Loan Loss Write-Back, Other Revenue, Lift Stanbic IBTC 9-Month Profit To N59.76bn

Signs that directors of Stanbic IBTC Holdings Plc, the Nigerian arm of South Africa’s Standard Bank Group could recommend an even juicier dividend at year end in December, emerged Friday, when the company presented its unaudited financials for the nine-month ended September 30, 2018.
This followed the impressive 58.62% growth in net profit for the period, helped by loan loss write-back of N4.14bn, compared to the net impairment loss on financial assets at N20.33bn in the prior nine months and the equally robust 72.42% rise in other revenue from N0.78bn to N1.34bn.
According to the financials, Stanbic IBTC’s revenue only managed to rise by 9.45% from N154.22bn in 2017, to N168.8bn; helped by the N87.89bn interest income, a drop by 2% from N89.68bn; while interest expenses climbed 10.13% to N29.45bn, from N26.74bn. Net interest revenue therefore rose to N79.97bn, 24.42% better than N64.28bn in 2017.
Fee and commission income improved by 23.62% to N53.86bn, from N43.57bn; just as fee and commission expense soared 266.8% from N0.26bn in 2017, to N0.94bn; trading revenue improved 27.36% from N20.2bn to N25.72bn; and other revenue from N0.78bn to N1.34bn.
Other operating expense increased by 17.85% from N61.24bn, to N72.17bn, the biggest of which was the N7.431bn Asset Management Corporation of Nigeria (AMCON) expenses, a rise from N4.926bn; followed by information technology expenses of N5.391bn from N3.588bn; among others.
Consequently, profit before tax of N70.38bn, up by 54.17% from the N45.65bn reported in the prior nine-month.
Income tax expense for the period rose marginally to N10.623bn; as against the previous N7.978bn, as net profit closed for the period at N59.76bn, representing Earnings Per Share of N5.73; compared to N37.672bn, or N3.61 each.
Total assets for the period rose to N1.543tr, from N1.386tr; the bulk of which was the loan and advances to customers, which stood at N429.994bn, up from N372.088bn; just as total liabilities climbed from N1.201tr in 2017, to N1.325tr, fueled by customer deposits, which dropped from N753.642bn, to N638.356bn.
A breakdown of the report showed that while the corporate and investment banking segment remained the biggest income earner, with N70.541bn, up from the previous N67.739bn, it was followed by the personal and business banking segment with N35.838bn, as against the N33.372bn in 2017. The wealth segment recorded N35.542bn, up from N28.4bn. Corporate and investment bank, however recorded a N3.606bn credit write back, compared to the previous N6.189bn impairment charge; while personal and business bank got N517m write back, as against the previous N14.145bn charge.
The lion’s share of the profit came from the corporate and investment banking business, which posted a N41.934bn net profit, up from N35.577bn; followed by N17.294bn by the wealth segment, from N13.914bn; while personal & business bank recorded a humble N529m, which was far better than the previous N11.819bn loss in 2017.