Zenith Bank Plc has announced its unaudited results for the first quarter ending March 31, 2023, with a 41% increase in Gross Earnings from 191.5 billion in Q1 2022 to 270 billion in Q1 2023.
According to the unaudited statement of accounts submitted to the Nigerian Exchange (NGX) on Friday, 28th April 2023, the significant double-digit growth in the topline also boosted the bottom line, with the Group experiencing a 27% year-on-year (YoY) increase in Profit Before Tax (PBT), rising from 68 billion in Q1 2022 to 86.6 billion in Q1 2023. Profit After Tax (PAT) increased by 13% during the same period, rising from 58.2 billion to 66 billion.
The increase in the topline was driven by significant increases in both interest income and non-interest income. Interest income increased by 52% from 126.4 billion in the first quarter of 2022 to 191.6 billion in the first quarter of 2023, while non-interest income increased by 27% from 57.2 billion to 72.8 billion. Interest income increased due to the impact of risk asset repricing, whereas non-interest income increased primarily due to loan recoveries and foreign currency revaluation gains.
In terms of efficiency, the cost-to-income ratio fell from 55% to 53.4% in the current period, thanks to an improved income line. Due to an expanded loan book, the risk cost also decreased from 0.8% to 0.7% during the same period. However, the cost of funding more than doubled year on year, from 1.3% in Q1 2022 to 2.7% in Q1 2023, due to a significant increase in interest rates between the two periods, as interest expense increased from $25.8 billion in Q1 2022 to $70.8 billion in Q1 2023.
This had an effect on the net interest margin (NIM), which fell from 7.3% to 6.9% over the same time period.
Total assets increased by 9% from 12.29 trillion in December 2022 to 13.36 trillion in March 2023, owing primarily to increases in customer deposits and other funding sources such as borrowings. Customer deposits increased by 2% between December 2022 and March 2023, rising from $8.98 trillion to $9.14 trillion.
Loans and advances increased marginally by 1% from 4.12 trillion in December 2022 to 4.15 trillion in March 2023 as customers adjusted to the full impact of higher interest rates on risk assets. Both the capital adequacy and liquidity ratios remained strong at 19.5% and 72%, respectively, comfortably exceeding regulatory thresholds.
As it restructures into a holding company, introduces new verticals to its businesses, and expands into new frontiers in 2023, the Group will maintain its focus on sustainable growth across all business segments.
Zenith Bank’s consistent record of outstanding performance has earned the brand numerous accolades, including being named the Number One Bank in Nigeria by Tier-1 Capital for the 13th consecutive year in The Banker Magazine’s 2022 Top 1000 World Banks Ranking.
The bank was also named Bank of the Year (Nigeria) in The Banker’s Bank of the Year Awards 2020 and 2022, as well as Best Bank in Nigeria in the Global Finance World’s Best Banks Awards for three consecutive years, from 2020 to 2022.
