Onyeagwu sings Ebenezer on Zenith Bank CEO’s seat
June 06 (THEWILL) – It has been three years since Mr Ebenezer Onyeagwu was appointed Managing Director/Chief Executive Officer of Zenith Bank Plc. On that day, June 1, 2019, his name, Ebenezar, resonated philosophically and literally in the world of finance. It was news from local and international media that recognize Zenith Bank as one that operates at the zenith of the industry.
Regardless of where his religious leanings go, it was obvious that running Zenith Bank, Nigeria’s largest commercial bank by market size, requires enormous divine help. It is therefore natural to perceive that he must have, in his closet, activated the original meaning of his name, Ebenezar, the Hebrew word for God is my Help Stone – chanting “God in my Ebenezer”.
In an industry where the dominant lexicon is Money, inserting punctuation marks where they are not needed could be a major mistake capable of frustrating the hope of the expert. It is therefore a herculean task at the head of the corporate management of Zenith Bank: to maintain the growing number. This is more important for a financial services institution listed on the prestigious Premium Board of the Nigerian Exchange (NGX). Onyeagwu knows he must be unyielding in his adherence to the culture of excellence with which Zenith Bank has carved out a place for itself, to deliver. And he did, in the 1,095 days he held the CEO seat of Zenith Bank.
Defy headwinds
The starting point is the bank’s 2021 annual report – three years after Onyeagwu’s appointment.
Zenith Bank Plc has defied a difficult macroeconomic environment that has seen the worst recession in a quarter century and exacerbated by the coronavirus (COVID-19) pandemic, to grow its assets by 60% in five years. A review of the bank’s performance between 2017 and 2021, as it emerged from the economic uncertainties of the 2016 recession and the worsening effects of the COVID-19 pandemic, revealed a culture of resilience that confirms its leadership on the market.
This unusual posture has resulted in significant asset growth which has reached almost one trillion naira in 2021, supported by continued impressive performance in virtually all key lender balance sheet metrics over the period. Analysts note that the performance did not reflect the general slowdown in the economy when inflation, GDP growth and unemployment rates hit their worst. They attribute this to the bank’s ability to carve out a niche in the financial services industry.
A snapshot of the results showed that Zenith Bank’s asset base grew by 6.5% from 5.59 trillion naira in 2017 to 5.95 trillion naira in 2018. Obviously, this reflects the environment post-recession recovery which also impacted total loans and advances, which recorded a decline of 13.4% – from 2.10 trillion naira to 1.83 trillion naira in 2017 and 2018 respectively. Significantly, gross lending reached N3.51 trillion over the five-year period, up 67.15% from N2.10 trillion in 2017.
Credit expansion in an economy that has been described as surviving on life support is a measure of a bank’s confidence to achieve organic growth devoid of the “soft” earnings common to seasonal investments.
Zenith Bank reports showed a steady growth in gross loans to N2.30 trillion in 2019 from N1.82 trillion in 2018 or 26.38%. Apparently, in a bid to help the economy out of the COVID-19 pandemic, the bank increased its gross lending to 2.91 trillion naira in 2020, reflecting a 26.5% increase from 2.30 trillion naira registered in the previous year. Gross loans reached N3.51 trillion in 2021.
Net interest income, which derives largely from banks’ core lending activity, increased steadily to N295.6 billion in 2018 from N258 billion; then 267 billion naira in 2019 and 299.7 billion naira in 2020 when the COVID-19 pandemic ravaged the economy and created serious health problems. Net interest income of N320.8 billion recorded in 2021 represented a significant growth of 24.35% over the reporting period.
Due to the targeted drive to increase retail deposits over the past three years, bank customer deposits jumped 51.8% between 2019 and 2021, reaching an all-time high of N6.47 trillion. in 2021 compared to 4.26 trillion naira in 2019.
Customer deposit is a measure of depositor confidence in a bank. Zenith Bank was once criticized for its elitist stance that excluded the less privileged. But all that has changed because the rich, the poor, and the neither rich nor poor now frequent the bank – which is a good testament to the organization. Zenith Bank recorded an increase in customer deposits of 88.63% between 2017 and 2021.
The increase in gross revenue which reached N765.55 billion in 2021 from N696.45 billion the previous year, reflecting a 10% increase, supports the emergence of its strong asset base. Again, the pandemic year of 2020 did not see a decline in gross revenue. Instead, it was an increase of 5.17% from 662.25 billion naira in 2019. The figure for 2018 was 630.34 billion naira, 5% below the record high. 2019. Overall, the bank’s gross profit increased by 2.74%.
There is a steady increase in the profit of the bank over the five-year period. Profit before tax (PBT) increased to N280.37 in 2021 from N199.31 in 2017, a jump of 40.68%. Profit After Tax (PAT) also reflected an upward trajectory reaching N244.6 billion in 2021 from N173.79 in 2017, an improvement of 40.8%. Similar to the bank’s performance trend, PAT’s performance in 2020 was not slowed by COVID-19. It rose to 230.56 billion naira from 208.84 billion naira in 2019, or 10.4%. Earnings per share increased steadily from 5.53 in 2017 to 7.78 in 2021, or 40.6%.
During the conference call held on March 3, 2022 to present the results of the financial year 2021 (FYE), Group Managing Director/CEO Mr. Ebenezer Onyeagwu said that Zenith Bank exceeded market expectations with a double-digit gross profit growth and an impressive bottom line. performance in other settings. He added that the growth was achieved amid growing macroeconomic instability which has allowed the bank to maintain strong earnings growth and improved liquidity.
For more than three decades, Zenith Bank has distinguished itself in the Nigerian financial services industry through superior service offerings, unique customer experience and strong economic indices. Under Onyeagwu, the Bank remains an undisputed leader in the digital space with several firsts in the deployment of innovative products, solutions and an assortment of alternative channels that ensure transaction convenience, speed and security.
Let the Ebenezer song continue, with ‘Congratulations’ on the descending pitch.