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The largest Nigerian bank listed on the London Stock Exchange

Article - July 17, 2013
Zenith Bank, Nigeria's third largest lender by market value, raised the bar last year, posting record-breaking profits
When racking up its N100 billion (£407 million) worth of profit after tax in 2012 – a 106 per cent increase from 2011 figures – Zenith Bank became the first ever in the country to pass the massive N100 billion milestone in a financial year.
 
With gross earnings also standing at N307 billion – up 26 per cent – Zenith has really set down an important marker to cement its position as a true leader in the Nigerian banking industry.
 
In accordance with the company’s tradition of generating more value for its shareholders, the bank’s directors have proposed a dividend payout of N1.60 per share, while investors and financial analysts alike have heaped praise on its remarkable performance.
 
Zenith, however, is certainly no stranger to setting itself apart from the rest. Since its inception in 1990, the bank has continually been raising the bar of the country’s financial sector, ultimately leading to its outstanding rate of growth.
 
“When we started the bank 23 years ago, the banking industry in Nigeria was still in its early stages of development,” explains Group Managing Director and CEO Godwin Emefiele. “So to differentiate ourselves, we said we would like to run a bank where people do not have a crowded banking hall. We were the first bank in Nigeria to employ graduates as customer service and cash and teller people because we felt they would take the initiative to work hard and in turn speed up processes within the banking halls.
 
“Again we were the first bank in Nigeria to introduce online real-time banking, and we were the first bank in Nigeria where when you walked into the banking hall, you had access to internet facilities. So for the last 23 years we have focused on excellent customer service and cutting-edge technology.”
 
Through such commitment to innovational development, combined with a prudent corporate governance and solid risk management, Zenith shot to profitability within its first decade of operations and has retained this prime position as an industry leader to date, continuing to grow organically and becoming an institution of choice not only in Nigeria, but around the African continent, as well as having a presence in the United Kingdom.
 
Through such commitment to innovational development, combined with a prudent corporate governance and solid risk management, Zenith shot to profitability within its first decade of operations and has retained this prime position as an industry leader to date, continuing to grow organically and becoming an institution of choice not only in Nigeria, but around the African continent, as well as having a presence in the UK.
 
With the bank’s customer base well in excess of 1.6 million accounts and growing, Zenith offers financial services to Nigeria’s major corporate entities, many of which are subsidiaries of multinational corporations and large indigenous companies that cut across all of the country’s main sectors, from oil and gas, to power, infrastructure and real estate.
 
Now, amid such a rapidly rising reputation, Zenith is looking to further add to its mounting international prestige. This year the bank listed on the London Stock Exchange (LSE), taking a major step towards improving liquidity in its stock through global depositary receipts (GDR).
 
“The listing of $850 million (£560 million) worth of shares at $6.80 each is a major step by the bank at improving liquidity in its stock through GDR. We are confident it will give us access to a wide range of major institutional investors and significantly raise its international profile,” says Mr Emefiele.

The bank, clearly in a confident mood about the potential of the listing, believes the decision will help open a lucrative path to the deepest international pool of capital in the world, with the LSE currently holding more than $1.8 trillion in international equity assets. And while the company’s expectation is that stock will begin to appreciate worldwide, given the increased confidence of prospective investors, this will inevitably begin to result in higher dividends for shareholders.
 
Indeed the move, which was given full approval by shareholders at the end of 2012, is a sure sign of the public limited company’s strong stability and its astonishing journey from local bank to global brand.
 
Having won a World Finance award at the LSE last year for Best Corporate Governance, it is clear to see that Zenith Bank’s global goal is not just purely aspirational, but their star is truly beginning to rise in international finance circles thanks to a history of shrewd management and a commitment to creativity and transparency.
 
Under the leadership of Mr Emefiele – who has sat on the bank’s executive team since its incorporation – Zenith has also recently been honoured by such respected institutions as Capital Finance International (Best Commercial Bank in Africa) and FTSE Global Markets, who named it an Emerging Global Super Brand. 
 
In light of this remarkable success story, going forward, Mr Emefiele believes that having set the standard for the Nigerian banking industry over the last two decades, his company once again stands apart from the rest as the ideal business partner for foreign companies looking to invest in the country.
 
“I think Zenith Bank is a natural choice because it is a bank with strong liquidity, strong capital adequacy, it is run on the best corporate governance structure and because we take risk management very seriously. And ultimately if you look at our track records and return on investment, Zenith is among the most stable and best investments in Nigeria.”

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