September 11, (THEWILL) – Zenith Bank Plc has reported a 161.8 percent growth in its 2023 half-year profit after tax to N291.73 billion from N111.41 billion in the corresponding period of 2022.
The Tier-1 bank also posted a significant increase in profit before tax, which hit N350.36 billion compared with N130 billion in the equivalent period of the preceding year, representing a 161.8 percent jump.
The half-year interim report of the financial services institution, listed on the premium category of the Nigerian Exchange, showed that overall profitability increased significantly despite the higher income tax expense (+215.3 percent y/y to NGN58.63 billion), against N39.73 billion in the preceding year’s same period.
The financial institution also recorded a 161.7 percent (y/y) expansion in earnings per share (EPS) to N9.29 billion compared with N3.55 billion in HY 2022.
The significant growth in the bank’s earnings was supported by the broad-based expansion across its funded (+71.9 percent y/y) and non-funded (+246.1 percent y/y) income lines.
Management proposed an interim dividend of N0.50/share (H1-22; NGN0.30/share), translating to a dividend yield of 1.4 percent based on the last closing price of NGN36.95/share (11 September).
Cordros Research reports that the bank recorded a 71.9 percent y/y growth in funded income to N415.43 billion, driven by higher yields in the fixed income market and, also, growth in its earning assets (+22.5% YTD to N12.25 trillion).
Across the contributory lines, the bank generated higher income from loans and advances to banks (+457.8 percent y/y to N21.54 billion), loans and advances to customers (+55.4 percent y/y to N253.95 billion), and investment securities (+88.0 percent y/y to N139.94 billion) in the review period.
Non-interest income surged by 246.1 percent y/y to NGN515.69 billion, as the naira devaluation drove the significant gains generated from foreign exchange revaluation of N355.59 billion (vs. the N6.25 billion loss recorded in H1-22).
In addition, the FX revaluation gains and income from trading investment securities were sufficient to offset the lower income from net fees and commission (-31.8 percent y/y to NGN43.92 billion) in H1-23.
Consequently, the impressive non-interest income expansion, alongside the growth in net interest income (+41.7 percent y/y), led to an 84.6 percent y/y increase in operating income to N568.63 billion.
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
