Zenith Bank Plc has announced its unaudited results for the first quarter ended 31st
March 2024, with an impressive triple-digit growth of 189% in Gross Earnings, from
₦270 billion reported in Q1 2023 to ₦781 billion in Q1 2024. This is despite the
challenging operating environment and tightening monetary policy stance.
From the unaudited statement of account submitted to the Nigerian Exchange (NGX) on
Friday, 3rd May 2024, this impressive growth in the topline also enhanced the bottom
line, as profit before tax (PBT) rose to ₦320 billion in Q1 2024, representing an increase
of 270% from the ₦87 billion reported in Q1 2023. Profit after tax (PAT) equally grew
significantly by 291% from the ₦66 billion reported in Q1 2023 to ₦258 billion in the
current period.
Interest and non-interest income contributed significantly to the growth in gross earnings.
Interest income grew by 155% from the ₦192 billion reported in the quarter ended
March 2023 to ₦489 billion in the period to 31 March 2024. The growth in interest
income is due to the repricing of risk assets, owing to the increase in the central bank’s
Monetary Policy Rate (MPR), which currently stands at 24.75%. The growth in net
interest income is primarily due to the increase in fees and commissions as well as
trading grains.
The Group reported an impairment charge of ₦56 billion for Q1 2024, up from ₦8 billion
recorded in Q1 2023. This is attributable to significant growth in risk assets, primarily
driven by the revaluation of its USD loans, which necessitated additional impairment on
the bank’s foreign currency-denominated loans.
The cost of funds grew by 48% from 2.7% in Q1 2023 to 4% in Q1 2024 due to the high-
interest rate environment, while interest expense increased by 157% from ₦71 billion
reported in Q1 2023 to ₦182 billion in the period to March 2024. Notwithstanding the
year-on-year (YoY) increase in interest expense, net interest margin (NIM) grew by 20%
from 6.9% in the 3 months ended March 2023 to 8.3% in the current period ending 31
March 2024. Return on Average Equity (ROAE) and Return on Average Assets (ROAA)
increased year-on-year (YoY) by 114% and 119%, respectively, due to improved
profitability.
Gross loans, which are largely funded by customer deposits, grew by 30% from ₦7.1
trillion in December 2023 to ₦9.2 trillion in March 2024. Customer deposits also grew by
11% from ₦15.2 trillion in December 2023 to ₦16.8 trillion in March 2024, underpinning
continued customer confidence in the Zenith brand. Total assets increased by 19% to
₦24 trillion within the same period.
The Group has consistently maintained all prudential ratios well above the minimum
regulatory requirement. At the end of Q1 2024, Capital Adequacy Ratio (CAR) and
Liquidity Ratio stood at 20% and 67%, respectively, demonstrating the Group’s ability to
maintain a strong and liquid balance sheet.
The Group is making progress on the planned capital raise to support future growth and
is very optimistic about meeting the new minimum capital requirements in line with the
CBN’s recapitalisation directive. As the Group accelerates migration to its new
technology architecture and also transitions into a holding company, it remains poised to
maximise value for all stakeholders.