First Bank

Saturday, April 1, 2023

Zenith Bank’s Gross Earnings Rises By 24% To N945.5 Billion In 2022

Zenith Bank Plc has announced its audited results for the year ending December 31, 2022,achieving an impressive double-digit growth of  24%  in gross earnings from NGN765.6billion  reported   in   the   previous  year   to   NGN945.5   billion   in   2022.   This   is   despite  thepersistent challenging macroeconomic environment and headwinds.

According to  the   audited financial   results   for  the  2022  financial  year  presented to  theNigerian Exchange (NGX), the double-digit growth in gross earnings was driven by a 26%year-on-year (YoY) growth in interest income from NGN427.6 billion to N540.2 billion and a23% year-on-year (YoY) growth in non-interest income from NGN309 billion to NGN381billion. Profit before tax also grew by 2% from NGN280.4 billion to NGN284.7 billion in thecurrent year. The increase in profit before tax was due to the significant growth in all theincome lines.Impairments   grew   by   107%   from   NGN59.9   billion   to   NGN124.2   billion,   while   interestexpense grew 63% YoY from N106.8 billion to N173.5 billion, respectively. 

The impairmentgrowth, which also resulted in an increase in the cost of risk (from 1.9% in 2021 to 3.3% inthe   current   year),   was   due   to   the   impact   of   Ghana's   sovereign   debt   restructuringprogramme. The growth in interest expense increased the cost of funds from 1.5% in 2021to 1.9% in 2022 due to hikes in interest rates globally. Customer deposits increased by 39%, growing from NGN6.47 trillion in the previous year toNGN8.98   trillion  in  the   current   year.   The  growth   in   customer   deposits   came   from   allproducts and deposit segments (corporate and retail), thus consolidating the bank’s marketleadership and indicating customers' trust. 

The   continued   elevated   yield   environment   positively   impacted  the   bank’s   Net-Interest-Margin (NIM), which grew from 6.7% to 7.2% due to an effective repricing of interest-bearing assets. Operating expenses grew by 17% YoY, but growth remains below theinflation rate. Total assets increased by 30%, growing from NGN9.45 trillion in 2021 toNGN12.29  trillion,  mainly driven   by growth  in  customer  deposits.   With  the  steady   andcontinued recovery in economic activities, the Group prudently grew its gross loans by 20%,from NGN3.5 trillion in 2021 to NGN4.1 trillion in 2022, which increased the Non-PerformingLoan (NPL) ratio modestly from 4.2% to 4.3% YoY. The capital adequacy ratio decreasedfrom 21% to 19%, while the liquidity ratio improved from 71.2% to 75%. Both prudentialratios are well above regulatory thresholds.

In 2023, the Group intends to expand its frontiers as it also reorganises into a holdingcompany structure, adding new verticals to its businesses and growing in all its chosenmarkets, both locally and internationally.As a testament to its commitment to shareholders, the bank has announced a proposedfinal dividend payout of N2.90 per share, bringing the total dividend to N3.20 per share. 

In recognition of its track record of excellent performances, Zenith Bank was recognised asthe Number One Bank in Nigeria by Tier-1 Capital, for the 13th consecutive year, in the2022 Top 1000 World Banks Ranking published by The Banker Magazine; Bank of the Year(Nigeria) in The Banker's Bank of the Year Awards 2020 and 2022; Best Bank in Nigeria, forthree consecutive years from 2020 to 2022, in the Global Finance World's Best BanksAwards; Best Commercial Bank, Nigeria 2021 and 2022 in the World Finance BankingAwards;   Best   Corporate   Governance   Bank,   Nigeria   in   the   World   Finance   CorporateGovernance Awards 2022; Best in Corporate Governance' Financial Services' Africa, forthree consecutive years from 2020 to 2022, by the Ethical Boardroom; Best CommercialBank, Nigeria and Best Innovation In Retail Banking, Nigeria in the International Banker2022 Banking Awards. Also, the bank emerged as the Most Valuable Banking Brand inNigeria in the Banker Magazine Top 500 Banking Brands 2020 and 2021, and Retail Bankof the year, for three consecutive years from 2020 to 2022, at the BusinessDay Banks andOther Financial Institutions (BAFI) Awards. Similarly, Zenith Bank was named as Bank ofthe Decade (People's Choice) at the ThisDay Awards 2020, Most Innovative Bank of theYear 2019 by Tribune Newspaper, Bank of the Year 2020 by Independent Newspaper,Bank of the Year 2021 by Champion Newspaper, Bank of the Year 2022 by New TelegraphNewspaper, and Most Responsible Organisation in Africa 2021 by SERAS Awards.

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