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Zenith Bank declares N33.128bn pre-tax profit

By BusinessNews Staff on April 22, 2015

Zenith Bank Plc on Monday released its unaudited results for the three months ended March 31, 2015, declaring a profit before tax of N33.128bn for the period.

The figure is 15 per cent higher than the N28.919bn profit before tax it posted for the corresponding period of 2014.

The results, which showed that the bank grew its gross earnings by 20 per cent from N94.324bn to N113.322bn, also showed that it recorded a 17 per cent growth in profit after tax year-on-year.

Specifically, the bank’s profit after tax rose from N23.677bn, which it declared for the first quarter of 2014, to N27.680bn in the review period, while its basic and diluted earnings per share rose from 75 kobo to 88 kobo.

The bank’s interest income for the period was N81bn, compared with the N71bn it posted in the similar period of 2014 translating to a 14 per cent increase, while its non-interest income appreciated by 39.5 per cent to N31.9bn from N22.9bn in 2014. The operating income rose to N72bn, compared to N66bn in the same period of 2014, while operating expenses increased by 4.8 per cent to N39bn from N37.6bn.

Analysts at FBN Capital Research said the bank’s PBT and PAT were ahead of their forecast by 13 per cent and 16 per cent, respectively due mainly to the positive surprise on the non-interest income line (47 per cent).

Stressing that the performance was impressive, they said they expected a positive reaction by the market to the bank’s performance.

“We expect consensus forecasts to be flat to slightly up. As such, we would expect a positive reaction by the market to the results,” they said.

The Group Managing Director and Chief Executive Officer, Zenith Bank, Mr. Peter Amangbo, was quoted in a statement by the bank as saying that the bank expected 2015 to be a positive year for its stakeholders.

He said, “The year 2015 has high prospects of increased economic growth and development, following the successful conduct of general elections in the country. This scenario will present the group with ample opportunity to grow its clientele and business volume in Nigeria while consolidating on its gains from foreign subsidiaries.”

He explained that the performance had demonstrated the bank’s leadership position in the banking sector, stressing that its excellent customer services played a role in its success.

He also said, “The group’s focus on creation of well-priced high-quality assets is evident in the year-on-year growth of loans and advances by 44.6 per cent with a moderate cost of risk of 0.5 per cent and non-performing loan ratio of 1.7 per cent.

“The growth in risk assets (priced to maximise returns) was effectively matched by a corresponding increase in competitively priced deposits with a view to maximising net interest margin.

“With a loan-to-deposit ratio of 67.3 per cent, Basel II capital adequacy ratio of 18.82 per cent and liquidity ratio of 44.4 per cent, Zenith group is well positioned to explore business opportunities in strategic sectors of the economy.”

The Executive Director, Credit and Risk Management Division, Zenith Bank, Mr. Ebenezer Onyeagwu, also expressed confidence in the bank’s performance in 2015.

He explained that with a loan-to-deposit ratio of 67.3 per cent, a very strong capital base and a highly liquid balance sheet, the group was well positioned to grow its risk assets as well as explore other rewarding opportunities in the country and in all other locations where it had a presence.

[Punch]

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