BUSINESS/ECONOMY: Zenith Bank records gross earnings of N166.8b in Q1
Zenith Bank Plc has announced its unaudited results for the first quarter ended March 31, 2020, with gross earnings rising by six per cent from N158.1 billion in March 2019 to N166.8 billion.
From the unaudited statement of account, which was presented to the Nigerian Stock Exchange (NSE) on Wednesday, April 29, this top-line growth was driven by the 43 per cent expansion in non-interest income from N32.7 billion in the prior-year period to N46.6 billion in March 2020.
The bank’s profit before tax also rose three per cent from N57.3 billion in the prior-year period to N58.8 billion in March 2020. The increased profits benefited from the twin effects of continuing top-line growth and focused cost-of-funds optimisation.
Cost of funds declined significantly from three per cent in March 2019 to 2.6 per cent in the quarter, translating to a 10 per cent decrease in interest expense dropping from N36.3 billion in March 2019 to N32.8 billion in the quarter.
Despite this drop, the low yield environment necessitated the repricing of interest-bearing assets which in turn resulted in a 13 per cent compression in net interest margin, decreasing from 8.9 per cent in March 2019 to 7.7 per cent in the current period.
Zenith Bank has continued to gain customer acceptance, with customer deposits increasing by five per cent from N4.26 trillion in December 2019 to N4.46 trillion in first quarter of 2020. The bank’s customer deposit mix rebalancing remains on-track as the Group added N150 billion in savings account balances in Q1, supported by its retail drive.
The bank’s total assets increased by 12 per cent growing from N6.35 trillion in December 2019 to close at N7.13 trillion in first quarter of 2020. Gross loans grew by 11 per cent from N2.46 trillion in December 2019 to N2.74 trillion in first quarter of the year.