Zenith Bank has announced its result for the year ended December 31, 2019, with profit after tax of N208.8 billion, achieving the feat as the first Nigerian Bank to cross the N200 billion mark. According to the bank’s audited financial results for the 2019 financial year released in Lagos on Friday, profit after tax rose by 8eight per cent to N208.8 billion from the N193 billion recorded in the previous year. The group also recorded a growth in gross earnings of five per cent rising to N662.3 billion from N630.3 billion reported in the previous year.
This growth was driven by the 29 per cent increase in non-interest income from N179.9 billion in 2018 to N231.1 billion in 2019. Fees on electronic products continues to grow significantly with a 108 per cent Year on Year (YoY) growth from N20.4 billion in 2018 to N42.5 billion in the current year.
This is a validation of the bank’s retail transformation strategy which continues to deliver impressive results. Profit before tax also increased by 5 per cent growing from N232 billion to N243 billion in the current year, arising from topline growth and continued focus on cost optimisation strategies. Cost-toincome ratio moderated from 49.3 per cent to 48.8 per cent.
The drive for cheaper retail deposits coupled with the low interest yield environment helped reduce the cost of funding from 3.1 per cent to 3.0 per cent.
However, this also affected net interest margin, which reduced from 8.9 per cent to 8.2 per cent in the current year due to re-pricing of interest bearing assets. Although returns on equity and assets held steady YoY at 23.8 per cent and 3.4 per cent respectively, the group still delivered an improved Earnings per Share (EPS) which grew eight per cent from N6.15 to N6.65 in the current year.
The group increased its share of the market as it secured increased customer deposits across the corporate and retail space as deposits grew by 15 per cent to close at N4.26 trillion. Total assets also increased by seven per cent from N5.96 trillion to N6.35 trillion.
The group created new viable risk assets as gross loans grew by 22 per cent from N2.016 trillion to N2.462 trillion. This was executed prudently at a low cost of risk of 1.1 per cent and a significant reduction in the non-performing loan ratio from 4.98 per cent to 4.30 per cent. Prudential ratios such as liquidity and capital adequacy ratios also remained above regulatory thresholds at 57.3 per cent and 22.0 per cent respectively. In demonstration of its commitment to its shareholders, the bank has announced a proposed final dividend pay-out of N2.50 per share, bringing the total dividend to N2.80 per share.