BREAKING; Zenith Bank H1 2026 pre-tax profit rises 1.9% to N637.6 billion

Zenith Bank Plc reported a profit before tax of N637.6 billion for the half-year ended June 30, 2026, a 1.9% increase from N625.6 billion in the same period of 2025.

This is according to the bank’s audited financial statements for the period, released on the Nigerian Exchange Limited (NGX).

The modest growth came as a sharp drop in impairment charges offset a swing from foreign exchange trading gains to losses. However, a higher tax bill meant profit after tax fell 19.1% to N430.8 billion.

Standalone second-quarter pre-tax profit stood at N276.68 billion, down 23.34% from N360.92 billion in the preceding quarter but up 0.68% from N274.81 billion in Q2 2025.

The Board has proposed an interim dividend of N1.50 per share, up from N1.25 last year.

Key highlights (H1 2026 vs H1 2025)

• Gross earnings: N1.9 trillion, −24.6% YoY
• Net interest income: N1.25 trillion, −7.4% YoY
• Net fee and commission income: N178.8 billion, +39.6% YoY
• Impairment charge: N141.1 billion, −81.5% YoY
• Trading loss: N92.2 billion, vs a N467.8 billion gain
• Profit before tax: N637.6 billion, +1.9% YoY
• Profit after tax: N430.8 billion, −19.1% YoY
• Earnings per share: N10.48 -19.07% YoY
• Total assets: N32.65 trillion, +3.8% YTD
• Customer deposits: N26.35 trillion, +8.3% YTD

Impairments down, FX gains gone

• Zenith’s pre-tax profit held steady because two large swings almost cancelled each other out.
• The impairment charge, money set aside for loans that may not be repaid, fell to N141.1 billion from N762.1 billion. Last year, the bank took heavy provisions to clean up its loan book.
• Meanwhile, FX trading turned from a major profit source into a loss.
• Zenith booked a N284.9 billion realised loss on currency trading, against a N268.5 billion gain in H1 2025, as a more stable naira reversed the gains banks made while it was weakening.

Lending income under pressure

• Net interest income fell 7.4% to N1.25 trillion. Interest income from loans was flat at N945.8 billion even though gross loans grew 13.6%, a sign of falling lending yields.
• Income from treasury bills dropped 22.3% to N406.2 billion.
• Deposits also became more expensive, with interest paid to customers rising 10.7% to N387.3 billion. Total interest expense fell only because the bank repaid most of its borrowings.

Fees are the bright spot

• Net fee and commission income rose 39.6% to N178.8 billion.
• Fees on electronic products rose 41.5% to N51.5 billion, and account maintenance fees rose 22.1% to N52.8 billion.
• Other income also rose to N71.6 billion, helped by N29.7 billion recovered from written-off loans.

Pan Africa

• Nigeria generated N1.55 trillion in segment revenue, representing 81.17% of total segment revenue before consolidation adjustments.
• Other African operations contributed N244.55 billion, or 12.81%, while Europe contributed N115.02 billion, or 6.02%.

Costs rising faster than income

• Total operating costs rose 9% to N633.8 billion, while income before impairments fell 28.2%.
• The cost-to-income ratio jumped to 44.9% from 29.5%, meaning Zenith now spends about 45 kobo to earn every N1 of income.
• IT spending rose 52.2% to N75.9 billion, and fuel and maintenance rose 27.5% to N57 billion.
• The AMCON levy was flat at N143.2 billion, still about a third of operating expenses.

Tax takes a bigger bite

• Income tax expense more than doubled to N206.8 billion, pushing the effective tax rate to 32.4% from 14.9%.
• This includes a N89.9 billion charge for tax under-provided in previous periods.
• Without it, profit after tax would have been about N520.6 billion, roughly 2% below H1 2025.

Balance sheet and cash flow

• Net loans rose 15.3% to N12.05 trillion, faster than deposits, which grew 8.3% to N26.35 trillion.
• Borrowings fell to N11.1 billion from N651.2 billion, leaving deposits to fund almost the entire bank.
• Operations used N1.55 trillion of cash, compared with N1.83 trillion generated a year earlier, as the bank channelled money into loans and treasury bills held for trading.
• Capital expenditure more than doubled to N109.6 billion, and the branch network grew to 472 from 456.
• Shareholders’ funds slipped 0.8% to N4.89 trillion after the N359.4 billion final dividend for 2025 and a N92.8 billion currency translation loss.
• The capital adequacy ratio stood at 25.1%..

Market reaction

Zenith Bank’s shares closed at N134.70 on Friday, down 1.32%, as the broader banking index came under pressure.

• The results were released after the market closed, so Friday’s decline cannot be attributed to a trading reaction to the announcement.
• The board proposed an interim dividend of ₦1.50 per share, compared with N1.25 for the corresponding 2025 period.
• The proposed distribution totals N61.60 billion and will be presented for shareholder ratification at the next annual general meeting.
• Payment is subject to 10% withholding tax for qualified recipients.

With the FX windfall gone, Zenith’s next leg of earnings growth will have to come from lending, fees, and tighter cost control.