Stanbic IBTC Posts Strong Half-year Performance, Grows Profit by 121%

•Sets N1.50 interim dividend record

Stanbic IBTC, a member of Standard Bank Group, has announced its six months audited results for the period ended 30 June 2023, which showed that its profit after tax rose significantly by 121 per cent to N67.92 billion, compared to N30.67 billion as of the first half of 2022.

Also, its total operating income stood at N171.30 billion, up 51 per cent, compared with the first half 2022 figure of N113.31 billion, while profit before tax was N82.99 billion, up 108 per cent, as again the N39.98 billion garnered in the comparable per cent of 2022, and cost to income ratio of 48.1 per cent (H1 2022: 59.9%).

The results released yesterday, also showed that the bank’s total assets increased by 47 per cent to N4.45 trillion, up from N3.03 trillion recorded in December 2022.

Its gross loans and advances increased by 37 per cent to N1.70 trillion, higher than the N1.24 trillion it stood as of December 2022, while non-performing loan to total loan ratio was 2.34 per cent, compared to 2.4 per cent as of December 2022.

Similarly, customer deposits increased by 32 per cent to N1.64 trillion, up from N1.25 trillion as of December 2022, just as deposit mix improved to 74 per cent, from 71.7 per cent as of December 2022.

Net interest income was N72.68 billion, up 44 per cent (H1 2022: N50.35 billion) and non-interest revenue of N98.62 billion, up 57 per cent (H1 2022: N62.96 billion).

Commenting on the results, the Chief Executive Stanbic IBTC, Dr. Demola Sogunle said: “The first half of 2023 was an eventful one for us as an organisation within the Nigerian operating environment.

“Events such as the general elections and cash scarcity led to relatively slower business activities at the beginning of the year, causing the Stanbic IBTC Bank Purchasing Manager Index (PMI) to print below 50 index points.

“Business activities however picked up in the second quarter, with the PMI moving back above 50 points in April 2023 and closing at 53.2 in June 2023, following the improvement in access to cash, increase in customer demand and business expansion.

“We reported significant growth in our key income lines during the period under review. The Group’s profitability increased by over 100 per cent year-on-year (YoY) driven by growth across our revenue streams.

“Interest income grew by 62 per cent year-on-year (YoY), mainly due to higher yield and volume of loans and investments, which is in line with our efforts to support our clients through loan offerings and investment opportunities.

“Net fees and commission income increased by 12 per cent YoY, attributable to increase in fees earned on letters of credit and growth in fees from digital banking transactions following an increased uptake of our digital channels.

“Growth in trading income was sustained due to improved FX trading activities and FX revaluation gains. Our operating expenses on the other hand, increased by 21 per cent YoY, in light of the persistent increase in inflation and growth in staff costs following an upward review of employee incentives within the period.

“Despite this, we saw an improvement in our cost-to income ratio from 59.9 per cent in the prior year to 48.1 per cent.”

He added: “We continue to support the growth of our clients by providing solutions that aid their expansion. Stanbic IBTC Bank successfully processed the first inbound commercial transaction on the Pan African Payment and Settlement System (PAPSS) in Nigeria, an initiative of the African Union and the African Continental Free Trade Area (AfCFTA) Secretariat, designed to promote intra-African trade and economic integration.

“This demonstrates our efforts to provide our clients with efficient and secure payment and settlement solutions across Africa. We will continue to leverage our expertise to provide solutions that enable our clients unlock the full potential of the African market.

“We also demonstrated our support for women empowerment through the launch of our Blue Blossom community for Nigerian women in a bid to provide them with invaluable benefits that meet their unique needs. We launched the Blue Blossom Community to enable women access financial and non-financial services, such as investments, retirement services, children accounts, free access to capacity- building sessions and other special events. “Members of this community will enjoy benefits such as free business clinics, career or business development sessions, mentorship through masterclasses, access to CHESS account for their children and access to the market.

“Again, we retained our Fitch AAA (nga) rating, re-affirming our position as the only financial services provider in Nigeria with the highest rating from a global rating agency.

“Achieving our ESG and sustainability goal is crucial to fulfilling our promise of doing business the right way. In the first half of the year, we demonstrated commitment towards promoting financial inclusion, inclusive quality education, and climate action.

“We organised 83 financial awareness sessions, with about 3,500 participants to promote financial literacy in Nigeria. We also made donations and provided scholarships to support the education sector. This is in addition to the credit facilities of over N1.37 billion disbursed to educational service providers in Nigeria.

“As a way of supporting the achievement of net zero emissions, we recycled about 7.3 tonnes of waste papers in return for tissue papers and 44 office locations out of 187 ran on solar powered energy solutions in the first half of 2023.

“We have made very good progress in the first half of the year and we will continue to work towards the delivery of our guidance for 2023.”

Furthermore, the results also stated that the Group also maintained strong and diversified funding base during the first half of 2023 as its liquidity ratio closed at 101.22 per cent, well above the 30 per cent regulatory minimum requirement, indicating the Group’s commitment to meeting its liquidity obligations in a timely manner.