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Zenith Bank Post N676.9bn Profit For 2023
Yinka Olajoyetan, Lagos 
Zenith Bank Plc posted a jumbo net profit of N676.9 billion for last year, its strongest on record, bettering the bottom line of the preceding year by more than three times.
2023 was a banner year for most Nigerian banks as the Central Bank of Nigeria (CBN) raised the monetary policy rate to 18.75 per cent in its race to soften the country’s irrepressible inflationary pressures, in turn allowing lenders to charge more for loans.
That was the biggest spur for Zenith Bank’s remarkably strong result, with interest & similar income contributing more than half of revenue, which quickened to N2.1 trillion from N945.6 billion a year earlier, according to its audited earnings report published on Monday
During the review period, Zenith Bank provisioned N409.6 billion to cover sticky loans and advances not likely to be repaid by borrowers. The sum was more than thrice what it allocated for that purpose in 2022.
Net income on fees & commission came in 17.7 per cent weaker on account of a bulge in fees & commission expense, which soared 179. 3 per cent to N68.2 billion.
Zenith Bank is in the middle of a transition into a holding company, an operating structure which is helping peers like Access Holdings, FBN Holdings, Guaranty Trust Holding Company, Stanbic IBTC Holdings, FCMB Group and Sterling Financial Holdings Company branch out into other sectors within the financial industry and diversify risk.
Last month, the lender secured a court order to hold a meeting of shareholders this month, a critical phase on its path to becoming a holding company, and could complete the process before the year winds down.
Helping profit, the financial institution recorded a 166.5 per cent jump to N567 billion in trading gains. In like manner, other operating income accelerated to N242.6 billion from N35.5 billion, with a much higher foreign currency revaluation gain to thank for it.
A significantly weaker naira, following two devaluation rounds that set the local currency up for a 70 per cent slide in 2023, was another big win for lenders, notably those holding some of their assets in foreign currencies.
It means income from those assets rose tremendously after conversion to local currency, with Zenith Bank earning last year more than nine times the cash it generated in foreign currency revaluation gain in 2022.
Profit before tax rose to N796 billion from N284.7 billion, while post-tax profit climbed to N676.9 billion from N223.9 billion a year earlier.
The lender earned N162.9 billion from currency translation differences for foreign operations in contrast to a loss of N28.8 billion a year ago and generated other extraordinary incomes that took its total comprehensive income for the year to N1.1 trillion. That sum compares to the N196.7 billion recorded one year prior.
Lenders in Nigeria are forbidden from paying dividends from windfall income from foreign exchange gains.
Zenith Bank and other rivals operating internationally are in the race to buck up capital buffers and raise their minimum capital to N500 billion in the next 24 months, ten times higher than the current capital base, after the apex bank gave them the tall order last month
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