By InvestAdvocate
Lagos (INVESTADVOCATE)- Nigeria’s top tier lender, Zenith Bank Plc said on Monday its pretax profit for the nine-month period ended September 30, 2016 rose 16.6 percent to N121.3 billion from N104.1 billion reported a year ago.
Post-tax profit for the period also grew 20.4 percent to N100.1 billion from N83.1 billion declared the same period of last year.
Gross earnings of the Bank rose N336.8 billion in the nine-month period of 2015 to N380.3 billion reported the review period of 2016; indicating a rise of 12.9 percent, Zenith Bank said in a filing with the Nigerian Stock Exchange (NSE).
Cordros research say the 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, while return on average equity (RoAE) improved to 19.2 percent compared to 14.8 percent recorded as at the previous quarter. “The result was impressive, outperforming both management guidance and consensus estimate,” Cordros said.
According to Cordros, net interest income improved by 17.6 percent year-on-year (y/y), but unlike both of its peers (UBA and GUARANTY) that have released 9M’16 results in which they reported significant quarter-on-quarter (q/q) expansions in net interest income, ZENITHBANK reported an 8.8 percent q/q decline. “Interestingly, interest income grew by only 7.2 percent q/q (even after year-to-date (YTD) loan growth expansion increased to 21.9 percent from 17.2 percent as at H1’16) while interest expense jumped by 46.2 percent q/q (as YTD customer deposit growth only increased marginally to 5.2 percent from 5.0 percent in the previous quarter).
The Cordros report says non-interest income grew an impressive 17.9 percent y/y after a Q3’16 surprise where it jumped by 283.6 percent q/q. “The q/q growth was spurred by a massive improvement in foreign exchange related income. Foreign exchange trading income and foreign currency revaluation gains grew to N14.6 billion and N28.1 billion, from YTD loss of N2.8 billion and YTD gain N2.8 billion recorded as at H1’16 respectively,” the report added.
Also, impairment charge expanded 124.8 percent y/y but fell by 35.8 percent q/q, while operating expense climbed 10.5 percent y/y and 32.4 q/q respectively.
