FY 2018: Zenith Bank records N232bn PBT ..excites shareholders with dividend offer of N2.80 per share

FY 2018: Zenith Bank records N232bn PBT ..excites shareholders with dividend offer of N2.80 per share

- in World News

By Chinwendu Obienyi 

Despite the challenging macro-environment, Zenith Bank, today, Wednesday, 20th February,2019 announced a profit amounting up to N232 billion for the 12 months ended December 31, 2018.

This represents an increase of over 16.6 per cent from N199 billion recorded in the corresponding period of 2017.

Also, in demonstration of its commitment to its shareholders, the bank announced a proposed final dividend pay-out of N2.50 per share, bringing the total dividend to N2.80 per share, representing a yield of 11.2 per cent.

According to the bank’s audited financial results for the 2018 financial year released in Lagos yesterday, it’s PBT was achieved through the Group’s optimisation of its cost of funds, cost-to-income ratio and cost of risk, ensuring that earnings per share strengthened by 11 per cent to N6.15.

The bank’s profit after tax (PAT) also witnessed an impressive growth of 11 per cent year-on-year to N193 billion from N174 billion while its balance sheet remained shockproof as loan to deposit ratio, liquidity ratio and capital adequacy ratio were 44.2, 72.0 and 25.0 per cent respectively and all above the regulatory threshold.

The statement said,  “Despite the challenging macro-environment, the Group mitigated the knock-on effects through growth of its net interest income and operating income by 15 and 8 per cent respectively as it was able to ensure improved cost efficiencies across the business. 

This focus on cost efficiencies is yielding tangible benefits as the Group recorded its lowest ever cost-to-income ratio at 49.3 per cent from 52.8 per cent in 2017. “

Furthermore,  the bank’s risk-centric approach also ensured that cost of risk reduced significantly by 79 per cent from 4.3 per cent in the prior year to 0.9 per cent in 2018.  

This was reflected through the drop-off in impairment charges by 81 per cent(N80 billion) compared to 2017, re-affirming the Group’s enhanced asset quality. 

In the same breadth, coverage ratio increased by 34.2 per cent from 143.4 per cent to 192.4 per cent over the same period, reflecting a prudent disposition to credit risk management while Cost of funds also moved in the positive direction, declining by 41 per cent from 5.2 per cent in 2017 to 3.1 per cent  for the year, supported by a 33 per cent decrease in interest expense (N72 billion) over the same period, demonstrating a robust treasury and liquidity management.

Also, the Group’s efforts to deepen its roots in the retail segment have started yielding benefits.  

This has resulted in a remarkable increase in the volume of transactions across various electronic platforms as well as significant customer acquisitions while growth in transactions on its digital channels continues to support its retail push as fees from e-products increased by 44 per cent over 2017 with retail deposit balances also growing by 25 per cent.  

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