Shareholders of Zenith Bank Plc Tuesday approved the final dividend of N2.70 per share, bringing the total dividend payment for the 2020 financial year to N3.00 per share with a total value of N94.19 billion.
This followed the recent release of the Bank’s audited financial results for the 2020 financial year.
The shareholders who gave the approval at the Bank’s 30th Annual General Meeting (AGM) held at the Civic Centre, Victoria Island, Lagos, also commended the board and management of the bank for a sustained and consistent dividend payment at end of every financial year.
They however, thanked the bank for adhering strictly to the principle of corporate governance, adding that the bank’s Corporate Social Responsibility (CRS), is second to none.
Speaking at the meeting, National Leader Emeritus, Independent Shareholders Association of Nigeria, Sir Sunny Nwosu said that Zenith Bank has been a source of inspiration and a good partner to shareholders.
He thanked the management of the bank for putting smiles on the faces of shareholders.
Another shareholder activist, Alhaji Umar Farouk maintained that Zenith Bank has done very well, in terms of dividend payout and regional diversification.
From the audited financial results, the Group recorded a year-on-year growth of 10per cent in Profit After Tax (PAT) from N208.8 billion recorded in 2019 to N230.7 billion. This is despite a challenging macroeconomic environment exacerbated by the COVID–19 pandemic.
The Group also recorded a growth in gross earnings of 5per cent from N662.3 billion in the previous year to N696.5 billion.
Also, the Group recorded 8per cent growth in non-interest income from N232.1 billion in 2019 to N251.7 billion in 2020 and a one per cent increase in interest income from N415.6 billion in 2019 to N420.8 billion in 2020.
Profit Before Tax (PBT) equally increased by 5per cent, growing from N243.3 billion in 2019 to N255.9 billion in the current year.
The increase arose from a combination of growth in the topline and a significant reduction in interest expense. Interest expense reduced from N148.5 billion in 2019 to N121.1 billion in 2020, significantly increasing the net interest income from N267.0 billion in 2019 to N299.7 billion in 2020.
The Group’s increased retail activities translated to a corresponding increase in retail deposits and loans. Thus, retail deposits grew by N612.7 billion from N1.11 trillion to N1.72 trillion Year-on-Year (YoY), while savings balances significantly grew by 88per cent YoY and closed at N1.16 trillion.
This retail drive, coupled with the low-interest yield environment, helped reduce the cost of funding from 3.0per cent to 2.1per cent and reduced interest expense.
However, the low-interest environment also affected the net interest margin, which declined from 8.2per cent to 7.9per cent in the current year due to the re-pricing of interest-bearing assets. Operating costs grew by 10per cent YoY but are still tracking well below inflation which at the end of the year stood at 15.75per cent.
Although returns on equity and assets also reduced from 23.8per cent to 22.4per cent and from 3.4per cent to 3.1per cent, respectively, the Group still delivered improved Earnings per Share (EPS), which grew 10per cent from N6.65 to N7.34 in the current year.
The Group also increased corporate customer deposits, which alongside the growth in retail deposits, delivered total deposit growth of 25per cent, to close at N5.34 trillion, driving growth in market share.
Total assets also increased significantly by 34per cent, from N6.35 trillion to N8.48 trillion. Despite the COVID-19 pandemic and its associated challenges, the Group created new viable risk assets as gross loans grew by 19per cent, from N2.46 trillion to N2.92 trillion.
This was achieved while maintaining a stable and low overall NPL ratio of 4.29per cent (2019: 4.3per cent) across the entire portfolio and an increase in the cost of risk from 1.1per cent to 1.5per cent, reflecting the elevated risk environment in 2020. The Group recorded impressive liquidity and capital adequacy ratios of 66.2per cent and 23.0per cent and remained above regulatory thresholds of 30per cent and 15per cent, respectively.
As a testament to this superlative performance and in recognition of its track record of excellent performance, Zenith Bank was voted as Bank of the Year (Nigeria) in The Banker’s Bank of the Year Awards 2020, Best Bank in Nigeria in the Global Finance World’s Best Banks Awards 2020 and Best Corporate Governance ‘Financial Services’ Africa 2020 by the Ethical Boardroom.
Also, the bank emerged as the Most Valuable Banking Brand in Nigeria, for the fourth consecutive year, in the Banker Magazine “Top 500 Banking Brands 2021” and Number One Bank in Nigeria by Tier-1 Capital in the “2020 Top 1000 World Banks” Ranking published by The Banker Magazine.
Similarly, the bank was recognised as Bank of the Decade (People’s Choice) at the ThisDay Awards 2020, Retail Bank of the year at the 2020 BusinessDay Banks and Other Financial Institutions (BOFI) Awards, and Best Company in Promotion of Good Health and Well-Being as well as Best Company in Promotion of Gender Equality and Women Empowerment at the Sustainability, Enterprise and Responsibility (SERAS) Awards 2020.
