GTBank, Zenith Bank to pay shareholders N123.8bn in 2017

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Zenith Bank

…report N403.7bn PBT

By Kayode Tokede

Leading Tier-I banks in profits, Zenith Bank Plc and Guaranty Trust Bank Plc (GTBank) are to pay their shareholders N123.8 billion dividend in 2017 over improved profit before tax.

The N123.8 billion proposed dividend in 2017 is 13.9 per cent or N15.15 billion higher than N108.6 billion paid to shareholders.

Both banks in the last five years have maintained increased dividend payout to shareholders despite macro economic challenges in the global and domestic economy.

Headline inflation continued its down ward trend declining to 15.4 per cent 2017 from a high of18.7 per cent in Jan.2017 as a result of base effects and improved foreign exchange liquidity.

Exchange rate stayed relatively stable in 2017 as a result of improved foreign exchange liquidity in the market following the introduction of the investors’ and exporters’ window in April 2017.

Notably, Zenith Bank in half year results of 2015 recommended an interim dividend of 25 kobo per share, the first in the history of the bank.

The breakdown by our correspondent revealed that Zenith Bank’s Total dividend payout in 2016 moved to N63.4 billion as against N56.5 billion while GTBank proposed a total dividend of about N60.3 billion in 2017 from N52.09 billion in 2016.

Zenith Bank proposed a dividend of N55.57 billion (N2.45 kobo per share) as against N48.66 billion (N1.77 kobo per share) in 2016 and interim dividend paid in 2017 and 2016 was at N7.85 billion respectively.

The board of directors of GTBank proposed a final dividend of N51.5 billion (N2.40 kobo per share) but declared Interim dividend of N8.8 billion (N0.30 kobo per share) that was paid last year.

For the year ended December 2016, the GTBank management proposed a total dividend per share (DPS) of N2.00, comprising of N0.25 interim dividend already paid and final dividend of N1.75.

GTBank in a statement said, “The Bank is proposing a final dividend of 240k per unit of ordinary share held by shareholders in addition to interim dividend of N0.30k per unit of ordinary share bringing total dividend for 2017 financial year to N2.70 per unit of ordinary share.”

Both banks reported N403.7 billion profit before tax from N321.9 billion in 2016, representing an increase of N81.8 billion or 25.4 per cent.

According to our correspondent check, GTBank reported 21.3 per cent growth in profit before tax from N165.1 billion in 2016 to N200.2billion in 2017 while Zenith Bank reported 29.8 per cent increase of profit before tax to N203.46 billion as against N156.7 billion reported in 2016.

On the backdrop of improved profitability, GTBank’s Return on Equity (ROAE) and Return on Assets (ROAA) closed at 35.4 per cent and 6.2per cent in respectively.

Zenith Bank reported 23.3 per cent RoAE in 2017 from 20 per cent in 2016 while RoAA increased to 3.4 per cent from three per cent in 2016.

Commenting on the financial results, the Managing Director/CEO of Guaranty Trust Bank plc, Mr. Segun Agbaje said, “2017 was a pivotal year for the bank.

“We delivered a strong result in a challenging environment; achieving record growth in earnings, carefully managing cost margins and leveraging our digital-first customer-centric strategy to deliver world-class services that are simple, cheap and easily accessible.”

Zenith Bank Group in a statement stated that, “Despite the challenging competitive operating environment, management’s outlook continues to be positive. Furthermore, the Group is strategically positioned to explore opportunities to grow its customer base and risk assets in strategic sectors.”

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