Banking
Zenith Bank’s Earnings Will Remain Broadly Stable, Upgrade Remote—S&P
By Modupe Gbadeyanka
S&P Global Ratings has disclosed that Zenith Bank will continue to display better asset quality indicators than its domestic peers and sound revenue generation over the next 12-18 months despite the generally slow economic recovery in Nigeria.
The rating agency made this observation while affirming its ‘B’ long-term and ‘B’ short-term issuer credit ratings on the Nigeria-based lender with stable outlook. It also affirmed its national scale ratings on the bank at ‘ngA/ngA-1’.
According to S&P, as of June 30, 2018, Zenith Bank had total assets of N5.3 trillion (approximately $15.3 billion), making it the second-largest bank in Nigeria, pointing out that the financial institution has a strong corporate franchise in the country and has displayed both healthy revenue generation and earnings stability, despite the challenging operating conditions in Nigeria over the past couple of years.
“We assess Zenith’s capital and earnings as moderate. The bank’s S&P Global Ratings’ risk-adjusted capital (RAC) ratio before adjustments reached 5.4 percent at end-2017, compared with 5.1 percent a year earlier.
“We expect this ratio will be 5.2 percent to 5.5 percent over the next 12-18 months. We factor into our RAC calculation our expectations that loan growth will be 3 percent in 2018 and 10 percent in 2019, and that interest margins will show a slight increase (balancing our expectation of a reduction in expensive fixed deposits and redemption of its $500 million Eurobond in April 2019).
“We also consider Zenith Bank’s good fees and commission generation, and its dividend payout ratio of about 50 percent,” the rating company said in the statement released last Thursday.
According to the statement, Zenith Bank’s asset quality metrics improved somewhat in the first half of 2018, with credit costs declining to 0.9 percent and coverage by loan loss reserves increasing to 229 percent (following the implementation of International Financial Reporting Standards (IFRS) 9 and including Stage 1 and Stage 2 provisions).
This compares with credit costs of 4.3 percent and a coverage ratio of 143 percent at year-end 2017. In the six months to June 30, 2018, nonperforming loans (NPLs) declined in absolute terms, but increased in relative terms.
It accounted for 4.9 percent of the loan book, compared with 4.7 percent at year-end 2017. Although restructured exposures increased to around 12.6 percent of total loans at mid-2018, compared with 11.8 percent a year earlier, S&P expects asset quality indicators to remain broadly stable, because it does not anticipate material migrations of these exposures to NPLs.
“We therefore believe that the bank’s cost of risk will stabilize at around 1.2 percent in the next 12-18 months,” it said.
The firm pointed out that Zenith Bank is mainly deposit-funded, which has resulted in a stable funding base.
It recorded a stable funding ratio of 151.4 percent on the back of a healthy proportion of deposit funding at mid-2018. Broad liquid assets covered 1.9x of total wholesale funding and net broad liquid assets accounted for 64.2 percent of short-term customer deposits at the same date. “However, given the short-dated nature of the bank’s deposit profile, which is a feature it shares with its domestic peers, Zenith Bank’s deposit base is confidence-sensitive.
“The stable outlook on Zenith reflects that on Nigeria, and our expectation that the bank’s earnings and asset quality metrics will remain broadly stable over the next 12-18 months.
“We would lower the ratings on the bank if we lowered the ratings on Nigeria, or if we see a material deterioration in the bank’s asset quality indicators.
“An upgrade appears remote in the next 12 months, because it would hinge on an upgrade of Nigeria or a material strengthening of the bank’s capitalization, all other factors remaining equal,” the statement said.
By Modupe Gbadeyanka
About N2 billion is expected to be used to finance renewable energy products for customers by the end of 2026 in an effort to accelerate Nigeria’s clean energy transition.
To meet this goal, Sterling Bank is launching Sterling Solar Financing Hubs inside StarTimes retail outlets to embed on-the-spot solar financing at the point of purchase.
From the N2 billion earmarked for this initiative, N600 million has already been used up.
Under this programme, customers can now walk into participating outlets, select their preferred solar solution, receive financial guidance from dedicated Sterling Solar Financing Advisors, and begin the financing process immediately, subject to the bank’s credit assessment.
The first phase of the rollout commenced this July with five Solar Financing Hubs across Lagos, located in Lekki, Ikeja, Festac, Surulere, and Victoria Island.
The network will expand rapidly to 46 StarTimes outlets nationwide before the end of the third quarter of 2026, with a view to extending the model to more than 200 StarTimes locations nationwide.
Both parties have promised to continue working together to democratise access to clean energy financing, empowering more Nigerians to solarise their homes and businesses while contributing to a greener future.
“Sterling exists to enrich lives, and we believe that access to clean, reliable energy should be within everyone’s reach. Through this partnership with StarTimes, we are democratising access to solar by bringing financing directly to the point of need, enabling more families and businesses to transition to sustainable energy without the burden of prohibitive upfront costs. This is about unlocking opportunity, improving livelihoods, and powering Nigeria’s future,” the Divisional Head of Renewable Energy and Mobility at Sterling Bank, Mr Darlington Nwankwo, said.
Also commenting, the Vice President of StarTimes Nigeria, Mr Eric Xiao, said, “With the rollout of the Sterling Solar Financing Hubs, we are doing more than just selling solar products; we are building a sustainable energy ecosystem. By integrating StarTimes’ extensive service network with Sterling Bank’s professional financial services, we are significantly lowering the barrier for Nigerian households and small businesses to access clean energy.
“Moving forward, we will continue to deepen this partnership, ensuring that more Nigerians can enjoy reliable, affordable, and smart energy solutions, ultimately turning our vision of energy accessibility into a reality for all.”
By Modupe Gbadeyanka
The Nigeria Business Summit Regional Tour of Stanbic IBTC Bank made a detour to Jogor Centre, Ibadan, Oyo State, on Wednesday, July 15, 2026, to empower Micro, Small, and Medium Enterprises (MSMEs).
The event brought together business leaders, development partners and government representatives to discuss pathways for sustainable enterprise development across the South-West.
Participants engaged in practical masterclasses on export opportunities; access to finance and business growth strategies; gaining actionable insights into market expansion; trade documentation; credit readiness; financial record-keeping; and structured financing solutions designed to support long-term business success.
The Head of Enterprise Banking at Stanbic IBTC Bank, Ms Olajumoke Bello, informed participants that the programme is part of the lender’s commitments to supporting MSMEs through practical business education, strategic partnerships and improved access to growth opportunities.
The Executive Director of Business and Commercial Banking at Stanbic IBTC Bank, Mr Remy Osuagwu, on his part, said, “Our ambition is to be more than a financial institution to Nigerian businesses. We want to be a trusted growth partner, providing the financing, business insights and advisory support entrepreneurs need to build sustainable enterprises and unlock new opportunities.”
Similarly, the chief executive of Stanbic IBTC Bank, Mr Wole Adeniyi, who reinforced the company’s commitment to enterprise development, highlighted the importance of providing businesses with the right support structures to enable sustainable growth and long-term competitiveness.
“At Stanbic IBTC, we believe that sustainable economic growth depends on the success of small and growing businesses. That is why we are focused on providing access to finance, practical advisory support and the connections businesses need to move from ambition to scale,” he stated.
The Oyo State Commissioner for Investment, Trade, Cooperatives, and Industry, Professor Soliu Adelabu, said the initiative was designed to support businesses and strengthen the state’s entrepreneurship ecosystem, praising the bank for its support for traders, entrepreneurs, and artisans in the state.
The Permanent Secretary in the Oyo State Ministry of Women Affairs and Social Inclusion, Mrs O.M. Shotonwa-Roagess, highlighted the importance of strategic partnerships in expanding economic opportunities for women and vulnerable groups across Oyo State. She noted that the ministry remains open to collaborating with organisations such as Stanbic IBTC, development partners and the private sector to drive financial inclusion, entrepreneurship and sustainable economic empowerment.
The Nigeria Business Summit Regional Tour forms part of Stanbic IBTC’s broader commitment to empowering entrepreneurs through capacity building, financial inclusion and strategic business support, helping enterprises unlock new opportunities for growth and long-term success.
The Ibadan leg built on the momentum of previous tour stops in Katsina and Aba.
By Adedapo Adesanya
The Governor of the Central Bank of Nigeria (CBN), Mr Yemi Cardoso, says Nigeria anticipates remittances from citizens living abroad to increase by two-thirds in 2026 as it seeks to bolster its foreign-exchange reserves to $1 billion monthly.
“We are expecting that by the end of the year, we will hit about a billion Dollars a month from diaspora remittances,” he said at the 14th Annual BusinessDay CEO Forum in Lagos on Thursday, themed From Stability to Shared Prosperity.
Mr Cardoso said remittances are expected to be boosted from more than $600 million currently, banking on the CBN’s deliberate target at remittances to diversify reserve sources beyond oil earnings.
According to him, the apex bank engaged Nigerians abroad, banks and international partners to identify barriers to official remittance flows.
He said the lender subsequently reviewed policies to ensure easier movement of funds into and out of the country.
Mr Cardoso described the approach as providing free entry and free exit for foreign exchange.
He said the reforms helped double diaspora inflows within one year and exceeded initial expectations, also projecting annual remittances could reach about $8 billion if the current momentum was sustained, adding that the development reflected growing confidence in Nigeria’s financial system and foreign exchange market.
Mr Cardoso said reforms introduced by the apex bank had restored stability in the foreign exchange market and improved investors’ confidence.
He identified exchange rate unification as one of the central bank’s major achievements under the reforms programme.
According to him, replacing multiple exchange rate windows with a market-driven system eliminated distortions and improved transparency.
Mr Cardoso said improved foreign exchange liquidity and stronger reserves were among the gains from the reforms.
He said Nigeria’s net external reserves had risen from about $3 billion at the start of the reforms to above $40 billion currently, noting that gross external reserves had grown to about $52 billion, representing about 10 months of import cover.
According to him, the reserves are designed to shield the economy from external shocks and excessive market volatility.
He said the reserves were not meant for routine interventions or day-to-day exchange rate management.
