Gross Earnings rises by 12.0% to N28.6 Billion
Lagos, April 28, 2017 – Sterling Bank Plc (NSE: STERLNBANK / Reuters: STERLNB.LG /Bloomberg: STERLNBA: NL) – the ‘Bank’ – a full service national commercial bank releases its unaudited results for the quarter ended March 31, 2017.
In his remarks, Yemi Adeola, the Managing Director/ Chief Executive, stated:
Our first quarter performance was in line with expectations, as earnings remained resilient with double-digit growth despite the macroeconomic headwinds that persisted during the period.
We made significant progress in our efficiency drive through the adoption of strategic cost management initiatives. As a result, we recorded a 3.3% reduction in Operating Expenses and a 190 basis point improvement in Cost-to-Income Ratio. Also, Net Interest Margin improved marginally to 8.2% despite the crowding out effect of sovereign borrowing which kept interest rates high. We retained our cautious stance on lending and continued to strengthen our risk management framework across people, processes and IT systems.
Going into the year, we will continue to explore innovative ways to improve revenue, while simultaneously enhancing the overall efficiency of our business operations.
Financial Highlights
Income Statement
- Net Interest Income increased by 18.3% to N13.5 billion (Q1 2016: N11.4 billion) on account of a 26.3% increase in Interest Income;
- Net Operating Income of N14.2 billion (Q1 2016: N15.4 billion) impacted by impairment charges;
- Operating Expenses of N12.2 billion (Q1 2016: N12.6 billion) driven by our strategic cost control measures in response to inflationary pressures;
- Profit before Tax stood at N2.0 billion, while Profit after Tax was N1.9 billion.
Financial Position
- Net Loans & Advances was relatively flat at N467.4 billion (Dec. 2016: N468.3 billion);
- Customer Deposits decreased marginally by 2.5% to N570.2 billion (Dec. 2016: N584.7 billion);
- Total Assets(excluding contingent liabilities) increased by 6.8% to N891.3 billion (Dec. 2016: N834.2 billion);
- Overall, Shareholders’ Funds closed at N87.5 billion arising from organic accretion of profit.
Key Financial Ratios
| Indicator | Q1 2017 | Q1 2016 |
| Pre Tax Return on Average Equity | 9.4% | 11.9% |
| Post Tax Return on Average Equity | 8.7% | 10.8% |
| Return on Average Assets | 0.9% | 1.4% |
| Earnings per Share | 7k | 9k |
| Yield on Earning Assets | 14.7% | 13.4% |
| Cost of Funds | 6.5% | 5.3% |
| Net Interest Margin | 8.2% | 8.1% |
| Cost-to-Income Ratio | 72.9% | 74.8% |
| Indicator | Mar. 2017 | Dec. 2016 |
| Non-Performing Loan Ratio | 12.0% | 9.9% |
| Cost of Risk | 2.1% | 2.5% |
| Capital Adequacy Ratio (Basel 2) | 10.8% | 11.2% |
| Loan to Deposit Ratio (Net) | 82.0% | 80.1% |
CONTACTS
Primary Contacts:
Chimaobi Nwaokoma
M: +234 803 406 6104
E: [email protected]
Investor Relations Team
E:[email protected]
W:https://www.sterlingbankng.com/ir-home.php
