Shareholders of Zenith Bank Plc, on Tuesday at the 30th Annual General Meeting of the Bank held at the Civic Centre, Victoria Island, Lagos, unanimously approved the proposed final dividend of N2.70 per share, bringing the total dividend payout for the 2020 financial year to N3.00 per share amounting to a total of N94.19 billion.
This followed the recent release of the bank’s audited financial results for the 2020 financial year, where profit before tax (PBT) rose by 5 per cent to N255.9 billion from N243.3 billion reported in the previous year amidst a challenged macro-economic environment hobbled by the COVID 19 pandemic.
The increase arose from a mixture of growth in the topline and a significant reduction in interest expense from N148.5 billion in 2019 to N121.1 billion in 2020, significantly increasing the net interest income from NGN267.0 billion in 2019 to NGN299.7 billion in 2020.
The Group recorded a growth in gross earnings of 5 per cent from N662.3 billion in the previous year to N696.5 billion. The Group recorded 8 per cent growth in non-interest income from NGN232.1 billion in 2019 to NGN251.7 billion in 2020 and a 1 per cent increase in interest income from NGN415.6 billion in 2019 to NGN420.8 billion in 2020.
The Group’s increased retail activities translated to a corresponding increase in retail deposits and loans. Thus, retail deposits grew by NGN612.7 billion from NGN1.11 trillion to NGN1.72 trillion year-on-year (YoY), while savings balances significantly grew by 88 per cent YoY and closed at NGN1.16 trillion. This retail drive, coupled with the low-interest yield environment, helped reduce the cost of funding from 3.0 per cent to 2.1 per cent and reduced interest expense. However, the low-interest environment also affected the net interest margin, which declined from 8.2 per cent to 7.9per cent in the current year due to the re-pricing of interest-bearing assets. Operating costs grew by 10 per cent YoY but are still tracking well below inflation which at the end of the year stood at 15.75 per cent. Although returns on equity and assets also reduced from 23.8 per cent to 22.4per cent and from 3.4 per cent to 3.1per cent, respectively, the Group still delivered improved Earnings per Share (EPS), which grew 10 per cent from NGN6.65 to NGN7.34 in the current year.
In recognition of its track record of excellent performance, Zenith Bank was voted as Bank of the Year (Nigeria) in The Banker’s Bank of the Year Awards 2020, Best Bank in Nigeria in the Global Finance World’s Best Banks Awards 2020 and Best Corporate Governance ‘Financial Services’ Africa 2020 by the Ethical Boardroom. Also, the bank emerged as the Most Valuable Banking Brand in Nigeria, for the fourth consecutive year, in the Banker Magazine “Top 500 Banking Brands 2021” and Number One Bank in Nigeria by Tier-1 Capital in the “2020 Top 1000 World Banks” Ranking published by The Banker Magazine.