Zenith Bank, a Nigerian multinational financial services provider, expects loan volumes to return to growth this year after 2018’s decline. The bank said it is targeting higher activity in the agricultural sector.
The lender said it aimed to grow loans by 7.5 percent in 2019 after the bank declined last year as a result of early repayments, saying borrowers were replacing overdrafts with term loans. It had guided for loans to grow 2.5 percent in 2018.
Zenith Bank said “our expectation is that the economy will continue to strengthen. It will throw up opportunities to grow the loan book”.
Nigeria’s economy expanded in 2018 at its fastest pace since a recession two years earlier, while inflation fell in January from a seven-month high. Zenith Bank said there are opportunities in the agricultural sector, which receives good support from the Nigerian government. The bank also noted that as the economic recovery continues, it could also open up opportunities to lend to manufacturers.
The bank posted a 16.2 percent rise in pretax profit to 231.7 billion naira for 2018. Its shares have risen 25 percent from their January lows, though they fell 1.94 percent on Thursday.
Zenith bank revealed that its $500 million eurobond matures in April and it plans to repay the bond from its cashflow. The bank said there was no need to immediately tap the market again.