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Resilient Zenith Bank Beats Market Expectations with Double-Digit Growth in Gross Earnings in 2021

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Zenith Bank Plc has announced an impressive result for the year ended December 31, 2021 as it recorded a double-digit growth of 10 per cent in gross earnings which rose to N765.6 billion from N696.5 billion reported in the previous year.

This was despite a challenging macroeconomic environment aggravated by the coronavirus (COVID-19) pandemic.

According to the bank’s audited financial results for the 2021 financial year presented to the Nigerian Exchange Group (NGX), the Group achieved 10 per cent year-on-year (YoY) growth in gross earnings on the back of 23 per cent YoY growth in non-interest income from N251.7 billion to N309 billion and a two per cent YoY growth in interest income from N420.8 billion to N427.6 billion.

Also, Zenith Bank’s profit before tax (PBT) grew by 10 per cent from N255.9 billion to N280.4 billion in the current year under review. The increase in PBT was due to growth in the bank’s top-line and very strong management of the treasury portfolio that increased efficiency, resulting in a drop in interest expense by 12 per cent from N121.1 billion in 2020 to N106.8 billion in the year under review.

This further led to a seven per cent increase in net interest income of N320.8 billion in 2021, from N299.7 billion in 2020.

Its customer deposits increased by 21 per cent, growing from N5.34 trillion in the previous year to N6.47 trillion in 2021.

The growth in customer deposits came from both corporate and retail customers. For instance, while retail deposits grew by N146 billion from N1.72 trillion in 2020 to N1.87 trillion in 2021.

The Group’s continuous drive for retail deposits combined with the strategic rebalancing of its funding base helped to reduce the cost of funding from 2.1 per cent to 1.5 per cent in the current year.

Although operating expenses grew by 13 per cent YoY, growth remained below the inflation rate, and the Group improved its Earnings per Share (EPS) which grew by six per cent from N7.34 to N7.78.

Zenith Bank’s total assets also increased by 11 per cent, growing from N8.48 trillion in 2020 to N9.45 trillion in 2021, mainly driven by growth in customer deposits. With the steady recovery in economic activities, the Group prudently grew its gross loans by 20 per cent, from N2.9 trillion in 2020 to N3.5 trillion in 2021, with moderated non-performing loan (NPL) ratio from 4.29 per cent to 4.19 per cent YoY.

Furthermore, the Group recorded impressive liquidity and capital adequacy ratios of 71.6 per cent and 21 per cent, which remained above regulatory thresholds of 30 per cent and 15 per cent respectively.

In 2022, the Group intends to consolidate on the gains achieved in the previous year in all business segments and combine leadership in the industry, innovation and technology to drive improved performance and deliver enhanced returns to all stakeholders.

As a testament to its commitment to its shareholders, the bank has announced a proposed final dividend pay-out of N2.80 per share, bringing the total dividend to N3.10 per share.

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Zenith Bank has continued to distinguish itself in the Nigerian financial services industry through superior service offerings, unique customer experience and sound financial indices. The bank remains a clear leader in the digital space with several firsts in deploying innovative products, solutions and an assortment of alternative channels that ensure convenience, speed and safety of transactions.

In recognition of its track record of excellent performance, Zenith Bank was voted as Best Commercial Bank in Nigeria in the World Finance Banking Awards 2021, Best Bank in Nigeria in the Global Finance World’s Best Banks Awards 2020 and 2021, Bank of the Year (Nigeria) in The Banker’s Bank of the Year Awards 2020, and Best in Corporate Governance ‘Financial Services’ Africa 2020 and 2021 by the Ethical Boardroom. Also, the bank emerged as the Most Valuable Banking Brand in Nigeria in the Banker Magazine Top 500 Banking Brands 2020 and 2021, Number One Bank in Nigeria by Tier-1 Capital in the “2021 Top 1000 World Banks” Ranking by The Banker Magazine and the Retail Bank of the year at the BusinessDay Banks and Other Financial Institutions (BOFI) Awards 2020 and 2021.

Similarly, Zenith Bank was honoured as Bank of the Decade (People’s Choice) at the THISDAY Awards 2020 and emerged winner in four categories at the Sustainability, Enterprise, and Responsibility (SERAS) Awards 2021, carting home the awards for “Best Company in Reporting and Transparency”, “Best Company in Infrastructure Development”, “Best Company in Gender Equality and Women Empowerment”, and the coveted “Most Responsible Organisation in Africa.

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