ZENITH BANK LOOKING AHEAD WITH SUPPORT

Zenith Bank PLC apparently has it's eyes fixed beyond the moment with some prop even though crisis looms over Nigerian finance.

According to the figures for nine months to September released yesterday, Zenith bank dished out N20028m as capital expenditure within the period with N16747m deployed in Nigeria and N3436m in Africa.

Yet in recognition of the challenges of the times, it topped its provision for toxic loans by 127.6% to N21858m at a time its loans and advances portfolio closed only 31.7% up.

At the same time, the unaudited figures say in spite of the challenges Zenith bank was heading for double digit growth in profit since with three months to go N121275m was in the bag, up 16.6% from 12.9% rise in gross earning to N380352m.

Of course, the main prop came not from 11.3% increase in interest income to N285674m ( this helped greatly no doubt) but from quantum leap in gains from foreign exchange related revaluation which pushed Other income up by 229.7% to N31986m.

After all income from fee and commission was disappointing at N46282m, down 15.1% and less so too for trading income which recorded 3.12% increase to N16410 despite leap in foreign exchange trading income to N11780m from N9421m

With the prop in place, Zenith bank recorded only 0.55% growth in interest expense to N95857m to make interest income growth count more.

Then it succeeded in keeping personnel cost increase at 5% but failed to work the same magic with other operating expenses which ended 15.7% up at N54911m.

Thus, the years cake was almost done with and indeed look set to get bigger when eventually foreign exchange related differential gain of N52230m and fair value change of N5453m are added.

So looming crisis? Well likely but Zenith bank, says the nine months figures will ride it on the back of increased foreign earnings, and some paper profits since the group reporting currency, Naira, continues to search for a true bottom.

ZENITH BANK: Nm.  Nine months
                        2016.           2015
Gross income 380352.   336853
Interest inc.    285674.    256737
" expense.        95857.      95337
Impairment.     21858.       9725
Fee & comm.   46282.      54500
Trading income 16410.    15914
Other income.    31986.      9702
Personnel.          54911.    52296
Op. Expenses.    78291.    67661
Profit b4 tax     121275.  104052
Loans.             2425328 1841392
Deposits.        2691985  2521828
Fx difference     52230.        958
Fair value gain    5453.    (2390)
  

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