Zenith Bank (Ghana) Limited has demonstrated an impressive financial performance in the First Quarter (Q1) of 2024, with notable growth in profitability, liquidity, and capital adequacy.
The Bank’s unaudited financial statements for the period highlighted a continuation of its strong performance from 2023, with a remarkable 41.03 percent year-on-year increase in profitability to GH¢306.5 million, compared to GH¢217.3 million in the corresponding period of 2023.
This exceptional performance was primarily attributed to significant growth in both interest income and non-interest income. Interest income surged by 59 percent to GH¢437.6 million in Q1 2024 from GH¢275.2 million in Q1 2023.
As a result, net interest income, representing the variance between interest income and interest expense, also experienced a substantial surge of 59.2 percent to GH¢302.2 million in Q1 2024, up from GH¢189.8 million in Q1 2023.
Additionally, fees and commission income increased by 9.6 percent to GH¢64.3 million in Q1 2024 compared to GH¢58.7 million in Q1 2023. This growth, coupled with trading income of GH¢91 million, contributed to diversifying Zenith Bank’s revenue sources.
Furthermore, the Bank’s balance sheet reflected strategic expansion, with total assets expanding by 39.6 percent to GH¢15.1 billion in Q1 2024, from GH¢10.8 billion in the same period of 2023. Particularly noteworthy was the 54.9 percent increase in loans and advances to GH¢2.1 billion in Q1 2024, underscoring the Bank’s dedication to bolstering credit accessibility across various sectors of the economy.
This also suggested a strong demand for credit from businesses and consumers, potentially indicating a pick-up in economic activities.
The growth was also reflected in a GH¢1.75 billion increase in investment securities year on year, underscoring the Bank’s strategic approach to diversifying its portfolio of earning assets.
Deposits from Customers
Deposits from customers reached GH¢12.7 billion in the first quarter of 2024 compared to GH¢9.3 billion last year, indicating a 36.4 per cent increase year on year. This surge not only reflected the growing trust and confidence of the Bank’s clientele but also underscores its reputation for delivering exceptional value and customer service.
Beyond profitability, the Bank maintained a firm grip on its financial well-being. Its liquidity ratio, a key metric for measuring a Bank’s ability to meet short-term obligations, improved to 99.84 per cent in Q1 9f 2024, compared to 92 per cent in the same period last year. This indicated Zenith Bank Ghana’s exceptional capability to manage its cash flow and fulfil its short-term financial commitments.
Furthermore, the Bank boasts an impressive Capital Adequacy Ratio of 31.76 per cent at the end of Q1 of 2024, surpassing the regulatory minimum requirement of 10 percent.
This robust capital adequacy ratio is a testament to the Bank’s strong capital base and its ability to absorb potential losses and maintain financial stability during economic downturns.
Zenith Bank Ghana’s credit quality continues to improve, notwithstanding the growth in risk assets. The Bank’s Non-performing loans ratio dropped from 5.05 per cent in Q1 of 2023 to 2.14 per cent in Q1 of this year, suggesting credit risk management strategies are proving effective, leading to a high-quality loan portfolio.
Mr. Henry Onwuzurigbo, the Managing Director/CEO of Zenith Bank (Ghana) Limited, assured that, “Our approach is to deepen our understanding of customer needs and to provide financial solutions that will foster beneficial synergies for all stakeholders.”
Mr. Onwuzurigbo noted that the bank’s commitment to this strategy has been pivotal in achieving the remarkable results seen today, and “we remain extremely grateful to customers for the beneficial relationship over the years. We will continue to team up with them for excellence in the remaining quarters of the year.”
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