Zenith Bank Records 114% Growth, 1.33trn In Q3 2023

Zenith Bank Plc has announced its unaudited results for the third quarter ended 30 September 2023, recording a remarkable triple-digit growth of 114% from N620.6 billion reported in Q3 2022 to N1.33 trillion in Q3 2023. According to the bank, the performance demonstrates the Group’s resilience and strong market share despite a very challenging macroeconomic environment. According to the bank’s unaudited third quarter financial results presented to the Nigerian Exchange (NGX),the triple-digit growth in the topline also enhanced the bottom line, as the Group recorded a 149% Year on Year (YoY) increase in profit before tax, growing from N202.5 billion in Q3 2022 to N505 billion in Q3 2023.  Profit after tax also grew by 149% from N174.3 billion to N434.2 billion in the same period. The growth in the topline arose from both interest income and non-interest income.  Interest income grew in the current period by 72% to N670.9 billion from N390.8 billion in Q3 2022, while non-interest income grew by 186% from N212 billion to N607.2 billion. The growth in profit is similarly attributable to the twin effects of the improvement in interest and non-interest income. Interest income increased because of the growth in risk assets as well as the effective pricing thereon. The non-interest income growth is largely driven by the revaluation gain due to the unification of exchange rates during the year. The cost-to-income ratio reduced from 55.8% in Q3 2022 to 37.8% in the current period.  Impairment levels increased due to the deliberate incremental provisions necessitated by the conservative approach towards the heightened risk environment and the creation of a counter-cyclical buffer needed to deal with any impending volatility of exchange rates.  This caused the cost of risk to deteriorate from 1.3% in Q3 2022 to 5.5% in Q3 2023, however this is an improvement from Q2 2023 where cost of risk printed at 8.8% because of prudent management of risk assets. Total assets grew by 48% from N12.3 trillion to N18.2 trillion in the period ended 30 September 2023, mainly driven by growth in customers’ deposits. Customers’ deposits grew by 49% from N8.98 trillion in December 2022 to N13.38 trillion in September 2023.  The growth in customers’ deposits cuts across both corporate and retail segments with the savings portfolio (all currencies) growing from N2.7 trillion in December 2022 to N4.6 trillion in September 2023. The Group is optimistic of finishing the year 2023 strong, with focus on sustainable quick wins that would boost growth across all business segments and enhance stakeholder value.

Nigeria’s Equity Market Rakes In N564bn

Domestic equity market on Monday opened in bullish note, gaining N564 billion as gain recorded in the shares of Dangote Cement, Nigerian Breweries, Stanbic IBTC, Geregu Power, Flour Mills Nigeria Plc, FBNHoldings impacted positively on the trading activities. Investors’ rekindled interest in stocks led to the appreciation of NGX All Share by 975.13 basis points to 68111.71 points from 67136.58 points traded the previous day. Also, Market capitalisation of listed equities increased by N564 billion or 1.52 per cent to N37.420 trillion from N36.885 trillion it closed on Friday. An analysis of the investment showed that Northern Nigeria Flour Mills led gainers table in percentage terms, gaining 10 per cent to close at N18.15 per unit, Chellaram followed with a gain of 9.77 per cent to close at N3.82 per share, UACN added 9.84 per cent to N14.35 per share, Nahco gained 9.42 per cent to N26.05 per unit, TIP increased by 9.43 per cent to close at N1.16 per unit. On the contrary, Meryer paint recorded the highest loss, declining by 9.87 per cent to close at N2.74 per unit, Abbey Building trailed with a loss of 9.71 per cent to close at N1.86 per share, Regal insurance dropped by 8.33 per cent to N0.33 per share, RTBriscoe dipped by 6.00 per cent to N0.47 per share, Jaiz Bank down by 5.95 per cent to close at N1.58 per unit. Volume of trades during the day increased by 216.247 million, representing 100.98 per cent as investors traded 430.393 million shares valued at N8.257 billion in 7656 deals against 214.146 million shares valued at N5.178 billion in 5325 deals. Transactions in the shares of Universal insurance led market activities with 94.753 million shares valued at N23.105 million, United Bank for Africa followed with account of 51.263 million shares valued at N1.002 billion, Transnational Corporation of Nigeria traded 32.476 million shares cost N200.849 million, Zenith Bank exchanged 24.421 million shares cost N818.460 million while Chams traded 19.243 million shares cost N37.506 million.

Nigeria’s Currency Circulation Jumps To N66.4trn -CBN

The Central Bank of Nigeria CBN) has reported that Nigeria’s total money supply (M2) increased to N66.4 trillion in September 2023. The data from the apex bank on money supply in the economy in the month other review comprising demand deposits, quasi-money, and currency outside banks, reflected increases in the components. Specifically, quasi-money, which pertains to financial tools that can be easily converted to cash, rose from N40.8 trillion in the preceding month to N41 trillion; demand deposits, primarily made up of funds in banks accessible without prior notice, moved from N21.7 trillion to N23 trillion while currency outside banks’ vaults marginally increased from N2.29 trillion to N2.3 trillion. Over the past few years, Nigeria’s money supply has been increasing based on the micro and macroeconomic whirlwinds of the economy, particularly the surging inflation rate, FX pressure on the Naira, and declining interest rates. The money supply, also known as M2, represents the total amount of money available in the economy at a particular moment, including physical currency such as coins and banknotes as well as deposits maintained by individuals, enterprises, and institutions in banks and other financial entities. However, the nation’s Net Foreign Assets dipped in September from N7.1 trillion to just N591 billion while Net Domestic Assets rose to N66.5 trillion from N58.3 trillion. A further analysis of the M2 trend during the month under review showed that the net domestic credit rose from N87.2 trillion to N92.7 trillion, thereby raising the net domestic credit to GDP by around 42.7 per cent. The breakdown of the net domestic credit indicated that credit to the government marginally increased to N34.1 trillion from N32.5 trillion while credit to the organized private sector surged from N54.7 trillion in the preceding month to N58.6 trillion, representing 63% of net domestic credit.

Nigeria’s Insurance Industry Grew N444.2bn In 8 Years – NAICOM

Despite Nigeria’s economic headwinds the country’s insurance experienced a 13 per cent growth in revenue between 2014 and 2022, the National Insurance Commission has said. Commissioner for Insurance, Mr Sunday Thomas, who disclosed this during his welcome address at the National Insurance Conference on Monday in Abuja, also said the Commission mobilized the insurance industry to contribute the sum of N500 million and free Life Insurance cover for front line workers during the COVID-19 Pandemic. He said, “In terms of its performance Your Excellencies, the industry premium income between 2014 and 2022 grew at an average of 13.6%; from a premium income of N282 Billion to N726.2 Billion. The total assets of the sector also grew at an average of 12% for the same period; from an asset base of N827.5 Billion in 2014 to N2.33 Trillion in 2022.” The NAICOM helmsman noted that despite the upward movement in the industry’s income trajectory, the industry has been hampered by talent gap, comparatively low public awareness, insurance affordability, lack of trust and confidence in insurers, cultural and religious bias, inadequate distribution channels, low enforcement of insurance, among numerous others. Thomas said the Commission under my leadership has remained resilient and focused on implementing initiatives that will foster development of the Nigerian insurance industry and align its fortune with that of the nation as the Africa largest economy. As part of its efforts to reach its goal, the NAICOM boss said the Commission will transform the regulatory environment to sustain the industry growth, ensuring a transition to a risk-based capital model. “Promote insurance awareness and adoption; Broaden insurance product offerings and improve effectiveness of distribution channels; enhance digitalization of the insurance industry; deepen the industry’s talent pool and capabilities as well as support Nigeria’s economic transformation and sustainability agenda, he said. Highlighting some of the flagship projects being implemented by the management of the Commission as part o its medium term Strategic Plan 2021–2023, Thomas explained that the Commission has ensured improved safety and soundness of the Nigerian insurance sector to continue to de-risk economic activities of Nigerians through the enhancement of our prudential regulatory tools and good corporate governance practices; migration of the Commission’s supervisory regime to align with global best practices. According to him, this initiative has enhanced the Commission’s distress management and market restructuring. “Implementation of Project E-Regulation through operationalized Business Process Management Solution and NAICOM Portal.  The BPMS is currently being used to process applications from insurance institutions while the Portal remains the focal point for generation of unique policy identification numbers for all policies as well as repository for statistical data including verification of insurance policies issued in Nigeria,” he said.    The theme of the Conference is “Redefining Safety – Insurance Solutions for Public Buildings and Buildings under Construction”. 

MTN Nigeria secures N100bn funding to bolster operations

MTN Nigeria, a leading telecommunications provider, has successfully initiated a funding drive to raise N100 billion as part of its strategic efforts to enhance operational capabilities. This funding is being secured through the issuance of Series 6 and 7 under the company’s established commercial paper programme. The capital infusion is slated to fortify the company’s working capital reserves and serve various general corporate objectives. A statement from Afrinvest, a prominent financial advisory firm, announced the commencement of the MTN Nigeria Communications PLC Series 6 & 7 Commercial Paper offering. The offering, which commenced on August 16, 2023, is scheduled to conclude on August 21, 2023. Investors are presented with a compelling opportunity, with a yield of 10.88% for Series 6 and 11.25% for Series 7, resulting in yields of 115% and 12.25% respectively. MTN Nigeria, a telecommunications powerhouse, holds a preeminent position in Nigeria’s communications landscape, boasting a subscriber base of over 77.1 million mobile users as of H1 2023. This colossal market presence is underpinned by substantial investments in cutting-edge infrastructure, including an expansive 2G, 3G, and 4G network that covers 92.5% of 2G, 86.3% of 3G, and 80.0% of 4G population coverage. Furthermore, the company boasts an extensive fiber network spanning over 35,000 kilometers and a diverse range of valuable spectrum holdings. MTN Nigeria has consistently demonstrated its commitment to innovation by spearheading the launch of Nigeria’s first-ever 5G network. This pioneering move has resulted in 5G coverage across key cities in all six geopolitical regions, achieving a population coverage of 5.5%. The company’s influence extends to digital and financial inclusion, evidenced by a substantial user base of approximately 41 million active data users and 7 million active fintech users. This demographic engagement is particularly significant within Nigeria’s youthful and rapidly expanding population. Notably, MTN Nigeria sustains its AAA rating from GCR, the highest attainable corporate rating, underscoring its robust competitive stance, strong earnings, and reliable cash flows. The company also garners an Aa+ rating from Agusto, further validating its sound financial standing. These commendations are reflective of MTN Nigeria’s adept management team and its symbiotic association with the broader MTN Group. The capital garnered from this offering will play a pivotal role in reinforcing MTN Nigeria’s working capital provisions and fulfilling overarching corporate objectives. The transaction underscores MTN Nigeria’s ongoing commitment to sustainable growth and resilience within the telecommunications sector.