Money market

Sterling Bank reports 65% increase in profit after tax to N8.5 bn

…proposes 2kobo dividend

By Kayode Tokede

Sterling Bank Plc releases its audited results for the year ended December 31, 2017 with profit after tax gaining 65 per cent to N8.5 billion from N5.1 billion posted in 2016.

The lender’s in its results to the Nigerian Stock Exchange (NSE) on Monday reported a Profit Before Tax that grew by 43.4per cent to N8.6 billion as against N6 billion in 2016.

Over increased growth in profit, the management proposed dividend of 2 kobo for every share of 50 kobo each.

The bank’s Gross Earnings gained 19.8per cent to N133.5billion from N111.4 billion in 2016 as Non-Interest Income rose by 87.8 per cent to N23.2 billion from N12.3 billion in 2016.

Despite sever macro economy headlines, the bank’s Operating Expenses increased moderately by 3.7 per cent to N52.5 billion from N50.6 billion reported in 2016.

Total Assets (excluding contingent liabilities) increased by 28.5per cent to N1.1 trillion (Dec. 2016: N 834.2 billion);

Overall, Shareholders’ Funds grew by 20.2per cent at N102.9 billion from N85.7billion in 2016.

The Managing Director, Sterling Bank, Mr. Abubakar Suleiman, in a statement said, “Our 2017 result highlights a positive performance across key financial indices despite challenging operating conditions, reaffirming our underlying institutional strength.

“We sustained our top-line earnings growth momentum in 2017, recording double digit growth of 19.8per cent in gross earnings to N133.5 billion in line with our medium term strategic goals. This was driven by growth in both interest and non-interest income by 11.3per cent and 87.8per cent respectively.

“In addition, net operating income rose by 7.9per cent, offsetting the moderate increase of 3.7per cent in operating expenses despite a high inflationary environment.

“Consequently, cost-to-income ratio improved by 260 basis points to 71.5per cent. We maintained a disciplined and prudent approach to loan growth in line with our risk management framework.

“This resulted in a significant improvement in asset quality as reflected in the reduction in non-performing loan ratio by 370 basis points to 6.2per cent. “Overall, profit after tax rose by 65 per cent to N8.5 billion, while liquidity and capital adequacy ratios remained sound and well above the required regulatory benchmark at 33per cent and 12.2per cent respectively.

“We continued to scale our business supported by a well-diversified funding base. For the first time, we recorded N1.1 trillion in total assets from N834.2 billion in 2016 representing a 28.7per cent growth, while shareholders’ funds rose by 20.2per cent to N102.9 billion.

“We also gained traction in our retail drive with an active customer base exceeding three million resulting in 17.1% growth in deposits.

“Our Non-Interest Banking business continued to gain significant traction and add positively to our bottom-line. This performance underscores the commitment of the entire team to our corporate goals and the resilience of our business model. During the year, we stayed committed to our plan to prioritize efficiency across the business as we progressed on our digital transformation journey. We successfully launched “Specta”; an innovative online lending platform which offers personal loans within 5 minutes.

“We invested in a first-rate business process management tool in our bid to optimize operating efficiency, while providing our customers with ‘best in class’ service. We will continue to leverage technology as an enabler, and data analytics to improve our propositions and deliver value to all stakeholders.”

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