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UPDATE 1-Nigeria's Zenith Bank looks to liquidity to lift 2020 profit

Published 09/09/2020, 15:25
Updated 09/09/2020, 15:30

(Adds quote, details)
By Chijioke Ohuocha
ABUJA, Sept 9 (Reuters) - Nigeria's Zenith Bank ZENITHB.LG
expects pretax profit to rise 4% to 253 billion naira ($665
million) this year, despite the impact of the coronavirus,
saying on Wednesday that strong liquidity buffers had helped it
to grow.
Zenith, one of Nigeria's biggest banks, said it had made a
profit of 114.1 billion naira in the first six months of the
year, up 2.2% from a year before. Meanwhile, its liquidity ratio
stood at 50.8% during the period, well above a 30% regulatory
minimum.
Nigeria's growth contracted in the second quarter with fears
that the west African country's economy could be heading into a
recession in the next quarter. "We have seen a lot of volatility within this period,"
Zenith's chief executive Ebenezer Onyeagwu said during an
analyst call after the results were released.
Zenith, which said it was targeting the growth sectors of
agriculture, healthcare, infrastructure and small businesses,
expects loan growth to fall to 10% by the end of the year, from
22.1% achieved a year earlier. It said its loan growth was 13.7%
for the first six months, supported by a naira devaluation.
Most of Zenith's rival banks have reported a drop in profit,
citing disruptions associated with the coronavirus pandemic.
Zenith said its interest income grew 10.5% against a
marginal rise in its cost-to-income ratio, while its assets were
largely funded by deposits and its core capital of 94% of total
capital provided scope for further growth.
($1 = 380.70 naira)

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