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Zenith Bank Records Improved Half Year 2019 Results, With Interim Dividends Of 30 Kobo Per Share

Gbemileke Ajayi

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In a clear demonstration of its resilience and strong market share, Zenith Bank Plc has announced its audited results for the half-year ended 30 June 2019, recording positive growth across key financial metrics, thus affirming the bank’s position as one of the leading financial institutions in Africa.

As a testament to its commitment to its shareholders, the bank also announced a proposed interim dividend pay-out of 30 kobo per share.

Gross earnings grew by 3% from ₦322.2 billion to ₦331.6 billion driven by the significant growth of 24% (YoY) in non-interest income from ₦88.6 billion in H1 2018 to ₦109.7 billion in H1 2019. In particular, fees from electronic products increased by ₦17bn (168%) from ₦10bn in H1 2018 to ₦27 in H1 2019, demonstrating significant progress in our retail banking initiatives. This top-line growth filtered through to the bottom-line as Profit Before Tax (PBT) increased to ₦111.7 billion reflecting a 4% growth over ₦107.4 billion reported in H1 2018 with earnings per share (EPS) increasing by 9% to ₦2.83 in H1 2019 from ₦2.60 compared to the prior period.

Between December 2018 and June 2019, the Group’s total deposit increased by 3% with retail deposits growing by ₦267 billion (31%), from ₦861 billion to close at ₦1.1 trillion. Despite the growth in our deposit base, we optimized interest expense leading to a 4% reduction from ₦74.7 billion to ₦72.1 billion due to the Group’s improved funding mix and our profound treasury management skills. Net Interest Margins (NIMs) witnessed a compression from 10% in the same period last year to 8.6% in H1 2019, as a result of the declining yield environment but the cost of funds improved from 3.4% to 3.0%.

Our robust risk management ensured that our absolute Gross Non-Performing Loans (NPLs) remained flat. However, the marginal movement in NPL ratio was as a result of the 3% reduction in our loan book from ₦2.02 trillion as at December 2018 to ₦1.95 trillion at the end of the period. We are creatively deploying new retail loan products to ensure we capture a reasonable share of the retail loan market. We remain committed to maintaining our strong balance sheet with a liquidity ratio at 74.6% and Capital Adequacy Ratio (CAR) at 25%, ensuring we remain above regulatory thresholds.

Zenith Bank Half Year 2019 Abridged Financials

Going into the second half of the year, we will continue to consolidate our leadership in the corporate space while our retail banking drive will continue unabated. We expect to see an improvement in economic activities even as we maintain our promise of delivering a unique service experience to our customers.

Consistent with this superlative performance and in recognition of its track record of excellent performance, the bank was recently ranked as the Most Valuable Banking Brand in Nigeria in 2018 by The Banker Magazine. Similarly, Zenith Bank was recognized as the Best Corporate Governance Bank in Nigeria by The World Finance for the sixth time just as Ethical Boardroom, a Europe based Boardroom watchdog reaffirmed this recognition by naming the bank as the Best Bank in Corporate Governance in 2018. Recognition has also come the way of the bank as it was recently named as the Best Institution in Sustainability Reporting in Africa 2018 (SERAS Awards) and the Bank of the Year 2018

 

(BusinessDay).

BUSINESS

Heritage Bank Identifies High Prospects In Nigeria’s £4bn Gold Market

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Heritage Bank Plc, Nigeria’s most innovative banking service provider, disclosed that Nigeria’s Gold market is worth £4 billion Pounds with high prospects of profitability for all players in the subsector.

The MD/CEO, Ifie Sekibo, who stated this at the Nigeria-Canada Investment Summit, held in Abuja, yesterday also disclosed that the enormous potential of the industry was one of the reasons why Heritage Bank delved into the mining sector despite enormous risks.

According to him, the bank has Dukia Gold as its partner that would facilitate access to local miners and artisans to get value for their commodity at international market price after being registered with Dukia Gold.

Sekibo, who was represented by the Team Lead, Agric Finance and Export, Adelana Ogunjirin, explained that prior to now, local miners of Gold found it difficult to trade their commodities favorably but with the involvement of Dukia and its partner, Heritage Bank, a Quality-and-Quantity test will be conducted based on the arrangement they made with Dukia Gold and that will lead to added value to the smallholder miners. He explained that this will leverage the small miners the opportunity to also trade their commodities at the international market price.

He further stated that a metric tonne of gold is currently valued at $30million adding that it is worth investing in the industry, especially as gold is a kind of commodity that does not easily lose its value.

He said: “Mining sector is an area which has not been fully tapped in terms of the potentials around it, as there are quite a lot of opportunities around that sector. Recently we secured a $1 billion funding line with our funding partner AfreximBank, which also is to support areas like solid minerals.

“Now with respect to this we have looked at the value chain of this space and we have looked at the opportunities that are there. A lot of fund providers have not really delved into this and it is because of the lack of understanding of the market.

“In terms of value, gold is an area where you can enhance the value. You hardly see Gold losing value and you see that in different exchanges you even trade those commodities.

“Looking at it in terms of trend, you see that gold is something that will appreciate definitely. So in terms of the profitability of this business, we have looked at it, the crunch, the numbers we see that is a space that the Bank will definitely earn a lot of income.”

He also expressed optimism that other banks would like to come into the Nigerian mining sector but maybe studying to understand the sector properly.

“Definitely other banks will come into the sector. For us, we are leading, but the truth is they need to play in an area and space that they understand, as not everybody would be able to play in that space.

“Heritage Bank has already carved a niche for itself in agribusiness space, just like the Gold commodity, this would be exported. So, in terms of export proceeds too, there are opportunities to be explored. Generally, looking at the Nigerian outlook, in the long run, this will also enhance the country’s external reserves. There are multiplier effects of what we are doing today and that is why we are also moving in this direction,” the MD noted.

Also speaking, Managing Director, Nigeria Export-Import Bank, NEXIM, Abba Bello, revealed that the bank had gone into high-level discussions with heavy equipment manufacturers and suppliers that would lease equipment to miners for exploration and processing, adding that this was expected to make the equipment accessible and affordable.

Bello said, “For equipment supplier or outright purchase of equipment, we have gone into discussions with Bluecare and now Mantrac for the supply of heavy equipment for gold processing or exploration on lease basis and, it is something that does not exist currently within the industry.

“Barrick Gold and Bullion Mart is something that happens in the mining world. You don’t have to own the equipment, but there are vendors who supply the equipment for explorers to hire.

“Discussions have gone very far with the equipment suppliers and very soon we will announce the programme.”

Meanwhile, the Country Manager, ITM, Nigeria, Habibah Waziri, raised concerns on human resources development that would sustain the sector.

Waziri also said there is a need to formalize the sector and also invest in human capital in the sector for growth and development.

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UBA Partners With British Airways To Reward Loyal Customers

Peter Okunoren

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Pan African financial institution, United Bank for Africa (UBA) Plc and the global airline, British Airways have announced a collaboration to reward loyal customers who are cardholders of the Bank.

The promo which will last for six months from November 2019, will witness UBA customers getting significant discounts when they purchase their British Airways tickets using their UBA cards. The promo will allow customers to enjoy up between 10% to 15% discount on any ticket purchased during the campaign. The ticket fares is exclusive of taxes as is applicable to purchases of all goods and services.

The collaboration is aimed at increasing customer experience and satisfaction for both UBA Cardholders and customers of British Airways.

The General Manager, Corporate Bank, UBA Directorate, Mr Muyiwa Akinyemi, who expressed delight at the collaboration, noted that the promo between the two organizations was carefully thought out to ensure that loyal customers of the two institutions are duly rewarded while ensuring that they also receive more value for their money. He added that for persons without a UBA account, all they require to benefit from this promo is to procure a card instantly from any UBA branch nationwide.

“UBA is excited to collaborate with one of the foremost Airlines in the world to run a promotion aimed at rewarding our cardholders and premium customers who will enjoy discounted tickets and other ancillary benefits such as loyalty points on the British Airways Executive Club.”

He explained that as a customer-centric institution, UBA is always on the look-out for services and reward schemes that will ultimately benefit the customers, in line with its Customer 1st policy.

Akinyemi noted that the bank has plans to partner with other airlines in the future to provide further opportunities for reducing the cost of travel for its customers. “For now, we are partnering with a pre-eminent airline that offers class and distinction,” he said.

The Commercial Manager for British Airways in West Africa, Mr. Kola Olayinka, noted that the airline is pleased to partner with the bank due to its huge customer base and wide reach, adding that with the partnership, more customers will be able to enjoy the promo.

He said, “British Airways is excited to partner with UBA, Africa’s Global Bank, to create a mind-blowing promotion aimed at raising awareness about this service to be rendered by both institutions.”

Continuing, Kola said, “In addition, the discounts provided by British Airways will reduce the cost of travel and encourage the Bank’s customers to make more foreign trips during the period and also reward their customers and staff as a way of giving them something very tangible.”

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Heritage Bank Convenes Strategic Agribusiness Meeting With Sumitomo Corporation

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L-R: John Gbassa, CEO/MD of WAO Global Trading Ltd; Koji Shirotani, Divisional Manager, Sub-Sahara Africa Business Development Division; Afolasade Alonge, Divisional Head, Corporate and Specialized Banking, Heritage Bank Plc; Masafumi Tanimoto, General Manager, Accra Liason Office; Tsuyoshi Ueda, Assistant Managing Director; Jude Monye, Executive Director of Heritage Bank; Olugbenga Awe, Divisional Head, Agric Finance & Export and Takuya Yamamoto, General Manager, Middle East & Africa, Sumitomo Corporation, during discussion between the Heritage Bank and Sumitomo Corporation on mechanisation & Agric Business, held at bank’s head office, weekend.

Nigeria is at the threshold of the much-needed agricultural revolution, as food production remains a significant challenge all over the world, hence whilst, Heritage Bank Plc is forming an alliance to further create formidable partnership arrangements with Sumitomo Corporation that will lead to impactful agribusiness within the segments of the agricultural value chain.

This relationship that is focused on mechanization and agribusiness will complement the efforts of the Central Bank of Nigeria’s (CBN) to fast track development of the agricultural sector and enhance national food security.

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