Zenith Bank Plc has published its financial results for the half year ended June 30, 2025. The report shows a pre-tax profit of N625.63 billion, representing a 13.95 percent year-on-year decline compared to N726.96 billion reported in the same period of 2024. Post-tax profit also fell by 7.93 percent to N532.18 billion.
Despite this dip in profitability, the bank’s Board of Directors approved an interim dividend of N1.25 per share, an increase of 25 percent compared to N1.00 declared in the first half of 2024. This upward adjustment in shareholder payout is a strong statement of confidence by management in Zenith Bank’s capital position and cash flow resilience.
Key highlights of Zenith Bank’s performance
The decline in profits underscores the pressure facing the banking sector in Nigeria amid a difficult macroeconomic environment. In the first quarter of 2025, Zenith Bank posted solid growth in gross earnings, which rose by about 22 percent year-on-year. Interest income surged by more than 70 percent, reflecting higher yields on loans and investments. However, this was offset by a sharp 67 percent decline in non-interest income, particularly from trading activities and foreign exchange gains.
The bank’s half-year earnings therefore reflect not only operational challenges but also the absence of extraordinary gains that had significantly boosted H1 2024 results. Last year’s performance benefited from exceptional trading income, making the current decline more pronounced in comparison.
Operating expenses and impairment charges also contributed to the decline. Rising inflation and higher operating costs in Nigeria have pressured banks to spend more on staff, technology, and compliance. In addition, provisioning for loan losses has remained high, reflecting both conservative risk management and an uncertain economic climate.
Resilience and shareholder focus
Despite these headwinds, Zenith Bank’s fundamentals remain strong. The bank has maintained robust capital adequacy, with ratios comfortably above regulatory requirements, and liquidity levels remain sound at about 60 percent as earlier disclosed. Strong deposit growth continues to provide a stable and low-cost funding base, which has helped shield the bank from some of the pressures of rising interest rates.
The decision to increase the interim dividend to N1.25 per share in a period of lower profits illustrates management’s confidence in the bank’s long-term stability. It also signals a commitment to rewarding shareholders despite temporary earnings volatility.
Risks and challenges ahead
While Zenith Bank remains profitable and resilient, several risks continue to loom over its financial outlook. The heavy reliance on non-interest income, particularly trading and foreign exchange gains, has introduced significant earnings volatility. With weaker trading income in the first half of 2025, profit growth has been constrained.
The bank also faces risks from rising impairments as borrowers struggle with high inflation, foreign exchange instability, and elevated interest rates. The cost-to-income ratio is expected to remain under pressure as operating expenses climb.
The broader Nigerian banking sector is also undergoing shifts, with regulatory changes around recapitalization and monetary policy adding complexity. For instance, persistent currency depreciation could impact loan books and asset valuations, while inflation continues to erode margins and household spending power.
Outlook for the rest of 2025
Looking ahead, Zenith Bank’s ability to sustain profit growth will depend on expanding core interest income while keeping a firm grip on costs and asset quality. Management will need to balance aggressive lending opportunities with prudent risk management, especially in light of ongoing macroeconomic volatility.
Analysts expect the second half of 2025 to remain challenging, but Zenith’s large capital buffers, strong market position, and diversified operations give it an edge. The increased dividend payout reflects confidence, but it also raises questions about sustainability if profits continue to trend lower.
Zenith Bank’s half-year 2025 results highlight both its enduring strengths and the obstacles it must navigate. With N626 billion in pre-tax profit and N532 billion in post-tax profit, the bank remains highly profitable despite year-on-year declines. The increase in dividends offers reassurance to investors, but the underlying pressures of higher costs, impairments, and volatile trading income cannot be ignored.
The remainder of 2025 will be critical in determining whether Zenith Bank can stabilize its earnings trajectory and maintain its reputation as one of Nigeria’s most reliable and profitable financial institutions.
