Zenith Bank, one of Nigeria’s leading financial institutions, has demonstrated its ability to balance the complex needs of depositors, borrowers, and regulatory authorities while delivering superior returns to shareholders. The bank’s success can be attributed to its strong financial management and strategic vision.
Zenith Bank’s robust risk management framework enables it to comply with regulatory requirements while providing affordable credit to borrowers. The bank maintains liquidity to meet depositors’ needs while investing in high-yielding assets that benefit shareholders. Its commitment to regulatory compliance ensures that it meets the requirements of regulatory authorities while delivering value to its customers and shareholders.
As a result, the bank has generated strong financial performance and driven long-term sustainability. Its commitment to effective risk management, investment in profitable opportunities, and regulatory compliance has delivered superior returns to its shareholders.
Zenith Bank’s model of excellence in balancing constituency needs and delivering superior returns serves as a benchmark for the banking industry. Its approach provides a guide for other financial institutions seeking to deliver value to their shareholders while meeting the needs of their diverse constituencies. The bank’s fundamentals confirm the above views
The Fundamentals : A Testament to its Resilience and Growth”
Zenith Bank’s impressive financial performance in 2024 is a reflection of its strong leadership, strategic vision, and commitment to delivering value to its shareholders. The Bank’s impressive performance reflects effective management and pricing of its risk assets, and an optimized treasury portfolio, reinforcing its position as a leader in Nigeria’s banking industry.
Financial Position
The Bank’s total assets grew by 47% from NGN20 trillion in 2023 to NGN30 trillion in 2024, underpinned by a strong liquidity position and effective balance sheet management. Customer deposits surged by 45% from NGN15 trillion to NGN22 trillion in 2024, reflecting a historically strong
corporate deposits portfolio and a sustained increase in retail deposits. The increase in retail deposits was driven by customer acquisition and the Bank’s strategic focus on low-cost funding.
Gross Earnings
The Bank recorded a double-digit year-on-year (YoY) growth of 86% in gross earnings, increasing from NGN2.13 trillion in 2023 to NGN3.97 trillion in 2024. This growth was driven by a 138% increase in interest income, supported by investment in high-yield government securities, and growth in the
Bank’s loan book.
Profitability
Zenith Bank’s profit before tax (PBT) rose by 67%, reaching NGN1.3 trillion in 2024 from NGN796 billion in 2023, driven by a combination of top-line expansion and efficient treasury portfolio management. Net interest income increased by 135% from NGN736 billion in 2023 to NGN1.7 trillion,
reinforcing the Bank’s strong core banking performance and ability to grow earnings despite macroeconomic headwinds. Non-interest income also grew by 20% from NGN919 billion to NGN1.1
trillion.
Return on Average Equity (ROAE) declined to 32.5% on the back of the injection of new capital, while Return on Average Assets (ROAA) remained unchanged at 4.1%. The Bank’s cost-to-income increased slightly from 36.1% to 38.9%, despite inflationary pressures. Its Non-Performing Loan (NPL)
ratio stood at 4.7%, with a coverage ratio of 223%, underscoring the Bank’s prudent risk management and commitment to maintaining a resilient loan book, ensuring stability and confidence in the Bank’s
operations.
.With its robust financial position, Zenith Bank’s board of directors proposed a final dividend payment of N4.00 per share, bringing the total dividend for the 2024 financial year to N5.00 per share. The total value of the dividend payout stands at N195.67 billion, reflecting the bank’s commitment to delivering value to its shareholders. The dividend yield stands at an impressive 7.76%, making Zenith Bank an attractive investment opportunity for income-seeking investors.
Furthermore, the bank’s stock price has been on an upward trajectory, reflecting its strong financial performance and growth prospects. The bank’s market capitalization stands at N2.7 trillion, with a price-to-earnings (P/E) ratio of 2.75, indicating that the stock may be undervalued. Given its strong financials and growth prospects, Zenith Bank is well-positioned for continued success in the future.
The bank’s leadership has assured shareholders of its commitment to maintaining a strong financial position and delivering superior returns on investment. With its robust financial position and growth prospects, Zenith Bank is an attractive investment opportunity for investors seeking exposure to the Nigerian banking sector.
