Stanbic IBTC Posts N121% Increase in Profit to N68bn in Six Months, Shares N19bn to Shareholders

• Stanbic IBTC Holdings increased profit by 121% in the first six months of the year 2023
• This was driven by an improvement in interest income for the period
• Net interest income increased to N72.7 billion in the first half of 2023

Stanbic IBTC Holdings Plc has reported its financial report for the first half of 2023.

The report shows an improvement in its profit by 121% from N30.7 billion in the first half of 2022 to N67.9 billion in the first half of 2023.

The increase in profit was triggered by the large improvement in interest income, which rose from N68.2 billion in H1 2022 to 110.3 billion in H1 2023, representing an incredible 62% year-on-year growth.

In its corporate action announcement, it disclosed that an interim dividend of 1.50 (One Naira Fifty Kobo) per ordinary share of 50 kobo each will be paid to shareholders whose names appear in the Register of Members as at the close of business on Tuesday 12 September 2023.

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It added that the amount of N19.43 billion is subject to deduction of appropriate withholding tax and regulatory approval,

Legit.ng had earlier reported that the financial institution announced the appointment of Mrs. Ndidi Nwuneli as the new Independent Non-Executive Director following the receipt of all required regulatory approvals.

The holding company also recently changed the name of its fintech subsidiary -- formerly known as Stanbic IBTC Financial Services Limited -- to ZEST Payments Limited (ZEST).

Income increased for the period

Interest income for the corporation increased significantly, which suggests that lending and investing activities have improved.

With a 110% year-over-year growth, interest expense grew dramatically as well, from N17.9 billion in H1 2022 to N37.6 billion in H1 2023.

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The greater interest expense is related to increasing borrowing expenses, which are brought on by rising interest rates.

Despite the increasing interest costs, net interest income increased to N72.7 billion in the first half of 2023, a 44% year-over-year rise.

The growth in net interest income indicates increased profitability from core lending and investing activities. With an amazing 108% year-to-year rise, the profit before tax soared to N83 billion in the first half of 2023.

The significant improvement in profit before taxes can be attributed to improved operational efficiency and efficient cost control. The cost of income tax also increased by 62%, to N15.1 billion in the first half of 2023.

Earnings Per Shares grew for the period

The company's strong financial performance is highlighted by the large growth in profit after taxes. Earnings Per Shares, EPS considerably grew by 127% from H1 2022 to H1 2023, from 2.26 to N5.12, suggesting strong earnings growth.

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According to Futureview, an investment banking company, Net Interest Margin dropped from 74% to 66%, showing a minor dip in the effectiveness of generating interest income.

It also noted that, as a result of better cost control, the operating expense margin dropped from 99% to 75%. Tax burden was minimised when the tax rate dropped from 23% to 18%. Increased profitability is indicated by the Net Profit Margin's rise from 45% to 62%.

Access Bank, Zenith Bank, Stanbic IBTC, 11 others increase interest rates on savings deposits

Legit.ng had reported that Nigerian banks have increased interest on deposits following the hike in Money Policy Rates (MPR) by the Central Bank of Nigeria (CBN).

At its last MPR meeting, the CBN raised interest rates by another 25 basis points, the sixth consecutive increase in the past 12 months, to 18.75%, from 18.50% to increase efforts to curb rising inflation.

The apex bank also narrowed the asymmetric corridor around MPR to +100/-30 from +100/-700 basis points.

Source: Legit.ng