Stanbic IBTC Holdings profit accelerates to record N141 billion after spike in interest income

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Stanbic IBTC earned N270.6 billion in interest income compared to N152.7 billion a year ago.

Net profit at Stanbic IBTC Holdings, the local unit of Africa’s biggest bank, Standard Bank, shot 74 per cent to its peak since inception three decades and a half ago, its unaudited accounts issued Wednesday showed.

The jump was recorded on the back of higher interest income.

Unstoppable inflation continues to create a boom for Nigerian lenders, prompting the CBN to raise the reference rate by 18.6 per cent last year to slow galloping price levels, enabling banks to charge more for loans.

It earned Stanbic IBTC N270.6 billion in interest income compared to N152.7 billion a year ago.

The apex bank is expected to make its most aggressive move in curbing inflation at its rate-setting meeting this month, with Bloomberg projecting as much as a 5 per cent hike in rate.

Should that happen, the boom in interest income that banks are seeing is not likely to decelerate in the short term.

The financial services group reported a more than one-fifth jump in net fees and commissions to N117.8 billion, with brokerage and financial advisory contributing over 60 per cent.

This was made possible by the group’s big strength in the asset management space and dominance of the pensions market, where it is the market leader through Stanbic IBTC Pension Managers, whose assets under management currently are valued at more than N4 trillion.

Profit before tax came to N172.9 billion, up by 72.4 per cent, while post-tax profit climbed to N140.6 billion from N80.7 billion.

The group also set aside N15.5 billion to cover loans whose chances of repayment have been hampered by defaults.

Stanbic IBTC Holdings, through its flagship subsidiary Stanbic IBTC Bank, focuses most on lending to the manufacturing sector against the general trend among Nigerian lenders, whose exposure to oil & gas is greater than that of any other sector.