Business
Zenith Bank hits the Bull’s eye with N1.0trn PBT in nine months of 2024
Zenith Bank Plc has released its unaudited results for the third quarter ending September 30, 2024. The bank achieved an impressive 118% growth, rising from N1.33 trillion reported in Q3 2023 to N2.9 trillion in Q3 2024. This performance highlights the Group’s resilience and market leadership, even in a challenging macroeconomic environment.
According to the Bank’s unaudited financial results for the third quarter, which were presented to the Nigerian Exchange (NGX), the significant revenue growth contributed to an increase in profit. The Group recorded a 99% year-on-year (YoY) increase in profit before tax, rising from N505 billion in Q3 2023 to N1.0 trillion in Q3 2024. Similarly, profit after tax grew by 91%, increasing from N434.2 billion to N827 billion during the same period.
The increase in revenue was driven by growth in both interest and non-interest income. Interest income experienced a remarkable 190% rise, reaching N1.95 trillion, thanks to the favorable high-yield environment. Non-interest income also grew by 41% to N856 billion, supported by significant gains in fees and commissions. This illustrates the strength of Zenith Bank’s retail growth and the strong performance of its digital channels during the reporting period.
The substantial rise in profitability reflects the bank’s commitment to operational efficiency and effective risk management practices. Earnings per share (EPS) nearly doubled, increasing from N13.82 in Q3 2023 to N26.34, highlighting Zenith Bank’s success in creating value for its shareholders.
The Bank’s balance sheet showed substantial growth, with total assets increasing by 49% to reach N30.4 trillion. This growth was primarily driven by a 42% rise in customer deposits, which amounted to N21.6 trillion. The increase in deposits was broad-based, encompassing both corporate and retail segments, indicating the Bank’s expanding reach and strong customer loyalty. Additionally, gross loans grew by 46%, reaching N10.3 trillion, which reflects the Bank’s commitment to supporting key sectors of the economy.
The capital adequacy ratio remained strong, improving to 21.9%, which is well above regulatory requirements. The return on average equity (ROAE) increased to 37.8%, up from 35.1%. Similarly, the return on average assets (ROAA) improved to 4.3%, demonstrating Zenith Bank’s effective utilization of its asset base. The cost of funds rose to 4.3%, reflecting the broader market trend of increasing interest rates. Meanwhile, the cost of risk was maintained at 7.3%, highlighting the bank’s proactive approach to provisioning for credit risk. The cost-to-income ratio increased to 39.5%, reflecting the impact of strategic investments in technology and capacity building to support long-term growth, all while the bank continues to pursue greater operational efficiency.
Zenith Bank’s asset quality is a key pillar of its strength, evidenced by a non-performing loan (NPL) ratio of 4.5%, which falls within regulatory limits.
The bank’s high coverage ratio of 198.4% highlights its disciplined risk management approach, ensuring resilience amid market volatility while fostering stable loan growth.
Zenith Bank is committed to sustainable growth and value creation. On August 1, 2024, the Bank launched a capital raising program that includes both a Rights Issue and a Public Offer. This initiative was prompted by the Central Bank of Nigeria (CBN)’s directive in March 2024 for commercial banks to recapitalize. While the Bank is still awaiting final capital verification approvals from the authorities, the fundraising effort has been successful, demonstrating strong confidence in Zenith Bank’s brand.
The additional capital will strengthen the Bank’s capacity to expand its product offerings, increase its market presence in strategic sectors, enhance lending to the real economy, and pursue its expansion plans in Africa and globally. In line with this goal, the Bank received regulatory approval in September 2024 to establish a Zenith Bank branch in Paris, France. This branch is now fully operational and will improve the Bank’s product offerings in international markets.
With a strengthened capital base, Zenith Bank is well-positioned to navigate the evolving economic landscape while placing best-practice sustainability standards at the core of its operations. The bank will continue to prioritize opportunities that enhance stakeholder value and foster a strong culture of compliance and corporate governance. This approach will reinforce its leadership position within Nigeria’s financial sector and drive long-term growth.
