Stanbic IBTC Profit Soars 52.8% as Interest Income Hits ₦584bn

STANBIC maintained its impressive earnings momentum through the first nine months of 2025, with stanbic ibtc profit bolstered by strong interest income, reduced credit impairment costs, and efficient cost management. The Group’s net profit rose sharply by 52.8% year-on-year to ₦275.19 billion, up from ₦180.12 billion in the same period of 2024, resulting in earnings per share of ₦17.31 compared to ₦11.33 previously. This strong performance was driven by consistent balance sheet growth, improved margins, and disciplined risk management across both its banking and wealth management divisions.

Net interest income climbed 58.2% year-on-year to ₦454.59 billion, supported by a 45.7% rise in interest income to ₦584.31 billion, largely reflecting higher returns on loans and investment securities. Meanwhile, interest expenses increased by just 14.0% to ₦129.7 billion, allowing the bank to sustain a healthy expansion in its net interest margin. The Group’s net interest margin improved by 290 basis points year-on-year to 14.9%, driven by a higher asset yield of 17.6% and a slightly lower funding cost of 4.1%, compared to 4.2% in the prior year. Interest-earning assets expanded by 37.6% year-to-date to ₦5.61 trillion, primarily from a surge in investment securities, which grew by 78.2% to ₦2.99 trillion, while the loan portfolio eased slightly by 2.2% to ₦2.42 trillion.

Non-interest revenue rose 14.4% to ₦200.58 billion, supported by a robust 38.5% increase in fee and commission income to ₦172.59 billion, boosted by growth in asset management, brokerage, and digital banking services. However, trading revenue declined 46.7% to ₦23.86 billion due to weaker performance in the fixed-income and foreign exchange segments earlier in the year. Encouragingly, trading income rebounded significantly in the third quarter, surging by 304% quarter-on-quarter, indicating a possible recovery in market activity toward year-end.

Operating expenses rose 36.0% to ₦249.69 billion, reflecting higher personnel costs, regulatory fees, and inflationary effects. Despite these pressures, revenue growth outpaced costs, leading to further operational efficiency gains. The cost-to-income ratio improved to 37.9% from 39.3% in 2024, underscoring Stanbic’s disciplined expense management and continued investment in digital transformation.

Loan Performance

Loan impairment charges dropped sharply by 80.4% to ₦11.64 billion, driven by improved recoveries and strong credit monitoring. Consequently, the cost of risk improved to 0.7%, compared with 3.5% a year earlier. Although the non-performing loan ratio edged higher to 5.2% from 4.6%, it remains within manageable levels. The improvement in asset quality contributed to a 76.7% jump in pre-tax profit to ₦393.8 billion, while net profit rose to ₦275.29 billion after accounting for a higher tax charge of ₦115.36 billion, which increased by 188.0% year-on-year. Profitability ratios remained strong, with return on average equity climbing to 47.2% from 42.9%, and return on average assets improving to 5.5%.

Balance Sheet

The Group’s balance sheet reflected solid expansion, with total assets up 21.3% year-to-date to ₦8.38 trillion. Customer deposits grew by 38.8% to ₦4.18 trillion, highlighting Stanbic’s strong retail and corporate deposit base. The significant 78.2% rise in securities holdings also boosted its income-generating asset pool. Following the completion of its rights issue, Stanbic IBTC successfully met the Central Bank of Nigeria’s recapitalization benchmark of ₦200 billion required for banks with national licenses.

Looking ahead, Stanbic IBTC is expected to maintain its strong growth trajectory into the final quarter of 2025, supported by steady revenue generation, recovering trading income, and continued cost discipline. Its diversified business model—spanning banking, wealth management, and pensions—provides a solid buffer against earnings volatility. With robust capitalization and industry-leading profitability ratios, the Group’s full-year 2025 net profit is projected between ₦275.18 billion and ₦304.15 billion, translating to a potential return on equity above 39.1%. Based on an upward revision of its blended valuation, the fair value estimate has been raised to ₦118.11 per share from ₦106.77, representing a 7.4% upside from the current market price of ₦110.00 as of October 29, 2025. Accordingly, the stock is maintained at a HOLD recommendation. SOURCE: Coronation Securities Limited