Zenith Bank Plc, one of Nigeria’s leading financial institutions, has reported impressive financial results for the first quarter ending 31st March 2023.
In the bank’s unaudited financial statement obtained by Investors King, the lender reports a double-digit growth of 41% in gross earnings from ₦191.5 billion filed in Q1 2022 to ₦270 billion in Q1 2023.
The bank noted that the double-digit growth in the topline also boosted the bottom line, with the group experiencing an impressive 27% year-on-year (YoY) increase in profit before tax (PBT), rising from ₦68 billion in Q1 2022 to ₦86.6 billion in Q1 2023.
Profit after tax (PAT) also grew by 13% from ₦58.2 billion to ₦66 billion during the same period.
The growth in the topline was propelled by substantial increases in both interest income and non-interest income. Interest income surged by 52% from ₦126.4 billion in Q1 2022 to ₦191.6 billion in Q1 2023, while non-interest income expanded by 27% from ₦57.2 billion to ₦72.8 billion.
The growth in interest income can be attributed to the impact of risk asset repricing, while the increase in non-interest income primarily resulted from loan recoveries and foreign currency revaluation gains.
Similarly, the cost-to-income ratio improved from 55% to 53.4% in the current period, supported by a bolstered income line while the cost of risk also moderated from 0.8% to 0.7% during the same period due to an enlarged loan book.
However, the cost of funding doubled YoY from 1.3% in Q1 2022 to 2.7% in Q1 2023, owing to a considerable spike in interest rates between both periods. This impacted the net interest margin (NIM), which reduced from 7.3% to 6.9% over the same period.
Despite the challenging operating environment, Zenith Bank has continued to grow its total assets, which expanded by 9% from ₦12.29 trillion in December 2022 to ₦13.36 trillion in March 2023, primarily driven by growth in customer deposits and other funding sources such as borrowings.
Customer deposits increased by 2% from ₦8.98 trillion in December 2022 to ₦9.14 trillion in March 2023.
The bank’s loans and advances also experienced marginal growth of 1% from ₦4.12 trillion in December 2022 to ₦4.15 trillion in March 2023 as customers continued to adjust to the full impact of higher rates on risk assets. Both the capital adequacy and liquidity ratios remained robust at 19.5% and 72%, respectively, with both prudential ratios comfortably exceeding regulatory thresholds.
Looking ahead, the group will maintain its focus on sustainable growth across all business segments as it restructures into a holding company, introduces new verticals to its businesses, and expands into new frontiers.
Zenith Bank’s consistent record of outstanding performance has garnered numerous accolades for the brand, including being acknowledged as the Number One Bank in Nigeria by Tier-1 Capital for the 13th consecutive year in the 2022 Top 1000 World Banks Ranking published by The Banker Magazine. The bank has also received
