Zenith Bank Plc has announced its audited results for the half-year ended June 30, 2024, recording a growth of 117 per cent in gross earnings from N967.3 billion reported in H1 2023 to N2.1 trillion.

This performance, according to a statement made available to The Guardian, yesterday, is despite the Nigerian banking industry’s challenging macro environment.

According to the bank’s audited half-year financial results presented to the Nigerian Exchange (NGX) on Friday, August 30, 2024, the triple-digit growth in the top line also drove growth in the bottom line as the group recorded a 108 per cent Year-on-Year (YoY) increase in Profit Before Tax (PBT), from N350 billion in H1 2023 to N727 billion in H1 2024.

Profit After Tax (PAT) also grew by 98 per cent from N292 billion to N578 billion in the same period. This led to growth in Earnings Per Share (EPS) by 98 per cent from N9.29 in H1 2023 to N18.41 in the period under review.

The growth in gross earnings was driven by acceleration in both interest income and non-interest income. Propelled by the growth and effective pricing of risk assets, interest income surpassed the N1 trillion mark, a half-year record, growing by 177 per cent from N415.4 billion in H1 2023 to N1.1 trillion in H1 2024, while non-interest income grew by 74 per cent from N515.7 billion to N899.3 billion.

The group continued to strive for operational efficiency, resulting in only a marginal increase in cost-to-income ratio YoY from 38.5 per cent to 39.4 per cent. The heightened risk environment has fuelled a growth in impairment levels, thus mildly elevating the cost of risk from 8.8 per cent to 9.7 per cent.

Cost of funds grew YoY from 2.6 per cent to 4.4 per cent given the high interest rate environment. This also resulted in growth in interest expense from N153.6 billion in H1 2023 to N434.4 billion in H1 2024.

Despite this, net interest margin grew by 49 per cent from 5.9 per cent in H1 2023 to 8.8 per cent in H1 2024, underscoring the efficient re-pricing of interest earning assets and interest accruing liabilities.

Total assets grew by 35 per cent from N20.4 trillion in December 2023 to N27.6 trillion in June 2024, while customer deposits grew by 29 per cent from N15.2 trillion in December 2023 to N19.6 trillion in June 2024. Gross loans also grew by 44 per cent from N7.1 trillion in December 2023 to N10.2 trillion in June 2024 aided by loans disbursements to customers and the translation effect of foreign currency denominated loans.

The group’s consistent stringent risk acceptance criteria helped ensure that the non-performing loan (NPL) ratio continued to show only modest growth, increasing from 4.4 per cent in December 2023 to 4.5 per cent in June 2024 despite the challenging macroeconomic environment.

Capital adequacy ratio improved from 21.7 per cent in December 2023 to 23 per cent in June 2024, loan-to-deposit ratio grew by 11 per cent from 46.5 per cent to 51.7 per cent, while liquidity ratio reduced from 71 per cent to 59 per cent in the current period. All prudential ratios are still well above regulatory thresholds.

In maximising value to its highly esteemed shareholders, the group has declared an interim dividend of N1.00 per share. This represents the highest half year dividend pay-out in its history, and also the highest interim dividend in the Nigerian banking sector till date.

Zenith’s strong brand equity and excellent service quality position it to mine new business opportunities in strategic sectors of the economy, in existing geographies where it has a presence, and in new geographies it is exploring. In furtherance of its expansion plans, it received regulatory approval for the establishment of a third-country branch in Paris, France, which, when fully operational, will enhance its product offerings in international markets.

The group will continue to invest in enhancing its digital banking capabilities and is expediting the completion of its technology infrastructure upgrade. Its track record of successful capital raises puts it on a solid footing to meet the new minimum capital requirements for commercial banks with international authorisation, well ahead of the deadline set by the Central Bank of Nigeria (CBN). It remains undoubtedly on track for a record year in its financial performance and will continue to deliver maximum value to its shareholders, while ensuring a strong corporate governance culture.