Zenith Bank Plc has announced an impressive display of resilience in its audited results for the half-year ended 30 June 2023. The bank recorded an astounding triple-digit growth of 139% in gross earnings from N404.8 billion reported in H1 2022 to N967.3 billion in H1 2023. This is a clear demonstration of its resilience and strong market share despite a very challenging macroeconomic environment and persistent headwinds.
According to the bank’s audited half-year financial results presented to the Nigerian Exchange (NGX) on Monday, 11th September 2023, the triple-digit growth in the top line also spurred the bottom line as the Group recorded a 169% Year on Year (YoY) increase in profit before tax, growing from N130 billion in H1 2022 to N350.4 billion in H1 2023. Profit after tax also grew by triple digits, growing by 162% from N111.4 billion to N291.7 billion in the same period.
The growth in gross earnings arose from both interest income and non-interest income. Interest income grew by 72% from N241.7 billion in H1 2022 to N415.4 billion in H1 2023, while non-interest income grew by 246% from N149 billion to N515.7 billion. The growth in interest income is attributed to the impact of both the growth and repricing of risk assets. The liberalization of the foreign exchange market during the period spurred the growth in non-interest income as revaluations gains improved significantly.
In terms of efficiency, cost-to-income ratio improved from 58% to 38.5% in the current period on the back of an enhanced income line. The liberalization of the foreign exchange market coupled with the heightened risk environment resulted in cost of risk growing from 1.4% to 8.8%. Cost of funding also grew YoY from 1.4% in H1 2022 to 2.6% in H1 2023 because of the spike in interest rates between both periods as interest expense grew from N57 billion in H1 2022 to N153.6 billion in H1 2023.
Total assets grew by 31% from N12.3 trillion to N16.0 trillion in December 2022, mainly driven by growth in customers’ deposits and the devaluation of the local currency. Customers’ deposits grew by 30% from N9.0 trillion in December 2022 to N11.6 trillion in June 2023.
Loans and advances also grew by 32% from N4.12 trillion in December 2022 to N5.38 trillion in June 2023 partly due to the revaluation of the foreign currency denominated loans as well as growth in local currency loans. Non-performing loans ratio improved from 4.3% to 3.9% in December 2022 despite the deterioration of the macros and heightened risk environment because of the currency mix of risk assets. Capital adequacy ratio improved from 19.8% to 22.0%, while liquidity ratio reduced from 75% to 61% in the current period. Both prudential ratios are still well above regulatory thresholds.
The reorganisation into a holding company structure has advanced, as the Group adds new verticals to its businesses and expand into new frontiers. As the year progresses, the Group will continue to remain dynamic in anticipating and responding to the changes in the fiscal and monetary environments in order to sustain growth across all its business segments and markets.
Zenith Bank’s track record of excellent performance has continued to earn the brand numerous awards including being recognised as the Number One Bank in Nigeria by Tier-1 Capital, for the 14th consecutive year, in the 2023 Top 1000 World Banks Ranking published by The Banker Magazine; Best Commercial Bank, Nigeria, for three consecutive years from 2021 to 2023, in the World Finance Banking Awards; Best Corporate Governance Bank, Nigeria in the World Finance Corporate Governance Awards 2022 and 2023; Bank of the Year (Nigeria) in The Banker’s Bank of the Year Awards 2020 and 2022; Best Bank in Nigeria, for three consecutive years from 2020 to 2022, in the Global Finance World’s Best Banks Awards; Best in Corporate Governance’ Financial Services’ Africa, for four successive years from 2020 to 2023, by the Ethical Boardroom; Most Sustainable Bank, Nigeria in the International Banker 2023 Banking Awards; Best Commercial Bank, Nigeria and Best Innovation In Retail Banking, Nigeria in the International Banker 2022 Banking Awards.
Also, the bank emerged as the Most Valuable Banking Brand in Nigeria in the Banker Magazine Top 500 Banking Brands 2020 and 2021 and Retail Bank of the Year, for three consecutive years from 2020 to 2022, at the BusinessDay Banks and Other Financial Institutions (BAFI) Awards. Similarly, Zenith Bank was named Bank of the Decade (People’s Choice) at the ThisDay Awards 2020, Bank of the Year 2021 by Champion Newspaper, Bank of the Year 2022 by New Telegraph Newspaper, and Most Responsible Organisation in Africa 2021 by SERAS Awards.