Ebeneezer Onyeagwu, Zenith Bank MD
Zenith Bank MD, Ebenezer Onyeagwu


Amidst headwinds, Zenith Bank and United Bank for Africa (UBA)have delivered strong and superior performances in the third quarter ended September 30, 2021.

According the results which trickled in this week, while UBA recorded a whooping increase of 37 per cent in profit before tax, Zenith Bank also delivered impressive profit at the end of nine month. These results show that the tier 1 banks are stoic and moved against the head and tail winds to create value and wealth for their owners.


Zenith Bank Plc has announced its unaudited results for the nine months ended 30 September 2021, with Gross Earnings rising by 2% from NGN509 billion recorded in the same period in 2020 to NGN519 billion, amidst the persistent challenging macroeconomic environment which was exacerbated by the Coronavirus (COVID-19) pandemic.

According to the Group’s unaudited nine months financial results presented to the Nigerian Exchange (NGX), the growth in gross earnings was largely due to an increase in current account maintenance fees and fees from electronic products during the period. Profit Before Tax (PBT) also rose to NGN180 billion, reflecting a 1% growth over the NGN177 billion recorded in the same period in the previous year.

Despite continuing economic uncertainties, the Group was able to grow its net earnings through a reduction in its cost of funds while keeping the cost of risk flat. This strengthened Earnings Per Share (EPS) by 1% to NGN5.11. The Group achieved a 9% growth in interest income from loans and advances on the back of an increase in gross loans of 9% year to date and enhanced efficiency, culminating in a 21% drop in interest expense to NGN74 billion from NGN94 billion.This resulted in the growth in net interest income of 4%, from NGN225 billion recorded at the end of Q3 2020 to NGN235 billion in the current period.

Total assets also increased by 3% to NGN8.8 trillion in the current period, while total deposits grew by 13% to close at NGN6.0 trillion from NGN5.3 trillion as at 31 December 2020, with a substantial contribution from retail deposits.

As a result of the focused drive to increase retail deposits in the past three years, there was a decrease in The Group’s cost of funds by 35% to 1.4% from 2.2% year-on-year. The Group continues to make significant progress in its retail banking drive, as evidenced by remarkable growth in transaction volumes and value across its digital platforms and strong growth in customer acquisition.

For the final quarter of the year, management’s outlook remains positive, buoyed by a declining inflationary trend, expected increase in foreign exchange inflows, and improving oil production. The Group remains focused on increasing its retail market share, consolidating its leadership position in the corporate segment and maintaining a robust balance sheet.

In recognition of its track record of excellent performance, Zenith Bank was voted as Best Commercial Bank in Nigeria in the World Finance Banking Awards 2021, Bank of the Year (Nigeria) in The Banker’s Bank of the Year Awards 2020, Best Bank in Nigeria in the Global Finance World’s Best Banks Awards 2020 and 2021, and Best in Corporate Governance ‘Financial Services’ Africa 2020 and 2021 by the Ethical Boardroom. Also, the Bank emerged as the Most Valuable Banking Brand in Nigeria in the Banker Magazine Top 500 Banking Brands 2020 and 2021, and Number One Bank in Nigeria by Tier-1 Capital in the “2021 Top 1000 World Banks” Ranking by The Banker Magazine. In 2020, Zenith Bank was honoured as Bank of the Decade (People’s Choice) at the ThisDay Awards 2020, Retail Bank of the year at the BusinessDay Banks and Other Financial Institutions (BOFI) Awards, and Best Company in Promotion of Good Health and Well-Being as well as Best Company in Promotion of Gender Equality and Women Empowerment at theSustainability, Enterprise, and Responsibility (SERAS) Awards.

For over three decades, Zenith Bank has distinguished itself in the Nigerian financial services industry through superior service offerings, unique customer experience, and sound economic indices. The Bank remains a clear leader in the digital space with several firsts in deploying innovative products, solutions, and an assortment of alternative channels that ensure convenience, speed, and safety of transactions.

UBA records 37% profit growth, N490.3bn gross earnings in Q3’21

The United Bank for Africa Plc (UBA) has reported a profit before tax (PBT) of N123.4bn in the third quarter ended September 30, 2021, representing a 37 per cent rise from N90.4bn recorded in the same period of 2020.

Kennedy Uzoka, CEO, United Bank for Africa
Kennedy Uzoka

According to the pan- African bank’s unaudited financial statements filed at the Nigerian Exchange Limited (NGX), its gross earnings rose to N490.3bn from N454.4bn, while operating income increased by 13 per cent year-on-year to N331.7bn from N293.7bn.

Profit After Tax (PAT) also rose significantly by 36 percent to N104.6 billion from N77.1 billion recorded a year earlier, thereby putting its annualised return on average equity for Q3 2021 at 19.2 percent compared to 16.4 percent recorded in the similar period of 2020.

The tier 1 lender continues to maintain a very strong balance sheet, with Total Assets of N8.3 trillion, an 8% increase over the N7.7 trillion recorded at the end of December 2020, 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 N6.1trillion, representing a 7.2% increase from N5.7 trillion at the end of the last financial year.

Also, the shareholders’ funds remained very strong at N798.3 billion up by 10.3% from N724.1 billion recorded in December 2020, thus reflecting a strong capacity for internal capital generation and growth.

The Group Managing Director and Chief Executive Officer, UBA, Kennedy Uzoka, said, “Once again, the bank has shown resilience in delivering on its commitment to shareholders, stakeholders, and the investing public, evident in the strong positive financial metrics recorded in the reporting period.”

He said UBA’s approach to risk management and the efficacy of its business strategy helped in keeping its loan growth steady at double digit, while still being able to moderate its cost during the period.

He added, “Looking ahead, we believe our huge investments in digital business following lessons learnt from the pandemic, will continue to pay off in delivering significant growth opportunities across our business operations even as the economy speedily heals from the impact/effect of the pandemic.”

The GMD said the company would continue to remain a bank holding firm and leverage its balance sheet and customer base to deliver results to its shareholders.

The Group CFO, Ugo Nwaghodoh said, “The performance reflects our progressive efforts in building on our robust balance sheet, strong customer base and our people, in delivering impressive earnings.

“Particularly, I am pleased at the 90bps improvement in Cost of Funds (CoF) from 3.2 percent to 2.3 percent in the period. This was despite the increase in our customer deposits by 7.2 percent to N6.1 trillion, portraying the Bank’s deliberate effort to substitute high-cost funds for low-cost deposits.”

In the last five years, from 2016 to 2020, UBA’s management team under the leadership of Kennedy Uzoka has displayed strength and robust performance. This has been consistent as its profit after tax grew by 45.4 per cent from N90.642 billion in 2016 to N131.860billion in 2020. Its total assets has grown by 119.6 per cent in five years while loans and advances to customers have expanded by 61 per cent in the review period.

Overall, this is not a mean performance by any standards, especially at a time when the head and tail winds are strongest and devastating for businesses not only in Nigeria but also all over the world.

Analysts are bullish on the bank which has shown vigour and promise. One other significant thing about UBA is that it has long left its contemporaries behind and stands out as a leader. The lender (Company) has remained formidable in the midst of all odds.

In fact, in the previous years’ its strong performances have also provided a sturdy base for the vigour and strength which the lender has displayed.

And here is how Adonri situates it: ‘UBA has promised to pay dividends in 2021. I will take it from the historical perspective. UBA was one of the three old dominant banks and among them, I mean Union Bank and First Bank have been seriously troubled to the point that they have fallen down the pecking order. Union Bank and First Bank are now rubbing shoulders with the tier 2 and 3 banks.

‘’But UBA has remained entrenched as a tier 1 bank. That shows that the bank is resonant and has continued to grow from strength to strength. For several years it has been bedeviled by the kind of challenges that have burdened the other banks.

‘’Though it has its own internal problems. But it has been able to weather the storm. It has been able to do that because of the kind of re-invigorated leadership that one person has brought to the table and that is Tony Elumelu. Tony has kept that pedigree and has been able consolidate the bank, making a very vibrant and competitive brand.

‘’Then their cross border expansion has added huge value to the bank. The bank is now entrenched in the international arena, I think for that bank the sky is its limit, especially now that there is AFCTA. The African continental trade pact which will bring most African countries to trade among themselves is a definite boon. Most of those transactions will run through banks and UBA is one of the banks that is positioned to benefit from that trade’’, Adonri concluded.


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