Zenith Bank’s gross earnings increased by 139% in the first half of the year, from N404.8 billion to N967.3 billion, thanks to higher interest revenue and gains from currency revaluation.
The Punch reported that the banking group’s H1 2023 report, which was submitted on Monday to the Nigerian Exchange Limited, shows that at the end of June 2023, earnings after tax increased by 161.84 percent to N291.7 billion.
The financial institution’s board of directors also suggested an interim dividend of 50 Kobo, which was 66.67% larger than the payout of 30 Kobo for the same period in 2022.
Trading profits increased by 21% to N103 billion over this time, while interest income increased by 72% from N241.7 billion in H1 2022 to N415.4 billion.
The influence of both the expansion and repricing of risk assets was cited as the cause of the increase in interest income. The period’s liberalization of the foreign exchange market encouraged an increase in non-interest income as revaluation gains dramatically improved.
Due to an improved income line, the bank’s cost-to-income ratio increased, going from 58.8% to 38.5% in the first half of 2023. The cost of risk increased from 1.4% to 8.8% due to the liberalization of the foreign exchange market and the increased risk environment.
Due to the increase in interest rates between the two periods, which caused interest expense to increase from N57 billion in H1 2022 to N153.6 billion in H1 2023, the cost of funding also increased year over year throughout the period under review, rising from 1.4% in H1 2022 to 2.6% in H1 2023.
The bank’s total assets increased by 31% from N12.3 trillion in December 2022 to N16 trillion in H1 2023, primarily due to growth in customer deposits and the local currency’s depreciation. Deposits from customers increased from N9 trillion in December 2022 to N11.6 trillion.
Additionally, loans and advances increased by 32% from N4.12 trillion in December 2022 to N5.38 trillion during the course of the review period, partially as a result of the revaluation of the foreign currency-denominated loans as well as growth in local currency loans.
