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Zenith Bank Plc 2017FY Conference Call and Earnings Presentation - The Key Takeaways

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Wednesday, March 14, 2018 05:46 PM / Proshare Markets


Zenith Bank Plc held its 2017FY Investors and Analyst Conference Call Earnings Presentation. Proshare NG participated along with leading market analysts and professionals.
 

In reviewing the Nigerian Economy and Key developments in the banking sector, the bank stated that Nigeria remains Africa’s largest economy with strong sector and significant opportunities with an improving macroeconomic environment as key economic indicators such as GDP, Headline Inflation, Oil Price and Production, Foreign Reserves and Exchange Rate which has remained stable depict.
 

The bank recorded 46% growth in Gross Earnings to close FY2017 with N745.18bn for the group and a strong bottom-line profitability, driven by this robust core earnings generation and continued cost control to deliver improved operating leverage. The bank delivered an attractive earnings profile supported by increasing revenue and improving efficiency inspite of the macroeconomic backdrop.
 

Also, the bank recorded an attractive 23% YoY growth in interest income to support the Bank’s net interest margin and this growth in interest income is attributed to the high yielding environment in 2017.
 

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The bank’s capital and liquidity ratios are well above  industry requirements of 30% for Liquidity and 15% for Capital Adequacy Ratio while its capital mix reflected that its capital base is predominantly made up of Tier 1 (core capital) which consists of  mainly share capital and reserves created by appropriations of retained earnings.
 

In a nutshell, below are the key takeaways from the 2017FY earnings presentation made by the bank’s management;
 

1. Nigeria continues to be the main driver of profitability, providing about 90% of gross revenue

2. The bank continue to record c
ontinuous diversification and improved profitability across core business segments

3. It has a well-diversified loan portfolio across sectors which supports its asset quality based on its focused risk management via portfolio diversification.

4. Its liquidity buffer is well in excess of regulatory requirements; and

5. As part of its strategy to drive its vision, the bank intends to compete aggressively for market share, but focus on high quality assets and top-end relationships while adopting cost reduction strategies
 

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