Stanbic IBTC records improvement in key metrics in Q1’21

Stanbic IBTC, a member of Standard Bank Group, has announced its three months unaudited results for the period ended March 31, 2021.

Commenting on the results, Demola Sogunle, Chief Executive Stanbic IBTC, said: “The domestic economy remains quite fragile. Negative real returns prevailed in the first quarter as headline inflation continued on the rise, currently above 18percent as of March 2021.

Economic activities are expected to improve as the authorities take on appropriate actions and business confidence improves. Just recently, in April 2021, the CBN resumed dollar sales to foreign portfolio investors for the first time since December 2020 to clear the backlog of foreign exchange demand.

The Group’s profitability in the first quarter moderated year-on-year due to pressure on trading income: trading activities in our Global Markets business slowed down compared to prior year, operating expenses from regulatory induced charges increased, as well as the continued pressure on risk asset yields.

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The decline was partly cushioned by the year-on-year improvement in net fee and commission revenue as well as an impairment write back of N155 million in Q1 2021 compared to the charge of N1.97 billion in prior year. The impairment writeback was due to releases and after write-off recoveries achieved during the quarter.

Again, the diversity of our earnings proved supportive during the period. Wealth’s profitability improved from prior period and provided succour for the contraction in profitability of the Corporate and Investment Banking and the Personal and Business Banking businesses. That said, gross customer loans continued to grow, increasing by 16percent from the December 2020 position.

The continued loan growth would support margin accretion and ultimately compensate for the pressure on yields. Customer deposits also increased by 6percent from the December 2020 position, most of the growth arose from cheap deposits and resulted in further improvement in the CASA ratio to 83.3percent (FY 2020: 82.8percent), which was positive for our funding costs. Our capital and liquidity positions remained robust in Q1 2021.

“Our latest addition, Stanbic IBTC Insurance Limited commenced full operations during the quarter. Our Pension business introduced the Loyalty program, UMatter, to appreciate our esteemed clients. Our Asset Management business launched the Stanbic IBTC Enhanced Short-Term Fixed Income Fund which invests in short term bonds issued by the Government and corporate entities. We are committed to achieving our Full Year 2021 Guidance”