Zenith Bank Plc, one of Nigeria’s premier financial institutions, has made history with its exceptional financial performance for the fiscal year 2023. The bank recently unveiled its audited accounts, revealing gross earnings of a staggering N2.13 trillion.
This remarkable figure represents a remarkable growth of 125.4% year-on-year and stands as the highest gross earnings ever reported in the company’s storied history.
Key Highlights of FY 2023 vs FY 2022:
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Gross Earnings: N2.13 trillion, +125.4% YoY
Net Interest Income: N736.18 billion, +100.8% YoY
Net Income on Fees and Commission: N109.31 billion, -17.7% YoY
Trading Gains: N566.97 billion, +166.6% YoY
Profit Before Tax: N795.96 billion, +179.6% YoY
Profit After Tax: N676.91 billion, +202.3% YoY
Earnings per share: N21.55, +201.8% YoY
Loans and Advances: N6.57 trillion, +63.4% YoY
Total Assets: N20.37 trillion, +65.8% YoY
Total Shareholders’ Equity: N2.32 trillion, +68.5% YoY
Retained Earnings: N1,179,390 vs N625,005
Proposed Dividends: N3.50 per share (Total for the year N4 per share).
Zenith Bank’s extraordinary performance is underscored by its significant surge in interest income, which amounted to a staggering N1.1 trillion. However, the bank also made a substantial provision of about N409.6 billion, which reduced its Net Interest Income after provisioning to N326.5 billion. This provision may be linked to challenges in utilizing retained earnings for dividend payments, especially following the central bank’s decision to exclude retained earnings from its calculation of a bank’s share capital.
Additionally, Zenith Bank greatly benefited from foreign exchange rate dynamics, accruing an estimated N228.9 billion from forex revaluation gains. The bank also reported impressive trading gains of N566.9 billion. Interest income from treasury bills in 2023 skyrocketed to N179.0 billion, marking a remarkable 310.4% growth from the previous year.
Moreover, interest income from government and other bonds reached N187.4 billion in 2023. Notably, electronic product fees emerged as a major contributor to fees and commission income, amounting to N51.8 billion, representing a 13.3% increase from the previous year.
Zenith Bank’s capital adequacy ratio climbed to 22% in 2023, up from 20% in the preceding year, further solidifying its financial strength and stability in the market.
Guaranty Trust Holding Achieves Remarkable Growth in FY 2023
Also, Guaranty Trust Holding made significant strides in the fiscal year 2023, as evidenced by its impressive financial performance. The holding company reported a gross earnings figure of N1.187 trillion, representing a remarkable increase of 120.03% from the previous year’s earnings of N539.235 billion.
A cursory review of the financial statements reveals that interest income emerged as a substantial contributor, constituting 46.42% of the gross earnings. This underscores the importance of interest income in driving the company’s revenue generation efforts.
Furthermore, Guaranty Trust Holding reported a robust profit before tax of N609.308 billion for the year ended December 31, 2023. In line with its commitment to shareholder value, the company proposed a final dividend of N2.70 per share.
A notable shift in the composition of gross earnings occurred compared to the previous year, with foreign exchange (FX) revaluation gains playing a more significant role. In FY 2023, FX revaluation gains contributed 37.24% to the gross earnings, reflecting a notable increase from the previous year’s contribution of 10.74%.
Key highlights of FY 2023 compared to FY 2022 include:
Gross earnings: N1.187 trillion, +120.03% YoY
Interest Income: N550.755 billion, +69.25% YoY
Interest Expense: N114.059 billion, +72.56% YoY
Net interest income: N436.697 billion, +68.41% YoY
Loan impairment charges: N102.953 billion, +758.91% YoY
Net fees and commission income: N109.428 billion, +18.95% YoY
FX revaluation gain: N441.791 billion, +662.54% YoY
Other operating expenses: N122.429 billion, +31.56% YoY
Profit for the period: N539.655 billion, +218.99% YoY
Earnings per share: N19.05, +220.17% YoY
Loans and advances to customers: N2.480 trillion, +31.52% YoY
Cash and bank balances: N2.310 trillion, +42.47% YoY
Total Assets: N9.691 trillion, +50.33% YoY
Customers’ deposits: N7.411 trillion, +65.23% YoY
Share capital & share premium: N138.187 billion
Retained earnings: N580.024 billion, +169.96% YoY
The commentary accompanying the financial results indicates that interest income remains a major driver of gross earnings, primarily fueled by growth in loans and advances.
However, the company has strategically reduced its reliance on loans and advances by increasing exposure to investment in debt securities, thereby diversifying its risk profile and enhancing the stability of its balance sheet.
Furthermore, Guaranty Trust Holding’s conservative lending policy likely contributed to the moderation of its loan provision to N103 billion. This prudent approach underscores the company’s commitment to managing risk effectively while maximizing shareholder value.
We are witnessing the largest wealth transfer in the history of Nigeria. Naira devaluation has significantly decreased the purchasing power of every Nigerian and Nigerian business, driving up the cost of food, goods, and services. However, the banks have become significantly richer from the revaluation.
The fact that Nigerians are not protesting in front of the central banks and other banks in the country demanding forced redistribution of the ridiculous bank gains (as support for the Naira) shows that the people are mostly subdued.
It seems that all the doubling of the total amount of Naira that happened in the last administration went directly to the banks. If all the banks’ gains in the country are added together, I am sure it will be very close to all the 20+ trillion Naira that the Central Bank of Nigeria essentially printed into circulation through ways and means.
Without seeing a conspiracy, it appears that the banks—especially with their friends at the apex banks—printed money for themselves and left the bill and debt to the Nigerian people. We should simply take the money and pay off the printed ways and means bill that was recently securitized.
This is why the country is already becoming dollarized. We are still spending Naira, but many young middle-class salary workers in Nigeria, who understand technology, are saving the rest of their salary in USDT, Bitcoin, or Dom accounts. Almost everyone has a Dom account these days. Prices of goods are in Naira, but price stability is nowhere to be found because goods are repriced based on the current dollar rate, and profits are quickly converted to dollars or their stable equivalents.
The fallacy is that even the dollar isn’t stable.
Many hard-working Nigerians like myself now have to go through the dance of looking for dollars and buying USDT or Bitcoin with the savings from my salary every month. It is really unfortunate.
But the banks somehow made all the money.
We need a currency government and banks cannot print. I thought Bitcoin was a scam for a long time but Nigeria opened my eyes that Naira is the bigger scam.
What is the Naira – The Naira is a currency the banks in Nigeria print at will, declaring profits for themselves while Nigerians look on as the value of everything they own depreciates.
“If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.”
“I sincerely believe that banking establishments are more dangerous than standing armies, and that the principle of spending money to be paid by posterity under the name of funding is but swindling futurity on a large scale.” –Thomas Jefferson to John Taylor, 1816.