ZENITH Bank Plc in its unaudited results for the three months ended March 31, declared a profit before tax of N33.128 billion for the period. The figure is 15 percent higher than the N28.919 billion profit before tax it posted for the corresponding period of 2014.
The results, which showed that the bank grew its gross earnings by 20 percent from N94.324 billion to N113.322 billion, also showed that it recorded a 17 percent growth in profit after tax year-on-year. Specifically, the bank’s profit after tax rose from N23.677 billion, which it declared for the first quarter of 2014, to N27.680 billion 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 N81 billion, compared with the N71 billion it posted in the similar period of 2014 translating to a 14 percent increase, while its non-interest income appreciated by 39.5 percent to N31.9 billion from N22.9 billion in 2014. The operating income rose to N72 billion, compared to N66 billion in the same period of 2014, while operating expenses increased by 4.8 percent to N39bn from N37.6 billion.
Peter Amangbo, group managing director, Zenith Bank, was quoted in a statement by the bank as saying that the bank expected 2015 to be a positive year for its stakeholders. “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 said.
Amangbo 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. “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 percent with a moderate cost of risk of 0.5 percent and non-performing loan ratio of 1.7 percent.
“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 percent, Basel II capital adequacy ratio of 18.82 percent and liquidity ratio of 44.4 percent, Zenith group is well positioned to explore business opportunities in strategic sectors of the economy.”
Sterling Grows Despite Economic Headwinds
STERLING Bank Plc has witnessed a 25 percent increase in its profit after tax for the first quarter of the 2015. This is according to the bank’s unaudited results for the period ended March 31, 2015. The results indicated growth in all key performance indices with the bank’s profit after tax rising from N3.1 billion to N3.9 billion year-on-year.
The bank’s profit before tax rose by 14.1 percent from the N3.5 billion it declared in the first quarter of 2013 to N4.0 billion in the review period, while non-interest income grew by 31.9 percent from N6.1 billion to N8 billion. According to the bank, the growth in non-interest income was driven by a 51 percent growth in fees and commission, which rose to N5 billion. The bank’s net operating income edged up by 6.1 percent from N15.3 billion to N16.2 billion on the back of a growth in non-interest income and a 10.4 percent reduction in impairment charges.
Net loans and advances also increased by 5.7 percent from N371.2 billion to N392.4.0 billion due to the lender’s selective approach to asset creation. Also, shareholders’ funds increased marginally by 4.3 percent from N84.7 billion to N88.4 billion due to profit accretion, while the total assets, excluding contingent liabilities, advanced by 2.1 percent from N824.5 billion to N841.9 billion.
A statement from the bank following the release of the results said that the first quarter performance demonstrated the lender’s ability to sustain its growth despite industry headwinds. Yemi Adeola, managing director, said during the bank’s quarterly update to investors and analysts that the performance was in line with expectations.
“Our first quarter performance was in line with expectations, having recorded a 25 percent growth in bottom-line earnings. This was driven by non-interest income, which rose by 32 percent to N8 billion on the back of a 51 percent increase in fees and commission. We recorded a marginal increase in operating expenses, which was slower than the growth in net operating income resulting in a 14 percent improvement in profit before tax. Overall, the bank achieved a 19 percent pre-tax return on average equity (annualised),” he said.
Adeola added that during the period, the lender achieved a return on average assets of two per cent by prioritising efficiency in the management of its balance sheet in response to a difficult operating environment. “Loan growth will remain steady and disciplined. We are very optimistic that our earnings growth momentum will be sustained in the remaining quarters of the year.”