Shareholders
of Zenith Bank Plc should expect higher dividend at the end of the current
financial year given the impressive results the bank has recorded for the nine
months ended September 30, 2016.
According
to results released monday, Zenith Bank recorded gross earnings of N380.4
billion in 2016, showing an increase of 12.9 per cent from N337.9 billion in
the corresponding period of 2015. Net interest income grew by 17.6 per cent
from N161.4 billion to N189.8 billion, while impairment charges rose by 124.8
per cent to N9.7 billion to N21.9 billion. However, other income soared from
N9.7 billion in 2015 to N32 billion in 2016.
Hence,
Zenith Bank ended the period with profit before tax (PBT) of N121.2 billion,
showing an increase of 16.6 per cent above the N104 billion posted in the
corresponding period of 2015. Profit after tax (PAT) recorded faster growth of
20.4 per cent to N100 billion, up from N83 billion.
Also,
the bank attracted more deposits and also gave out more loans and advances.
Deposits rose from N2.557 trillion to N2.692 trillion, while loans and advances
grew from N1.841 trillion to N2.425 trillion. Total assets hit N4.654 trillion,
up from N4.0 trillion in 2015.
Reacting
to the results, analysts at FBN Quest said given the nine month profit before
tax of N121 billion, the N123 billion made by the management for the full year
would be surpassed.
The
analysts said:” On the back of these results, we would expect consensus PBT for
2016 to move up strongly, from N123bn currently, given that the nine months
result is N121 billion. The operating expenses and interest expense figures are
disappointing and would draw some scrutiny from the market. However, we expect
the fx-related gains to more than compensate for these, given their magnitude
and the fact that it was the absence of such gains in second quarter (Q2)
(especially on the non-interest income line) that led to a muted to negative
reaction by the market.”
Also
assessing the results, analysts at Cordros Capital Limited said
Zenith
Bank reported an increase in earnings per share (EPS) to N3.18 for the period,
compared with an EPS of N2.64 in the previous year. Return on average equity
(RoAE) improved to 19.2 per cent versus the 14.8 per cent recorded as at the
previous quarter.
“The
result was impressive, outperforming both management guidance and consensus
estimate,” they said. Source: ThisDay Nigeria
