Nation
Zenith, UBA and GT Banks post bumper harvest in nine month 2022
At a time most banks are still struggling to grow loans and advances and make meaningful progress in critical financial measurement segments of operations, Zenith Bank, United Bank for Africa and GT Bank can boast of working against the headwinds At to achieve significant success in their profitability.
The top and dominant lenders which third quarter results for 2022 hit customs street last week have every reason to cheer about strong performances in a fragile economy.
With strong profitability, solid assets and comfortable non- interest incomes, Zenith Bank,UBA and GT Bank have laid a foundation for reliable and confident future for their stakeholders.
ZENITH BANK FORGES AHEAD WITH REMARKABLE DOUBLE-DIGIT GROWTH IN GROSS EARNINGS IN Q3 2022
Zenith Bank Plc has announced its unaudited results for the third quarter ended 30 September 2022, recording a remarkable double-digit growth of 20% in gross earnings from NGN518.7 billion reported in Q3 2021 to NGN620.6 billion in Q3 2022. This performance demonstrates the Group’s resilience against a challenging macroeconomic environment.
According to the unaudited account presented to the Nigerian Exchange (NGX), the growth in the topline was driven by interest and non-interest income growth. Interest income grew by 27% from NGN308.8 billion to NGN390.8 billion, driven majorly by growth in risk assets and an improvement in pricing. This also strengthened Earnings Per Share (EPS) by 9% to NGN5.55.
This double-digit growth in the topline also aided the bottom line, as the Group also recorded a 13% year-on-year (YoY) increase in profit before tax, growing from NGN179.8 billion in Q3 2021 to NGN202.5 billion in Q3 2022. Profit after tax equally grew by 9% from NGN160.6 billion to NGN174.3 billion in the same period.
Growth in non-interest income was enabled by the Group’s retail strategy, with continued substantial customer acquisition driving transactions, deposit growth and growth in electronic banking income.
Due to inflationary pressure and the rising cost of doing business, operating costs grew by 17%. However, this was below the growth in gross earnings (20%), thereby facilitating the double-digit growth in the bottom line.
The continuing elevated yield environment affected the cost of funding which increased from 1.4% to 1.7% in the current period. This affected the net interest margin (NIM), which dropped due to the immediate implementation of higher yields on interest-bearing liabilities. However, the NIM is expected to see a correction in subsequent quarters as the assets side is repriced correspondingly.
Total assets grew by 20% from NGN9.45 trillion to NGN11.34 trillion in 2022, mainly driven by growth in customers’ deposits. Customer deposits grew by 24% from NGN6.47 trillion in December 2021 to NGN8.04 trillion in September 2022 due to the market’s confidence in the brand.
Loans and advances also grew by 16% from NGN3.5 trillion in December 2021 to NGN4.06 trillion in September 2022, boosting the Group’s interest income and displaying the Group’s appetite for high-yielding risk assets creation. As a result of this growth, the capital adequacy ratio reduced from 21% to 19.1%, while the liquidity ratio reduced from 71.6% to 68.9%.
Both prudential ratios remain very strong and are still well above regulatory thresholds.
In the year’s final quarter, management is determined to sustain the strong performance trajectory while adapting to changes in the regulatory environment and focusing on creative initiatives to mitigate inflationary trends, foreign exchange pressures and the growing competitive environment.
Zenith Bank’s track record of excellent performance has continued to earn the brand numerous awards, including being recognised as 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; Best Bank in Nigeria, for three consecutive years from 2020 to 2022, in the Global Finance World’s Best Banks Awards; Best Commercial Bank, Nigeria 2021 and 2022 in the World Finance Banking Awards; Best Corporate Governance Bank, Nigeria in the World Finance Corporate Governance Awards 2022; Best in Corporate Governance’ Financial Services’ Africa, for three consecutive years from 2020 to 2022, by the Ethical Boardroom; Best Commercial Bank, Nigeria and Best Innovation In Retail Banking, Nigeria in the International Banker 2022 Banking Awards. Also, the Bank emerged as the Most Valuable Banking Brand in Nigeria in the Banker Magazine Top 500 Banking Brands 2020 and 2021, Bank of the Year (Nigeria) in The Banker’s Bank of the Year Awards 2020 and Retail Bank of the year at the BusinessDay Banks and Other Financial Institutions (BOFI) Awards 2020 and 2021.
Similarly, Zenith Bank was honoured as Bank of the Decade (People’s Choice) at the ThisDay Awards 2020 and emerged winner in four categories at the Sustainability, Enterprise, and Responsibility (SERAS) Awards 2021, carting home the awards for “Best Company in Reporting and Transparency”, “Best Company in Infrastructure Development”, “Best Company in Gender Equality and Women Empowerment”, and the coveted “Most Responsible Organisation in Africa.
Q3 2022: UBA records 12.3% profit growth, amasses N608bn in gross earnings
The United Bank for Africa (UBA) Plc, Africa’s Global Bank, has released its unaudited financial results for the third quarter of 2022, ended September 30, recording impressive growth across all major indices.
The result follows on the trend of its remarkable performance in the first two quarters of the year.
Specifically, the bank said Gross Earnings rose to N608 billion, up from N493 billion recorded in September 2021, while Operating income also grew by 27.3% to close at N414.1 billion as at September 2022, up from N334.8 billion achieved a year earlier. 12.3% rise in Profit Before Tax to close at N138.5 billion compared to N123.4 billion recorded at the end of the third quarter of 2021, while profit after tax also rose significantly by 10.9% to N116 billion up from N104.6 billion recorded a year earlier, thus sustaining its annualised return on average equity for Q3 2022 at 19.2%.
The bank continues to maintain a very strong balance sheet, with Total Assets rising to N9.3 trillion, representing a 9.1% increase over the N8.5 trillion recorded at the end of December 2021, just as it benefitted largely from its technology-led initiatives targeted at improving customer experience over the past few years, with Customer Deposits rising to N7.03 trillion, representing a 10.4% rise, up from N6.4 trillion at the end of the last financial year.
UBA shareholders’ funds remained very strong at N809 billion up from N805 billion recorded in December 2021, again reflecting a strong capacity for internal capital generation and growth.
Commenting on the result, UBA’s Group Managing Director/Chief Executive Officer, Mr. Oliver Alawuba, said the Group continues to show notable operating resilience amid significant headwinds heightened by global risk environment, thanks to its strong diversification model and unwavering focus on customer satisfaction.
“We continue to reap the benefits of our diversification strategy and Customer-1st philosophy and build resilience in our operations across Africa and the Rest of the World to support the mission of providing superior value to our stakeholders.
“This has translated into strong financial gains evident in growth in our customer deposits and Net interest margin. In addition, we are strategically positioned to drive our market share in our operating countries, with the strong growth of our payments and transaction banking offerings,” Alawuba stated.
Executive Director, Finance & Risk
Management, Ugo Nwaghodoh, said, “The Group’s profitability increased by 12.3% to N138.5 billion, with underlying growth in our key income lines and moderation in our cost of funds.
“We remain very cautious in risk asset creation as we defensively position our asset portfolios to minimise the impact of the heightened credit risk. Consequently, our NPL ratio remains within acceptable threshold at 3.2%.”
United Bank for Africa Plc is a leading Pan-African financial institution, offering banking services to more than 25 million customers, across 1,000 business offices and customer touch points in 20 African countries. With presence in New York, London, Paris, and Dubai, UBA is connecting people and businesses across Africa through retail, commercial and corporate banking, innovative cross-border payments and remittances, trade finance and ancillary banking services.
Guaranty Trust profit grows 11.7% to N169.7bn in Q3
Guaranty Trust Holding Company (GTCO) Plc has recorded 11.7% increase in Profit Before Tax, PBT, to N169.7 billion in its operations in the third quarter ended September 30, 2022 (Q3’22) against N151.9 billion recorded in the corresponding period ended September 30, 2021(Q3’21).
Guaranty Trust Holding Company (GTCO) Plc has recorded 11.7% increase in Profit Before Tax, PBT, to N169.7 billion in its operations in the third quarter ended September 30, 2022 (Q3’22) against N151.9 billion recorded in the corresponding period ended September 30, 2021(Q3’21).
Commenting on the results, the Group Chief Executive Officer of Guaranty Trust Holding Company Plc (GTCO Plc), Mr. Segun Agbaje, said: “The Group’s 3rd quarter result reaffirms our strategy for long-term growth and underscores our capacity to deliver sustainable strong performance despite the volatilities in our operating environment.
“We have also kept in focus our vision of supporting small and medium enterprises specifically through our free business platforms to help them stay in business and expand their offerings.”
Analysts believe that this is no mean performance in a very weak economy.
Nigeria’s economy has in most of the past seven years been struggling, giving out discouraging signals to would be investors in the country. This has become a source of concern to the discerning especially economic experts whose expectations are not met.
Throughout this year the impressions of the Bretton Woods institutions do not seem to see signs of improvements in the economic policies for positive growth, but that of gloom and uncertainty.
Critically, recent statistics reveal that the rate of unemployment, the one of the highest in the world is 40%. At the same time, the underemployment rate stood at 25%; even as inflation, which is hitting the roof top at 20.6,highest point in the last seven years. At the same time, Diaspora remittances inflow stood at $19 billion in 2021 lower than the $23billion recorded before the covid -19 year.
Also remarkable is the country’s heavy debt burden at N43trillion ($103b)and expected to continue to grow; of the budget of N17.123trillion budget deficit stood at N6.25 trillion (representing 3.6 per cent of total budget) as over 99 per cent of revenues is used to service debt. More worrisome is that the country has set new borrowing limit from 25 per cent of GDP to 40 per cent of the GDP. This was contained in the Medium Term Debt Strategy.
The major revenue earner for the country, crude oil price, which has hit $100 pbd and above presently still fluctuates.
Insecurity has not only hobbled agriculture, many parts of Northern Nigeria have been taken over by bandits such that not much business activities can subsist. The World Bank just noted that Nigeria’s revenue to GDP ratio hovered between five and six per cent last year and remains the lowest in the world. These days almost every everybody is aware that Nigeria parades the most poverty stricken people in the world, competing with India.
The Naira which sold at N220/$ in June 15, 2015 has depreciated by 300 per cent to N780/$ as at yesterday September 29, 2022.
