Zenith Bank, Nigeria’s tier-one lender has beat earning volatility to post 17 per cent revenue growth of N405bn from N304bn, driven by record surge in interest income.
From a profit of N117bn in June last year, the bank saw an 11 per cent leap in its half year profit ending June 2022 to a record N130bn.
Zenith made the disclosure in its half year financial report.
The lender said the increase was propelled by a 19 per cent growth in interest income from N204bn in June 2021 to N242bn.
The half year result success was also linked to an 18 per cent surge in non-interest income which rose from N127bn to N149bn annualised.
The positives posted by the first-tier lender dragged its Earnings per share (EPS) up from N3.38 to N3.55 over the 6-month period.
“The growth in interest income was driven by the modest increase in the loan book and improved interest margins. The increase in non-interest income attests to the Group’s success in its income diversification strategy,” the lender revealed.
Zenith witnessed an increase in deposits from its customers as the amount surged 11 per cent N7.15trn, from N6.47trn recorded last December.
The results revealed that deposits from retail customers was up 17 per cent from N1.82trn to N2.13trn, a growth attributed to the Group’s retail strategy.
The lender’s asset base grew to N10.12trn at the end of June 2022 from N9.45trn recorded in December 2021.
According to the lender, retail activities supported the growth recorded in fees on electronic products which grew by 45 per cent in one year from N17bn in June 2021 to N25bn in June 2022.
Despite difficulties posed by the operating environment, the Group “grew its risk assets as gross loans grew by 5 per cent YtD, from N3.5trn to N3.7trn. This was achieved at a moderate NPL ratio of 4.4 per cent (FYE 2021: 4.2 per cent) and cost of risk of 1.4 per cent (June 2021: 1.3 per cent).
“Prudential ratios such as liquidity and capital adequacy also remained stable and well-above regulatory thresholds at 60.5 per cent and 21.0 per cent respectively.”
Zenith Bank is also seeking to leverage on its digital banking strategy to advance market penetration gained in previous years.
The lender disclosed it “is focused on advancing its digital banking strategy anchored on a strong technology base, and intends to consolidate on the gains achieved in prior years across all business segments. Combined with the Group’s industry leadership, we expect this to drive improved performance and deliver enhanced returns to stakeholders.”