36.1 percent in 2023 due to improved top-line performance.
Return on average equity increased by 118 percent from 16.8 percent in 2022 to 36.6 percent in 2023, underpinned by improved gross earnings, as the group sought to deliver better shareholder returns.
Return on average assets also grew by 95 percent from 2.1 percent to 4.1 percent in the same period.
The bank said its group has continued to deepen its market leadership in key corporate and retail deposit segments as customer deposits increased by 69 percent from N9.0 trillion to N15.2 trillion in 2023.
The retail drive continues to yield dividends as retail deposits now constitute 46 percent of total deposits (compared to 44 percent in 2022) and grew by 77 percent from N3.97 trillion in 2022 to N7.04 trillion in 2023, also reinforcing increased customer confidence in the Zenith brand.
Total assets increased by 66 percent to N20.4 trillion in 2023 from N12.3 trillion in 2022, largely due to growth in total deposits and the revaluation of foreign currency deposits.
Gross loans grew by 71 percent from N4.1 trillion in 2022 to N7.1 trillion in 2023 due to the revaluation of foreign currency loans and the growth in local currency risk assets.
Non-performing loans ratio, which increased marginally from 4.3 percent to 4.4 percent despite the heightened risk environment and challenging operating environment, an attestation to the group’s resilience despite headwinds and a challenging macroeconomic environment.
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Also, the prudential ratios remain within regulatory thresholds, with the capital adequacy ratio and liquidity ratio at 21.7 percent and 71.0 percent, respectively, at the close of 2023.
As a demonstration of its commitment to shareholders, the bank has announced a proposed final dividend payout of N3.50 per share, bringing the total dividend to N4.00 per share.
In 2024, the bank said it will complete the transition to a holding company structure, which is anticipated to position it advantageously for exploring emerging opportunities in the Fintech space while bolstering its digital and retail banking initiatives. It is undertaking urgent necessary actions to meet the new minimum N500 billion equity capital requirement to maintain its international authorisation within the timeframe stipulated by the Central Bank of Nigeria, according to the statement.
Zenith Bank stated that this will strengthen its presence in key markets to continue positioning for sustainable growth and value addition for stakeholders.
