…as Fees Surge 40%
Zenith Bank Plc raised Half-Year (H1) pretax profit and lifted its interim dividend by 20% as wider margins, cheaper deposits, a 40% jump in fees and a sharp fall in bad-loan charges outweighed lower interest rates, a stronger naira and a heavier tax bill.
Profit before tax rose 2% to ₦637 billion in the six months to June, from ₦625.6 billion a year earlier. The board proposed an interim dividend of ₦1.50 a share, up from ₦1.25.
Profit after tax fell 19% to ₦430.7 billion. That was entirely due to tax: the charge more than doubled to ₦206 billion after the Nigeria Tax Act 2025 took effect. MoneyCentral calculates that Zenith’s effective tax rate rose to 32.3% from 14.9%. At the old rate, net profit would have been about ₦542 billion, slightly up on last year.
Zenith Bank cut funding costs faster than its interest income fell. Interest expense dropped 13% and the cost of funds fell to 3.3% from 4.0%, widening the net interest margin to 12.4% from 11.9%. Net fee and commission income rose 40% to ₦178.77 billion on higher digital transaction volumes.
Cost of risk fell to 2.2% from 14.3% because last year’s clean-up of forbearance loans did not recur. Gross loans grew 14% to ₦12.57 trillion from December, while the non-performing loan ratio improved to 3.78%. Customer deposits rose 8% to ₦26.35 trillion.
At a closing of its shares at ₦134.10, Zenith trades at about 6.4 times annualised earnings, on MoneyCentral estimates. The interim dividend takes only 14% of first-half profit, leaving room for a larger final payout.
The main weak spot was trading income, which fell on revaluation losses (₦284.90 billion realised loss on foreign currency trading gains) as the naira strengthened.
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