The gross earnings of Zenith Bank Plc rose by 189 per cent in the first quarter of the year; the bank has announced its unaudited results.
The impressive triple-digit growth performance shot the bank’s earnings to N781 billion as against the N270 it reported in the first quarter of last year.
According to the report, the bank achieved the feat despite the challenging operating environment and tightening monetary policy stance.
From the unaudited statement of account submitted last Friday to the Nigerian Exchange (NGX), the impressive growth in the top line also enhanced the bottom line.
The bank’s Profit Before Tax (PBT) rose to N320 billion, representing an increase of 270 per cent from the N87 billion reported in the first quarter of 2023.
Its Profit after tax (PAT) also grew by 291 per cent from the N66 billion reported in the first quarter of 2023 to N258 billion in the current period.
The statement said that the interest and non-interest income contributed significantly to the growth in gross earnings.
Interest income grew by 155 per cent from the N192 billion reported in the quarter ended March 2023 to N489 billion in the period to 31 March 2024.
The growth in interest income is due to the repricing of risk assets, owing to the increase in the central bank’s Monetary Policy Rate (MPR), which currently stands at 24.75 per cent. The growth in net interest income is primarily due to the increase in fees and commissions as well as trading grains.
The bank reported an impairment charge of N56 billion for the first quarter of 2024, up from N8 billion recorded in the first quarter of 2023.
The statement reads: “This is attributable to significant growth in risk assets, primarily driven by the revaluation of its USD loans, which necessitated additional impairment on the bank’s foreign currency-denominated loans.
“The cost of funds grew by 48 per cent from 2.7 per cent in first quarter of 2023 to four per cent in first quarter of 2024 due to the high-interest rate environment, while interest expense increased by 157 per cent from N71 billion reported in first quarter of 2023 to N182 billion in the period to March 2024.
“Notwithstanding the year-on-year (YoY) increase in interest expense, net interest margin (NIM) grew by 20 per cent from 6.9 per cent in the three months ended March 2023 to 8.3 per cent in the current period ending 31 March 2024.
“Return on Average Equity (ROAE) and Return on Average Assets (ROAA) increased year-on-year (YoY) by 114% and 119%, respectively, due to improved profitability”.
