Sterling Bank reports 15% growth in net profit in 2019
Sterling Bank Plc has reported an audited profit after tax (PAT) of N10. 6 billion on gross earnings of N150.2 billion for the year ended December 31, 2019, compared to a net profit of N9.2 billion in the corresponding period of 2018, representing a growth of 15 per cent.
Commenting on the financial performance, Abubakar Suleiman, Chief Executive Officer (CEO) of Sterling Bank said, “In the final quarter of 2019, our relentless commitment to improving education through micro banking was rewarded with ‘The Banker’s Award for Banking in the Community’ on the global stage by the Financial Times of London.”
He said the bank was also ranked ‘top three banks in retail’ by Nigerian consumers in a KPMG banking survey – a major accomplishment for the brand – and overall, the bank delivered a 15 per cent growth in profit after tax to N10.6 billion as at December 2019.
According to Mr. Suleiman, the bank recorded an increase in gross earnings, driven majorly by growth in fees and commissions by 24.3 per cent, despite a steady loan base – as it continues to diversify into key sectors of focus – and a decline in trading income.
In 2019, the bank delivered more than 200 percent increase in loans to its retail and consumer segment with its Loan-to-Deposit Ratio (LDR) above the regulatory limit all year round.
Notably, the bank’s digital lending product continued to set the trend with more than N45 billion disbursed to more than 50,000 customers. Also, interest expense declined by 10.9 per cent driven by a 19.4 per cent year-on-year increase in low-cost deposits as the Bank continues to grow its Retail & Consumer base, resulting in a 110 bps drop in the cost of funds and consequently, a 130 bps increase in net interest margin.
According to the CEO, the Bank’s cost-to-income ratio remained relatively flat year-on-year, even as operating expenses grew on the back of staff salaries and wages and spend on technology infrastructure as well as digital platforms.
Suleiman said the bank grew its deposit base by over N130 billion in deposit during the 12-month period, representing over 75 per cent growth from its 2018 performance of about N75 billion, and shareholders’ funds grew by 22.2 percent at the end of the year.
He also noted that investments in technology have also allowed the bank to continuously record steady growth in the instant payments market contributing to the bank’s transactional revenue.
Also, the bank has continued to see traction in machine supported transactions, driven by the adoption of its digital channels. As a direct result, Sterling’s NIBBS Instant Payments (NIP) transaction volume grew by 78 per cent compared to the previous year, faster than the industry growth while recording the fastest growth in Fees & Commission income in comparison with its peers.
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