Established in May 1990, Zenith Bank Plc, one of the leading Deposit Money Banks (DMB) and the Most Valuable Banking Brand in Nigeria has been at the forefront of supporting growth of the nation’s economy through its targeted products.
Looking at the bank’s milestones since inception, industry watcher are of the view that the its policies have been steadily progressing, from the first Managing Director and now chairman of the bank, Mr. Jim Ovia, management and workforce,
They equally maintained that the founding fathers of the bank had put in place a blueprint that had been strictly followed with needed proactive modifications to achieve desired results and adequate returns on investment.
Also, in the last thirty one years, it is on record that Zenith Bank Plc has been active in supporting Small and Medium Scale Enterprises (SMEs), customers, schools, communities, among others.
Interestingly, the federal government’s Agri-Business, Small and Medium Enterprises Investment Scheme (AGSMEIS) Scheme has enabled Zenith Bank give many businesses the opportunity to access low interest loans in form of debt or equity.
AGSMEIS is a scheme that promotes agricultural businesses, Micro, Small, Medium Enterprises (MSMEs) thereby creating an avenue for improved employment generation and sustainable economic development.
Zenith Bank Plc is a large and efficient financial service provider in Nigeria and Anglophone West Africa and it is licensed as a commercial bank by the Central Bank of Nigeria (CBN), the national banking regulator.
Also, as part of the strategies to support and empower its customers, the bank last year commenced its ‘Zenith Beta Life’ Promo to reward customers of the bank with gifts every week starting from Friday July 31st, 2020, to July 30th, 2021.
According to the bank, during the period, 50 customers would be selected via raffle draw each week and rewarded with gifts worth N30,000. This has continued despite the harsh operating economic environment in the country.
It has over the years been recognized as one of the most customer-focused financial institutions in the country and was voted the most customer-focused bank in Nigeria for the retail and Small and Medium scale Enterprises (SMEs) segments in the 2018 KPMG Annual Banking Industry Customer Satisfaction Survey (BICSS).
The bank, according to industry watchers, has clearly distinguished itself in the Nigerian financial services industry through superior service quality, unique customer experience and sound financial indices.
As of 31 December 2019, it held $16.1billion in total assets, with shareholders’ equity of $854 million.
At inception, Zenith Bank had a capital base of $4 million and began operations during a period of government liberalization of the banking sector when the Central Bank of Nigeria, CBN granted up to 20 banking licenses a year to investors.
The bank’s first office was originally a residential house in Victoria Island that was modified into a banking hall. In its early years, the bank witnessed a period of rapid growth. In 1997, following a directive for banking institutions to shore up their capital base, Zenith increased its capitalization to N500 million.
The Nigerian banking industry of the early 1990s was led by a select group of four major banks, namely Union Bank, First Bank, UBA and the defunct Afribank.
In 1999, Zenith Bank embraced the use of the internet for marketing of financial services and to promote the use of online banking by customers thus becoming one of the earliest companies to invest in online banking.
Also in the early 2000s, Zenith’s profile began to rise, its investments in information technology helped it compete against the major banks that had a larger branch outreach and it soon began to announce net profits comparable to some of the first generation big banks.
On June 17, 2004, following a successful Initial Public Offer (IPO), the bank became a public limited company and on 21 October 2004 its shares of stock were listed on the Nigerian Stock Exchange (NSE).
The bank’s shares are also traded on the London Stock Exchange (LSE) following a listing of the $850 million worth of its shares at $6.80 each, in 2013.
The bank has equity investments in Zenith Custodian, Zenith Securities and Zenith General Insurance, and has more than 500 branches and business offices in all states and the Federal Capital Territory (FCT).
Zenith Bank Plc maintains subsidiaries in the United Kingdom, United Arab Emirates, Ghana, Sierra Leone and The Gambia. The Bank also has an office in China.
Speaking with Daily Champion, on the phenomenal growth of the financial institution, a Shareholder Activist & Cofounder NOBLE Shareholders Solidarity Association (NSSA) Alhaji Gbadebo Olatokunbo who rated the bank’s performances over the decades very highly said, he is not surprised about Zenith Bank’s long standing support towards businesses and economic development of the country, adding that the feats of the bank in the sector has been encouraging and profound.
As a shareholder of the bank, he said “The foundation for sustainability and progress in Zenith Bank was incorporated into its vision/mission, and you have to be on that track to be the Managing Director of the bank.
“And since the records were kept, each Managing Director would work to progress further from year to year, in order to establish the progressive nature of the bank.
“Many years ago, when the founding fathers of Zenith Bank were visualizing the vision/mission for the bank, one thing was upper most on their minds and it was that of progressive-longevity, which led to several earlier decisions and policies on vision, mission, focus, goals and the quality of staff to be employed with the succession plans for the future.
“Due to the above submission, when Jim Ovia was heading the bank, he was also absorbing the best amongst the very best into the bank, while serious engagements on what the bank stood for, its core values were injected into those recruited; in order to be able to meet the envisaged track record planned for the bank.
“It is in the system of the bank to make progress year in year out, and to remain focused, in-order to achieve the desired results on progression,” he said.
Also speaking, National Coordinator, Progressive Shareholders Association of Nigeria (PSAN),Boniface Okezie maintained that Zenith Bank has been at the forefront in dividend payout to shareholders over the years.
While describing Zenith Bank’s service delivery as excellent, he said, “we are indeed happy with management, board and the entire workforce of the bank for the numerous achievements and support to the Nigerian economy.
The Board of Directors of Zenith Bank had last month met to discuss the audited financial statements for the year ended December 31, 2020.
The board also considered a final dividend for the year, having paid an interim dividend of 30 kobo per share last year.
According to the financial institution, audited results would only be published after relevant regulatory approval.
Zenith Bank had at the end of the 2019 financial year paid a final dividend of N2.50 per share, bringing the total dividend payment for the 2019 financial year to N2.80 per share with a total value of N87.9 billion.
According to the audited financial results for the 2019 financial year, Zenith Bank recorded a Profit After Tax (PAT) of N208.8 billion, an increase of 8per cent from the N193 billion recorded in the previous year, thus achieving the feat as the first Nigerian bank to cross the N200 billion mark.
The Group also recorded a growth in gross earnings of 5per cent rising to N662.3 billion from N630.3 billion reported in the previous year. This growth was driven by the 29per cent increase in non-interest income from N179.9 billion in 2018 to N231.1 billion in 2019.
Fees on electronic products continue to grow significantly with a 108per cent Year on Year (Y-o-Y) growth from N20.4 billion in 2018 to N42.5 billion in the current year. This is a validation of the bank’s retail transformation strategy which continues to deliver impressive results.
Profit before tax also increased by 5per cent growing from N232 billion to N243 billion in the current year, arising from topline growth and continued focus on cost optimization strategies. Cost-to-income ratio moderated from 49.3per cent to 48.8per cent.
The drive for cheaper retail deposits coupled with the low-interest yield environment helped reduce the cost of funding from 3.1per cent to 3.0per cent. However, this also affected net interest margin, which reduced from 8.9per cent to 8.2per cent in the current year due to re-pricing of interest-bearing assets.
Although returns on equity and assets held steady YoY at 23.8per cent and 3.4per cent respectively, the Group still delivered an improved Earnings per Share (EPS) which grew 8per cent from N6.15 to N6.65 in the current year.
The Group in 2019 increased its share of the market as it secured increased customer deposits across the corporate and retail space as deposits grew by 15per cent to close at N4.26 trillion. Total assets also increased by 7per cent from N5.96 trillion to N6.35 trillion.
The Group created new viable risk assets as gross loans grew by 22per cent from N2.016 trillion to N2.462 trillion. This was executed prudently at a low cost of risk of 1.1per cent and a significant reduction in the non-performing loan ratio from 4.98per cent to 4.30per cent. Prudential ratios such as liquidity and capital adequacy ratios also remained above regulatory thresholds at 57.3per cent and 22.0per cent respectively.
Given its impressive performances, financial analysts were unanimous that Zenith Bank’s emergence as the Most Valuable Banking Brand in Nigeria in the recently released Banker Magazine Top 500 Banking Brands 2020 assessment is justified and expressed confidence that members of the current management of the bank led by the Group Managing Director/Chief Executive Officer, Mr. Ebenezer Onyeangwu have the capacity to take the financial institution to greater heights in the months and years ahead to the satisfaction of customers and shareholders.
Zenith Bank offers specialized financial services such as Pension Management but would discontinue services in Insurance, Capital Market dealings, Trusteeship, Registrar, Mortgage and financial advisory services in line with its decision to adopt the commercial banking license with international authorisation. Its core businesses include: Corporate and Investment Banking, Commercial and Consumer Banking, Personal and Private Banking, Trade Services and Foreign Exchange, Treasury and Cash Management Services, Other Non-Bank Financial Services mainly through subsidiaries, Superior Service Quality
The bank has clearly distinguished itself in the banking industry through superior service quality, unique customer experience, and sound financial indices. These have become part of its corporate culture to the extent that the bank is easily associated with the following attributes; Best-in-class customer experience, creativity, excellent financial performance, good asset quality, stable management, dedicated and highly skilled work-force, cutting-edge Information and Communication Technology, ICT efficient and effective distribution channels.
The bank’s strategy of assessing and managing its impact on the industry forms an integral part of the strategic objective. Specifically, the bank considers how the present and future capital requirements will be met and managed in view of projected capital requirements based on its assessment and against the regulatory capital requirement.
Strategic Objective
The strategic objective of Zenith Bank also includes a continuous improvement of its capacity to meet customers’ increasing and dynamic financial needs as well as sustain high quality growth through investments that impact the quality of service to its ‘’existing and potential customers, constant upgrade of our ICT infrastructure, unwavering investment in training and re-training of our people and regular reinforcing of our Customer Services delivery charter with regards to continually changing customer needs.
“Zenith Bank places high premium on the pivotal role of Exceptional Service Delivery in our drive to consistently exceed expectations. The bank has in place a well-articulated strategy to not only meet and surpass customer expectation but also ensure that plans are fine-tuned to address the changing taste and sophistication of the customer.
“The underlying philosophy is for the bank to remain at all times, a Customer-centric institution with a clear understanding of its market and environment”.
Zenith Bank Corporate Governance
According to the bank, “We remain committed to promoting good corporate governance and best practices in the conduct of its business. This is because we believe that good Corporate Governance engender public trust and ultimately ensures that the company meets the expectation of all stakeholders”.
Endorsements & Recognitions
Zenith Bank’s impressive growth pattern and performance over the years have earned it excellent ratings, recognitions and endorsement from local and international agencies and institutions: The Banker Magazine, a publication of the Financial Times of London in a 2013 survey, rated Zenith as the Biggest bank in Nigeria by tier-1 capital.
In 2012, Zenith Bank was recognized as one of the 30 Outstanding Global Brands making sustainable impact on their operating environment. This recognition was a prelude to the United Nations Development Programme’s (UNDP) Conference on Sustainable Development (Rio+20) which held in Rio de Janeiro, Brazil in June 2012. KPMG rated Zenith Bank as the Best Customer-Focused Bank in Nigeria.
Corporate Performance
Within thirty one years, Zenith Bank has demonstrated rare resilience and has witnessed exponential growth in virtually all areas. Today, Zenith is undoubtedly one of Nigeria’s strongest financial services institutions and one of the country’s largest banks by market capitalization, shareholders fund and profitability.
The bank’s growth momentum has increased over time and impacted positively on its standing as a market leader. In essence, Zenith Bank continues to make remarkable success on the sustainability agenda which is at the heart of its strategic and business models. As a result, Zenith bank is better positioned to continue on its growth trajectory and our desire to be a vital part of people’s lives and businesses.
Excellent service delivery and development of superior asset quality, strong capital base, professionalism and corporate governance have provided the grounds for consistent high returns to stakeholders. The bank maintains sound risk management and corporate governance culture in line with global best practices. The bank’s liquidity profile remains very strong and our risk management practices give assurance that the profile will be sustained on the short-run and improved upon over time.
