CardinalStone Research Zenith Bank Plc (ZENITHBANK: TP 29.21 - BUY)\u00a0has reported a 4.8% YoY increase in EPS to N4.80 for 9M\u201919 in its latest filing with the Nigerian Stock Exchange (NSE). The growth in earnings was largely propelled by stronger trading income (+26.3% YoY) and net fee income (+11.9% YoY). Some positives: \tGross loans grew by 12.9% to N2.2 trillion from the level as at Q2\u201919. Year-to-date, the bank has been able to grow loans by 9.3% which is an improvement from the contraction of 3.2% observed as at Q2\u201919. \tWe like that asset quality did not deteriorate, despite the strong loan growth observed in the quarter under review. Thus far the bank has been able to keep its NPL ratio within the CBN\u2019s guideline of 5.0% (9M\u201919: 4.95%; FY\u201918: 4.98%) \tWe note the 27.9% QoQ increase in net interest income during the quarter. We believe this was supported by improvement in net interest margin (NIM) from 8.6% in Q2\u201919 to 8.7% in Q3\u201919, as well as a 5bps decline in cost of funds during the period. \tOperating expenses declined by 25.7% QoQ, which we believe was partly impacted by the completion of AMCON payments for the year in Q2\u201919. Consequently, the cost to income ratio moderated to 42.1%, the lowest in over 7 quarters. We also note the 61.1% QoQ reduction in impairment charges in Q3\u201919, which, in addition to the observed growth in risk assets, led to a significant moderation in the cost of risk to 0.8% from 2.4% in Q2\u201919. \tOverall, earnings before taxes printed strongly in Q3\u201919 to N64.5 billion (+18.6% QoQ), the strongest performance in over 11 quarters. Some concerns: \tNon-interest income (-39.0% QoQ) came in weaker in Q3\u201919. Noticeably, net fees and commission income slumped by 41.4% QoQ, while net trading gains also weakened by 41.7% during the quarter. Please click\u00a0here\u00a0for the full result.