Zenith Bank’s  gross earning increases 24% to N945.5bn in 2022

By Cynthia Ezekwe

Zenith Bank Plc has announced that  its audited financial results for 2022 recorded a double-digit increase of 24 per cent in its gross earnings from N765.6  billion recorded in 2021 to N945.5 billion in 2022, despite the economic headwinds.

According to the tier-1 bank, the double-digit growth in gross earnings was driven by a 26 percent year-on-year (YoY) growth in interest income from N427.6 billion to N540.2 billion and a 23 percent year-on-year growth in non-interest income from N309 billion to N381 billion.

The 2022 audited financial results which was published on the Nigerian Exchange (NGX) showed that Profit before tax grew by 2 per cent from N280.4 billion to N284.7 billion in the current year. The increase in profit before tax was due to the significant growth in all the income lines.

Impairments grew by 107 per cent from N59.9 billion to N124.2 billion, while interest expense increased by  63 percent YoY from N106.8 billion to N173.5 billion, respectively. The impairment growth, also resulting in an increase in the cost of risk from 1.9 per cent  in 2021 to 3.3 per cent  in the year under  preview, was due to the impact of Ghana’s sovereign debt restructuring programme. The growth in interest expense increased the cost of funds from 1.5 per cent in 2021 to 1.9 per cent in 2022 due to hikes in interest rates globally.

The financial result for the year under review further revealed that customer deposits grew by 39 per cent, an increase  from N6.47 trillion in the previous year to N8.98 trillion in the current year. The growth in customer deposits came from all products and deposit segments, including corporate and retail,indicating customers’ trust.

The bank’s Net-Interest-Margin (NIM), also grew from 6.7 per cent to 7.2 percent due to an effective repricing of interest-bearing assets. Operating expenses grew by 17 per cent YoY, but growth remains below the inflation rate. Total assets increased by 30 per cent, an increase  from N9.45 trillion in 2021 to N12.29 trillion, mainly driven by growth in customer deposits.

The Group prudently grew its gross loans by 20 per cent, from N3.5 trillion in 2021 to N4.1 trillion in 2022, which increased the Non-Performing Loan (NPL) ratio modestly from 4.2 per cent  to 4.3 per cent YoY. The capital adequacy ratio decreased from 21 per cent to 19 per cent, while the liquidity ratio improved from 71.2 per cent to 75 per cent. Both prudential ratios are well above regulatory thresholds.

Zenith Bank also disclosed that in 2023 it intends to expand its frontiers as it reorganises into a holding company structure, adding new verticals to its businesses and growing in all its chosen markets, both locally and internationally.

As a testament to its commitment to shareholders, the bank has announced a proposed final dividend payout of N2.90 per share, bringing the total dividend to N3.20 per share.