Stanbic IBTC Holdings Plc listed on the Nigerian Exchange under the banking sector has released its 2022 interim results for the half year. The results showed a profit of N31 billion, 36 per cent higher than N23 billion it reported in the first half of 2021.
Uptick in economic activities, the bank’s continued focus on loan and deposits growth accelerated its gross earnings to N135 billion in the six months review period ended June 30, 2022. . The bank’s commitment and investments in non-oil sector support the Central Bank of Nigeria’s policy to grow non-oil revenue and achieve sustainable economic growth.
The Covid-19 pandemic was one of the worst challenges faced by many businesses. The lockdowns, the drop in consumer purchasing power and even government revenues impacted negatively across major sectors of the economy.
But economic activities began to accelerate in the first half of 2022, reversing poor economic activities and rewarding hard working companies with earnings growth.
For instance, the Purchasing Managers’ Index (PMI), showed that a return to growth in output and stronger inflows of new orders helped underpin a further improvement in operating conditions in the Nigerian private sector during July.
The report showed that businesses increased their purchasing activity at the strongest rate for five months while stocks increased sharply. Despite stronger inflows of new work, employment growth eased and was marginal amid elevated costs and subsequent pressures on profits.
Stanbic IBTC Holdings Plc was one of the financial institutions that showed strength in the first half of 2022.
It announced N30.67 billion profit after tax in its audited half year ended June 30, 2022 and a gross earnings of N135 billion.
The profit after tax result represents an increase of 36 per cent from N22.54 billion reported in half year ended June 30, 2021.
The group on the floor of the Nigerian Exchange Limited (NGX) reported N39.98 billion profit before tax in first half of 2022 from N24.71 billion reported in first half of 2021.
Amid growth in profits, the management of Stanbic IBTC Holdings declared interim dividend of N1.50 per ordinary share of 50 kobo each, that is, N19.44 billion, and it subject to deduction of appropriate withholding tax and regulatory approval.
Net interest income/ non-interest income
The performance in profits was driven by significant increase in net interest income and non-interest income.
Stanbic IBTC Holdings reported N50.35 billion net interest income in first half of 2022, representing an increase of 53 per cent from N32.88 billion in first half of 2021, while non-interest revenue stood at N62.96 billion in 2022, up by 37 per cent from N45.91 billion reported in 2021.
The Group reported a total assets of N3.15 trillion as of June 30, 2022, an increase of 15 per cent from N2.74 trillion reported in full year ended December 31, 2021, driven by sharp increase in Gross loans and advances.
Customer deposits soar
For the under review, Stanbic IBTC Holdings announced a gross loans and advances of N1.09 trillion as of June 30, 2022, an increase of 16 per cent from N946.26 billion reported in 2021 financial year, while customer deposits increased by six per cent to N1.19 trillion as of June 30, 2022 from N1.13 trillion reported in 2021 financial year.
Commenting on the results, Chief Executive Stanbic IBTC Holdings, Demola Sogunle said: “Despite the challenges we faced within the Nigerian operating environment in the first half of the year, we reported significant growth in our key metrics.
“Following our return to growth trajectory in the first quarter, the Group’s profitability increased by 36 per cent year-on-year (YoY) driven by growth across our revenue streams, amid increased operating expenses.
“Our continued focus on the core of our business which is to grow our loan and deposit books, led to a 54 per cent growth in interest income year-on-year.”
He added that “Aligning with our commitment towards delivering to our shareholders, an interim dividend of N1.50 has been declared.
“We are on track in the achievement of the guidance we provided for the year following the progress we have witnessed based on our first half 2022 results.”
Indicative share trading liquidity
The total indicative share trading liquidity for Stanbic IBTC Holdings Plc in the past 12 months, as of August 2, 2022, is $13.59 million (N10.12 billion). An average of $1.13 million (N843.72 million) per month.
Stanbic IBTC Holdings Plc, for it’s first half 2022 financial results has posted a profit of N31 billion, a 36 per cent increase from the N23 billion it reported in the first half of last year.
According to he results submitted to the Nigerian Exchange Limited (NGX), the company saw its gross earnings rise by N42 billion from N93 billion in the half year 2021 to reach N135 billion in half year 2022.
Further look at the result indicated that the net interest income stood at N50 billion in the first half of 2022, indicating a jump from the 32 billion in the same period last year.
This is as the net income and net expenses were valued at N68 billion and N18 billion respectively in the study period compared to N44 billion and N11 billion in the first half of last year.
Net fees and commission revenue were N46 billion from N41 billion in 2021 with the most income from Asset management fees at N28 billion followed by a brokerage and financial advisory fees at N5.8 billion and others during the period of study.
Fees and commission expenses was N2.635 billion, a slight movement from the N2.626 billion in 2021.
Similarly, the income from life insurance activities was valued at N136 million after the insurance premium revenue ceded to reinsurers and insurance benefits and claims paid were deducted from the insurance premium received.
Notably, the group saw massive growth in the record of gross premium income at N7.4 billion from the low record of N453 million last year. The difference signifies proof of return to economic activities compared to last year when many businesses still struggled to get back on their feet.
Trading revenue was up to reach N16 billion in first half of 2022 from N5.4 billion and other income was valued at N938 million in first half of 2022 from a loss of N904 million in 2021.
Stanbic IBTC saw operating expenses go up to a value of N68 billion as a result of an increase in staff costs and other operating expenses.
Interim dividend payout
Stanbic IBTC Plc announced an interim dividend of N1.50 per ordinary share of 50 kobo each, subject to deduction of appropriate withholding tax and regulatory approval.
In a disclosure filed to the exchange by the company, this will be paid to shareholders whose names appear in the register of members as at the close of business on Tuesday 6th September 2022.
It also added that the register of shareholders will be closed from Wednesday 7th September 2022 to Wednesday 14th September 2022.
“In its corporate action announcement, it stated, “On Wednesday 21 September 2022, dividends will be paid electronically to shareholders whose names appear on the Register of Members as at close of Trading on Tuesday 06 September 2022, and who have completed the e-dividend registration and mandated the Registrar to pay their dividends directly into their Bank accounts.”
“It added that shareholders with dividend warrants and share certificates that have remained unclaimed or are yet to be presented for payment or returned for validation are advised to complete the e-dividend registration or contact the registrars”.
Improved purchasing activities for businesses
Further analysis of the PMI report showed that purchase and output price inflation accelerated to four-month highs in July, with unfavourable exchange rate movements and higher fuel costs behind the latest round of inflation.
Nevertheless, sentiment improved from June, and firms reported hopes of securing greater business investments.
“The headline figure derived from the survey is the PMI.
Readings above 50.0 signal an improvement in business conditions on the previous month, while readings below 50.0 show a deterioration. The headline PMI registered at 53.2 in July, up from 50.9 in June, signaling an improvement in business conditions in Nigeria’s private sector. The latest figure rose from June’s 17-month low but was still muted compared to the historical average,” the report showed.
A renewed increase in output supported the latest improvement in business conditions in July. Output rose solidly, albeit at a rate that was weak by historical standards. Agriculture recorded the strongest uplift in output during July, followed closely by manufacturing. Services and wholesale & retail followed, where rates of growth quickened from those seen in June. Stronger client demand was behind the uplift in output with new orders rising sharply across all four sectors in July.
To support higher output, companies increased their purchasing activity for the 25th month in a row. Consequently, stocks of purchases rose markedly as firms intensified efforts to build up their inventories. Moreover, the rate of growth was the steepest for seven months.
Vendor performance improved in July, but to the least extent for over two years amid reports of busier road conditions.
Outstanding business fell at the softest rate since August 2020 in July. Sufficient capacity combined with rising costs led firms to raise their head counts at the slowest pace for seven months.
Lifting non-oil export earnings
Stanbic IBTC Bank also reiterated its commitment to the Central Bank of Nigeria’s (CBN) RT200 FX Policy, designed to increase the earnings from non-oil exports to $200 billion in foreign exchange repatriation.
Head, Trade, Transactional Products and Services, Stanbic IBTC Bank, Seun Ogundolapo, who stated this during the Africa-China Trade Expo in Lagos, said the event was to promote trade relations and economic prosperity in the two regions.
The event, themed ‘Synergy for Growth’, focused on export enablement and import policies, bilateral trade relations, product exhibitions by Nigerian and Chinese businesses, and the various means through which Stanbic IBTC had facilitated trade between Nigeria and China.
He said the forex target within the next five years by the CBN, led by its Governor, Godwin Emefiele, aligned with the bank’s mandate to promote exports of agro commodities and semi-finished or finished goods to other countries.
He urged more businesses to go into export as well as prompt exporters to add value to the commodities they export.Chief Executive of Stanbic IBTC Bank, Wole Adeniyi, said the bank’s Africa China Trade Solutions (ACTS) had connected numerous Nigerians to over 16,000 Chinese suppliers, thereby promoted valuable trade relationships between the two economies.
He said: “Through our relationship with the Industrial and Commercial Bank of China (ICBC), we connect various businesses while we create opportunities to generate foreign exchange for the country.” The need for business-friendly import and export policies was addressed at the event.
