Tuesday, May 18, 2021

Zenith Bank posts 5% rise in profit

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Naija247news, Nigeriahttps://www.naija247news.com/
Naija247news is an investigative news platform that tracks news on Nigerian Economy, Business, Politics, Financial and Africa and Global Economy.

Zenith Bank Plc has announced its unaudited results for the first quarter ended March 31, with Profit Before Tax (PBT) rising by 4% to N61.0 billion, from N58.8 billion recorded in March 2020.

According to the unaudited statement of account presented to the Nigerian Stock Exchange (NSE) on Friday, April 30, Profit After Tax (PAT) also grew by 5% from N50.5 billion in Q1 2020 to N53.1 billion in Q1 2021.

The profitability was driven by the optimisation of the cost of funds and improvement in non-interest income. The Bank’s cost of funds reduced significantly from 2.6% in March 2020 to 1.1% in March 2021.

This was also reflected in interest expense which dropped by 45% from N32.8 billion to N18.0 billion over the same period. Non-interest income increased by 10% from N46.6 billion to N51.2 billion, driven by growth in credit-related fees and fees on electronic products.

Non-interest income was boosted by the increase in fees and commission income, which resulted from the increased volume of transactions across all the Bank’s channels.

Cost of risk dropped from 0.6% in March 2020 to 0.5% in March 2021, which affirms the Bank’s prudent risk management, even as gross loans increased by 2% from N2.92 trillion to N2.98 trillion in Q1 2021.

The bank’s customer acquisition strategy and the effectiveness of its electronic platforms and digital channels enabled it to deliver a N54 billion increment in the savings account balance, which is solely retail. Customer deposits grew by 6% from N5.34 trillion in December 2020 to N5.68 trillion in March 2021.

Transactions on electronic channels also grew astoundingly as new customers continue to be attracted to the Bank’s various user-friendly digital platforms.

Going forward in 2021, the bank expects that the ongoing economic recovery and improvements in the yield environment will translate into improved numbers for the Group.

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