Zenith Bank Plc · NSENG:ZENITHBANK
Zenith Bank — H1 2012 Earnings Presentation
32 slides from Zenith Bank's earnings presentation, Jul 27, 2012
Slide 1: H1 2012 Results Presentation to Investors & Analysts
H1 2012 Results Presentation to Investors & Analysts Click to edit Master title style IFRS Compliant Results Click to edit Master subtitle style people | technology | service
Slide 2: Disclaimer
Disclaimer This presentation is based on the consolidated financial statements of Zenith Bank Plc, a company incorporated in Nigeria on 30 May 1990, and its subsidiaries (hereinafter collectively referred to as "the Group"). The financial statements are prepared in accordance with the International
Slide 3: Speakers
Speakers Godwin Emefiele – Managing Director/Chief Executive Officer Udom Emmanuel – Executive Director/Chief Financial Officer PeterAmangbo – Executive Director – Corporate Banking Andy Ojei–Executive Director-Enterprise and Risk Management 3
Slide 4: Agenda
Agenda Operating Environment Results P&L Group Balance By Segment Sheet By Geography Key Ratios Company Risk Management Strategy and Outlook Operational Highlights Q&A 4
Slide 5: The Nigerian Economy
The Nigerian Economy … GDP Growth: The Nigerian economy grew by 6.17% in Key Foreign Reserves: Nigeria’s external reserve stood at $36.72bn Q1’2012 compared to 7.13% recorded in Q1’2011. Decrease in as at the end of Q2 2012, , a slight decline from this year’s peak of Theme economic activities cause
Slide 6: Our Investment Proposition
Our Investment Proposition Key Strong earnings capacity, Solid capital adequacy, High liquidity, Declining NPLs, Theme Excellent technology and Well-motivated staff A dominant player in Corporate Banking. The Bank controls a significant share of the corporate clients in strategic sectors of the Ni
Slide 7: Agenda
Agenda Operating Environment Results P&L Group By Segment By Geography Key Ratios Company Risk Management Strategy and Outlook Operational Highlights Q&A 7
Slide 8: Financial Highlights
Financial Highlights Increased Efficiency Through Optimal Resource Allocation Key Building A Shock-Proof Balance Sheet Theme Gross Earnings: N151.10bn +22.66% YoY Net Interest Income: N79.75bn +26.66% YoY P&L Net Interest Margin: 8.72% (Annualized) +15.96% YoY P&L PBT: N50.16bn +36.33% YoY PAT: N42.
Slide 9: Profit & Loss Statement
Profit & Loss Statement Group Group (N’m) 6 mths to 6 mths to YOY Jun-12 Jun-11 Change Gross Income 151,103 123,197 22.65% Interest Income 110,881 79,705 39.11% Interest Expense 31,132 16,741 85.96% Net Interest Income 79,749 62,964 26.66% Impairment Charge for Credit Losses -1,753 -4,070 -56.93% Ne
Slide 10: Robust earnings and profitability
Robust earnings and profitability... Net Interest Margin Comments Net Interest Margin: Consistent increase over the last 3 quarters. The Group maintained a strong Net Interest Margin through an efficient balance sheet management. Maintained a reduced Operating Cost to Income Ratio of 40.96 % fro
Slide 11: Revenue Base ...Sustained Diversification
Revenue Base …Sustained Diversification H1 2012 H1 2011 Interest Income PBT N'm H1 2012 H1 2011 YoY Placements 1,771 6,763 -73.81% T-Bills & Inv. Securities 37,959 15,988 137.42% Government Bonds 14,619 7,448 96.28% Loans & Advances 55,890 48,941 14.20% Advances Under Finance Lease 641 565 13.47% H1
Slide 12: Continuous efforts in cost-reduction strategies
Continuous efforts in cost-reduction strategies ….. H1 2011 H1 2012 Interest Expenses N'm H1 2012 H1 2011 YoY Current accounts 2,032 1,008 101.63% Savings accounts 717 619 15.86% Time deposits 27,813 14,594 90.58% Inter-bank takings 193 85 126.93% Borrowed funds 376 435 -13.46% H1 2012 Operating Exp
Slide 13: Balance Sheet - Assets
Balance Sheet- Assets Group Group Group (N'm) Jun-12 Dec-11 YTD Jun-11 Cash and balances with central banks 180,852 223,187 -18.97% 127,018 Treasury bills 460,260 510,738 -9.88% 359,387 Due from other banks 420,475 234,521 79.29% 346,506 Loans and advances 972,242 893,833 8.77% 845,360 Reinsurance a
Slide 14: Balance Sheet - Liabilities & Equity
Balance Sheet- Liabilities & Equity Group Group Group (N'm) Jun-12 Dec-11 YTD Jun-11 Customers deposits 1,701,005 1,655,458 2.75% 1,446,662 Claims payable - - - 218 Current income tax 12,781 13,348 -4.25% 5,829 Deferred income tax liabilities 8,957 10,742 -16.62% 10,553 Other liabilities 265,592 152
Slide 15: Sustained assets & liabilities match
Sustained assets & liabilities match.. Loans Growth Loans & Advances H1 2012 Customer Deposits Deposits Mix H1 2012 15
Slide 16: Liquid asset base and funding mix
Continued market dominance through strong liquid asset base and funding mix… H1 2012 Liquid Assets H1 2011 H1 2012 H1 2011 Funding Mix 16
Slide 17: Agenda
Agenda Operating Environment Results P&L Group Balance By Segment Sheet By Geography Key Ratios Company Risk Management Strategy and Outlook Operational Highlights Q&A 17
Slide 18: P&L – By Segment
P&L – By Segment Discontinued 6 Months Ended June 2012 (N’m) Pension Treasury Corporate Retail Consolidated Operations Total Revenue 1,460 30,828 95,048 15,781 7,986 151,103 Total Expenses -244 -21,756 -63,439 -9,285 -6,217 -100,940 Profit Before Tax 1,216 9,072 31,610 6,496 1,769 50,163 Tax -188 -1
Slide 19: P&L – By Segment
P&L – By Segment Gross Revenue by Segment – Jun ‘12 Gross Revenue by Segment – Jun ‘11 Corporate Corporate 65.10% 62.90% Treasury 20.40% Treasury 16.48% Pension Pension 0.97% 0.81% Discontinued Operations Discontinued Operations Retail 5.29% Retail 10.97% 6.64% 10.44% Corporate Banking & Retail bank
Slide 20: Agenda
Agenda Operating Environment Results P&L Group Balance By Segment Sheet By Geography Key Ratios Company Risk Management Strategy and Outlook Operational Highlights Q&A 20
Slide 21: P&L – By Geography
P&L – By Geography 6 Months Ended June 2012 (N’m) Nigeria Rest of Africa Europe Eliminations Consolidated Total Revenue 144,441 6,192 2,612 2,142 155,387 Total Expense -96,817 -4,345 -1920 -2,142 -105224 Profit Before Tax 47,624 1,847 692 - 50,163 Tax -7,309 -299 -144 - -7752 Profit After Tax 40,315
Slide 22: P&L – By Geography
P&L – By Geography Gross Revenue by Geography – Jun ‘12 Gross Revenue by Geography – Jun ‘11 Our Nigerian business continues to be the main driver of profitability … Our Nigerian business continues providingto be 93%the of main driver gross of profitability … providing revenue 94.25% of gross revenu
Slide 23: Agenda
Agenda Operating Environment Results P&L Group Balance By Segment Sheet By Geography Key Ratios Company Risk Management Strategy and Outlook Operational Highlights Q&A 23
Slide 24: Healthy Risk Assets Portfolio
Healthy Risk Assets Portfolio… NPL Coverage Ratio Our Risk Management Strategy The Group considers sound risk management to be the foundation of long lasting financial institution. It continues to adopt a holistic and integrated approach to risk management hence, brings all risks together under
Slide 25: Focused risk management via portfolio diversification
Focused risk management via portfolio diversification Loans by Sector – June 2012 No concentration risk 25
Slide 26: Strong Capitalization and Liquidity
Strong Capitalization and Liquidity Liquidity and Capital Adequacy Capital and liquidity ratios for the Bank – well above industry requirements. Capital Mix Capital base – predominantly made up of Tier 1 capital. The increase inTier II capital was fueled by the general provisioning. 26
Slide 27: Agenda
Agenda Operating Environment Results P&L Group By Segment By Geography Key Ratios Company Risk Management Strategy and Outlook Operational Highlights Q&A 27
Slide 28: Strategies for driving our vision
Strategies for driving our vision 1 The Bank focuses on cost 2 The Bank accomplishes this effective deposits from the strategy by: Compete retail end of the market to lend Consistent focus and aggressively for to the corporate end with Delivering superior investment in attracting and market sh
Slide 29: Our Key Growth Target Sectors
Our Key Growth Target Sectors Driving profitability with our competitive advantages Sector Identified Growth Competitive Advantage Sectors Business line & Geography Infrastructure Strong capital and liquidity Manufacturing Strong brand Oil and Gas (Upstream & Strong international rating Downst
Slide 30: Outlook and Prospects for FY2012
Outlook and Prospects for FY2012 Mobile Banking: In a bid to encourage and promote person- Agriculture: The Federal government’s resolve to boost the agricultural sector in the country would no doubt create quite to-person payments and leverage on mobile phone channels as a a number of opportuni
Slide 31: Outlook and Prospects for FY2012
Outlook and Prospects for FY2012 Representative Office: We remain optimistic of the Deposit Base: Our drive for low cost and appropriately business opportunities inherent in the Peoples Republic of mixed deposit base to fund our credit and money market China hence, our resolve to officially open
Slide 32: Thank you
Q&A Thank you 32