Nigerian Banks have finally started publishing their half year (H1) results from late this past week, mostly owing to the delays they experienced getting approvals for their results from Regulatory bodies (mostly the CBN). The delay which had created a long period of suspense for shareholders and the investing public was mostly more noticeable this year owing to the Forbearance issue that was raised by the CBN in a dreaded letter to all banks in June. That letter raised a lot of speculations from several analysts about the health of Nigerian banks and their ability to continue with dividend payments in the near term. Some banks had to address the issue with the public, reassuring investors while others kept mute.
On the 18th of September Zenith Bank PLC blazed the trail and released their half year report, which was then followed by United Bank for Africa (UBA). Although prior to then Ecobank and Wema bank had released theirs, however, they do not belong to the lot that pay interim dividends mid-year at least of recent. The Results and following Interim Dividend announcements left investors with mixed feelings, which reflected on the banking index of the Nigerian Exchange group the next day. UBA PLC share price lost over 5% while Zenith Bank's lost over 3%; other banks quoted on the NGX also lost in their share price, including Access Holdings which lost over 4%.
Results Highlights and Interim Dividends
While the results were not bad, the interim dividends declared by both Zenith bank and UBA seemed to be below shareholders' expectation, especially for UBA. UBA had paid interim dividend of ₦2 last year and final dividend of ₦3, only to declare 25kobo this year, a meager 12.5% of their previous year interim dividend, which a lot of investors have called "disappointing". Zenith Bank declared ₦1.25 as interim dividend this year, a 25% increase from their previous year interim dividend, though a lot of investors had expected better. Zenith Bank recorded half year Net interest income of ₦1.35 trillion, ₦128 billion Net Fees and commission income, Profit before tax of ₦625 billion and Profit after tax of ₦532 billion, which translated to ₦12.95 Earnings per share. While UBA recorded half year Net interest income of ₦773 billion, ₦147 billion Net Fees and commission income, Profit before tax of ₦388 billion and Profit after tax of ₦335 billion, which translated to ₦8.86 Earnings per share (although their Capital raising exercise is still ongoing which would further increase their outstanding shares when concluded, thereby affecting the EPS). Zenith's earnings was weighed down by over ₦760 billion in Impairment charge during the period. Some of their numbers grew above previous year, while others declined, however both had relatively strong results.
Insider Share Buys
But looking at both results, of utmost interest was the significant increase in Shareholding of the founders/Chairmen of both banks and the current Group Managing Director of Zenith Bank PLC as at June 30th 2025. Jim Ovia increased his stake in Zenith Bank (direct and indirect) from 5.08 billion shares as at December 2024 to 5.8 billion shares as at June 2025, while Tony Elumelu increased his at UBA PLC from 2.5 billion shares as at December 2024 to 6.7 billion shares, an over 250% increase in shareholding. Dr. Adaora Umeoji, the GMD of Zenith Bank also increased her stake in the bank (both direct and indirect) from 91.8 million shares as at December 2024 to 275.9 million shares as at June 2025, an over 300% increase in shareholding. Most of the Executive Directors of Zenith bank PLC also more than doubled their shareholding within the same period. What stronger way to signify a massive vote of confidence in the future of their financial institutions than this.
What does this signal to Investors?
Shareholders and Investors may want to be patient, take further look at these companies' financials before determining their next move. While this signal should not be solely relied on by investors to make investment decisions, they sure could be indicative. A few years ago the current GMD of Fidelity bank PLC made similar moves increasing her stake in the bank, passing on similar signals, and in retrospect investors who followed the 'cue' have done well for themselves, with the share price of Fidelity Bank growing by over 400% over the years. In addition a number of analysts have expressed positive sentiments about the measures taken by CBN on forbearance for Nigerian banks, saying that it is positive for the industry in general and the financial health of the Institutions, which when combined with the recent capital base increase could be a catalyst for their future growth and stability in preparation to support the government's plan for a $1 trillion economy.
Well, time will tell.
We look forward to other Nigerian banks releasing their half year results and how investors would react in the coming days.
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