Zenith Bank Plc has announced its unaudited results for the third quarter ended 30 September 2022, recording a remarkable double-digit growth of 20per cent in gross earnings from N518.7 billion reported in Q3 2021 to N620.6 billion in Q3 2022.
This performance demonstrates the Group’s resilience against a challenging macroeconomic environment.
According to the unaudited account presented to the Nigerian Exchange (NGX), the growth in the topline was driven by interest and non-interest income growth.
Interest income grew by 27per cent from N308.8 billion to N390.8 billion, driven majorly by growth in risk assets and an improvement in pricing.
This also strengthened Earnings Per Share (EPS) by 9per cent to N5.55.This double-digit growth in the topline also aided the bottom line, as the Group also recorded a 13per cent Year-on-Year (YoY) increase in Profit Before Tax, growing from N179.8 billion in Q3 2021 to N202.5 billion in Q3 2022.
Profit After Tax (PAT) equally grew by 9per cent from N160.6 billion to N174.3 billion in the same period.
Growth in non-interest income was enabled by the Group’s retail strategy, with continued substantial customer acquisition driving transactions, deposit growth and growth in electronic banking income.
Due to inflationary pressure and the rising cost of doing business, operating costs grew by 17per cent.
However, this was below the growth in gross earnings (20per cent), thereby facilitating the double-digit growth in the bottom line.
The continuing elevated yield environment affected the cost of funding which increased from 1.4per cent to 1.7per cent in the current period.
This affected the Net Interest Margin (NIM), which dropped due to the immediate implementation of higher yields on interest-bearing liabilities. However, the NIM is expected to see a correction in subsequent quarters as the assets side is repriced correspondingly.
Total assets grew by 20per cent from N9.45 trillion to N11.34 trillion in 2022, mainly driven by growth in customers’ deposits.
Customer deposits grew by 24per cent from N6.47 trillion in December 2021 to NGN8.04 trillion in September 2022 due to the market’s confidence in the brand.
Loans and advances also grew by 16per cent from N3.5 trillion in December 2021 to N4.06 trillion in September 2022, boosting the Group’s interest income and displaying the Group’s appetite for high-yielding risk assets creation.
As a result of this growth, the capital adequacy ratio reduced from 21per cent to 19.1per cent, while the liquidity ratio reduced from 71.6per cent to 68.9per cent .
Both prudential ratios remain very strong and are still well above regulatory thresholds.
In the year’s final quarter, management is determined to sustain the strong performance trajectory while adapting to changes in the regulatory environment and focusing on creative initiatives to mitigate inflationary trends, foreign exchange pressures and the growing competitive environment.
