Zenith Bank Plc third quarter 2016 profit after tax grew by 20.44 per cent to N100.074 billion from N83.087 billion recorded a year earlier.
In a filing from the Nigerian Stock Exchange (NSE), the group’s pre-tax profit also rose by 16.55 per cent from N104.052 billion during the previous year to N121.275 billion during the period under review.
Its gross earnings equally increased by 12.91 per cent from N336.853 billion in 2015 to N380.352 billion during the third quarter of 2016. Exotix Research in its latest report said continued strong quarterly increase in loan book indicates growth in real terms. The financial analysts noted that the bank’s gross loans increased by 22.5 per cent YTD and 6.4 per cent qoq to N2,491 billion (vs FY16f N2,447billion).
“While it is hard to evaluate the impact of FX devaluation on a YTD basis (because the bank converted a significant and unspecified proportion of its US$ loans to NGN), we think the loan book has increased in real terms during Q3.
Based on a US$-denominated loan book of NGN664bn equivalent as at H1 16, a devaluation of 11.6 per cent would have increased its overall loans by N77 billion compared to the N150.7 billion announced by the bank. We therefore estimate real loan growth of 3.1 per cent qoq.
We consider the growth in real terms both encouraging and concerning at the same time given the negative macroenvironment,” they said.
The experts added that noninterest revenue boosted by FX gains but source of the same remains opaque. According to them, non-interest revenue increased by 18.2 per cent yoy to N94.7 billion (238.6 per cent qoq to N61.3 billion and our FY16f of N84.4 billion) largely driven by a YTD FX revaluation gain of N31.0 billion, of which N28.2 billion was recorded in Q3.
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