Zenith Bank Redeems $500m Eurobond From Cash Reserves

By Modupe Gbadeyanka

The management of Zenith Bank Plc has announced the redemption of its matured $500 million Eurobond due April 22, 2019.

In a notice pasted on the website of the Nigerian Stock Exchange (NSE), the lender said the bondholders were settled from its available cash reserves.

On April 22, 2014, Zenith Bank issued the $500 million Eurobonds under its $1 billion global medium term note program.

Business Post reports that the Eurobonds, with a 5-year tenor, were sold to investors at a coupon of 6.250 percent.

The outstanding balance of $500 million of the $1 billion global medium term note was later issued in May 2017 and is expected to mature in May 2022.

In the notice to the NSE, Zenith Bank said “leveraging on its strong and highly liquid balance sheet as well as its outstanding treasury management capability, completely redeemed the note using the bank’s available cash reserves.”

Over the years, the bank has continued to maintain its deep understanding of the market to sustain its consistent operational metrics of strong liquidity, capital and asset quality ratios, reflecting the lender’s robust risk management practices strong corporate governance culture and a well-articulated corporate strategy.

Business Post reports that in the 2018 financial year, the gross earnings of Zenith Bank declined by 15.4 percent to N630.3 billion from N745.2 billion recorded in the 2017 fiscal year.

However, the net interest income rose to N295.6 billion from N258 billion, while the net income on fees and commission dropped to N81.8 billion from N82.6 billion.

Also, the trading gains went down to N80.2 billion from N158 billion, while the other operating income closed at N17.9 billion in contrast to N22.4 a year earlier.

In the period under review, the personnel expenses rose to N68.6 billion from N64.5 billion, while the operating expenses dropped to N137.9 billion from N144.9 billion.

In addition, its profit before tax rose to N231.7 billion from N199.3 billion, while the profit after tax appreciated to N193.4 billion from N173.8 billion.

Furthermore, its total assets slightly increased to N5.956 trillion in 2018 from N5.595 trillion in 2017, while the total liabilities increased to N5.140 trillion from N4.783 trillion.

At the conference call for its FY 2018 earnings, Zenith Bank stressed that it has no immediate plan to approach the debt market to borrow fresh funds to boost its operations and revenue after the expiration of the $500 million Eurobond, which matured on April 22, 2019.