Zenith Bank overcome economy challenges, increases profit to N129.7bn in 2016
By Kayode Ogunwale

 
DESPITE numerous challenges facing business environment in Nigeria, Zenith Bank Plc has reported N126.652 billion as profit after tax in 2016.
The Tier I lender’s in its financial report for the year ended 31 December 2016 released to the Nigerian Stock Exchange (NSE) today in Lagos, recorded an increase of N20.989 billion in profit after tax from N105.663 billion it made in 2015 financial year.
Zenith Bank Plc’s retained 24.93 percent of its gross earnings as after tax profit in 2016 as against 24.43 percent it retained during the same period of 2015.
Gross earnings of the group increased by N75.462 billion or 17.45 percent from N432.535 billion made in 2015 to N507.997 billion at the end of 2016 financial year.
The bank spent 28.42 percent of its gross earnings on interest and similar expenses during the year 2016 which amounted to N144.378 billion as against 28.58 percent (N123.597 billion) spent in 2015.
Also, Zenith Bank spent N94.365 billion on operation in 2016 compared to N89.928 billion spent on the same purpose during the year 2015.
It expended N69.042 billion on personnel in 2016, higher than N67.522 billion spent during the 2015 financial year.
The lender’s boost its business by improving on customers’ deposits from N2.558 trillion in 2015 to N2.984 trillion at the end of 2016 financial year. Zenith Bank customers deposits rose by N426 billion represented 16.65 percent in 2016.
Loans and advances of the bank increased by 15 percent, translated to N300 billion during the year under review, from N1.989 trillion in 2015 to N2.289 trillion in 2016.
The bank’s retained earnings stood at N267.008 billion at the end of 2016 financial year as against N200.115 billion retained in 2015 financial year.
It earnings per share rose by 22.62 percent (76 kobo) from 336 in 2015 to 412 kobo in 2016. While the shareholders funds jacked up from N594.353 billion of 2015 to N704.465 at the end of 2016.
The board of directors of Zenith Bank, pursuant to the powers vested in them by the provisions of section 379 of the Companies and Allied Matters Act (CAMA) of Nigeria, proposed a final dividend of N1.77 kobo per share which in addition to the N0.25kobo per share paid as interim dividend amounts to N2.02 kobo per share (31 December 2015: N1.80 kobo per share) from the retained earnings account as at 31 December 2016. The proposed dividend will be presented to the shareholders for approval at the next annual general meeting.
If the proposed dividend is approved by the shareholders, the bank will be liable to pay additional corporate tax estimated at N12.52 billion representing the difference between the tax liability calculated at 30 percent of the dividend approved and the tax charge reported in the statement of profit or loss and other comprehensive income for the year ended 31 December 2016.
Payment of dividends is subject to withholding tax at a rate of 10 percent in the hand of qualified recipients.