Zenith Bank (ZENITHBANK) Q4 2024 earnings summary

Executive summary

• Gross earnings grew 86% year-over-year to NGN 3.97 trillion, driven by a 138% increase in interest income and strong loan book expansion.

• Profit before tax rose 67% to NGN 1.33 trillion, and profit after tax increased 53% to NGN 1.03 trillion, making the institution the most profitable bank in Nigeria.

• Total assets grew 47% to NGN 30 trillion, and customer deposits surged 45% to NGN 22 trillion, reflecting robust balance sheet growth.

• All subsidiaries were profitable, with notable PBT growth in the UK (71%) and Sierra Leone (262%), and foreign subsidiaries’ revenue contribution grew 82% YoY.

• The bank completed a major IT transformation, expanded internationally with a Paris office, and is planning further African expansion.

Financial highlights

• Interest income reached NGN 2.7 trillion, up 138% year-over-year, while interest expense rose 143% to NGN 992 billion.

• Net interest income increased by 135% to NGN 1.73 trillion, with net interest margin rising from 7.3% to 9.5%.

• Non-interest income grew 20% to NGN 1.1 trillion, with net trading profits up 94% and net fees and commissions up 89%.

• Operating expenses rose 88% to NGN 843 billion, with cost-to-income ratio increasing to 38.9%.

• Earnings per share climbed 53% to NGN 32.87.

Outlook and guidance

• FY2025 profit before tax guidance set at NGN 1.5 trillion, with deposit and loan growth targets of 20% each.

• Targeting ROAE of 30%, ROAA of 4%, NIM of 9%, and cost-to-income ratio of 40%.

• Cost of risk guidance for 2025 is 7%, reflecting expectations of a more stable economic environment.

• Dividend payout ratio is expected to be at least 20%, with potential to return to historical levels of 48% as stability improves.

• Continued focus on digital transformation, international expansion, and optimizing treasury returns.