Stanbic IBTC Holdings Q1 2026 PAT rose 40.3% to N113.7 billion

Stanbic IBTC Holdings delivered a strong Q1 2026 (unaudited) performance, with profit after tax rising by 40.3% y/y to N113.7bn, supported primarily by a sharp expansion in non-interest revenue. Non-interest income more than doubled (+145% y/y) to N130.3bn, driven by a significant turnaround in trading income, which recorded a gain of N55.2bn compared to a N7.0bn loss in Q1 2025. In addition, net fee and commission income grew by 25.1% y/y to N75.4bn, reflecting stronger asset management and brokerage activities.

This robust non-interest income performance more than offset a 9.4% y/y decline in net interest income to N135.8bn, as interest expenses rose sharply (+65.1% y/y), outpacing the modest 3.2% growth in interest income. As a result, net interest margin compressed significantly to 8.6% (from 13.8% in Q1
2025), highlighting margin pressures from elevated funding costs.

Cost efficiency improved markedly during the period, with operating expenses increasing by a relatively modest 8.7% y/y to N97.9bn, significantly below the growth in gross earnings. This drove a 48.9% y/y increase in pre-provision operating profit to N168.2bn and a 42.0% y/y rise in profit before tax to N165.4bn. Consequently, the cost-to-income ratio improved substantially to 36.6% (from 44.2%), underscoring
strong operating leverage.

Asset Quality

On asset quality, the Group recorded a net impairment charge of N2.9bn, compared to a write-back of N3.4bn in the prior year, translating to a cost of risk of 0.5% (vs. -0.6% in Q1 2025). This reflects a more prudent provisioning stance in the current macro environment, even as underlying asset quality improved, with the NPL ratio declining to 3.5% from 5.3% in the comparable period.

On the balance sheet, total assets expanded by 12.6% year-to-date to N9.70trn, largely driven by a 53.6% increase in securities holdings to N3.61trn, alongside a significant reallocation within liquid assets, as interbank placements declined sharply (-76.2% year-to-date). Net loans grew modestly by 4.4% year-to-date to N2.48trn, indicating measured risk asset expansion.

Funding Dynamics

Funding dynamics shifted during the period, with customer deposits declining by 6.7% year-to-date to N4.08trn, while interbank funding increased by 28.5% to N526.4bn, suggesting a change in liquidity mix amid tighter system liquidity. Despite this, the Group’s capital position strengthened significantly, with CAR rising to 20.5% (from 15.8% in FY 2025), supported by an increase in Tier I capital to 16.6%.

The results highlight a diversified earnings base, where strong growth in non-interest income and improved cost efficiency offset margin compression in core lending activities. While funding costs and a shift in deposit mix remain key risks, the Group’s strong capital buffers, improving asset quality, and resilient fee-generating businesses position it well to sustain earnings momentum in the near term. SOURCE: Coronation Asset Management