Records 11% Growth in Gross Earnings to N18.2 Billion
Lagos, July 25, 2011 – Sterling Bank Plc (NSE: STERLNBANK/ Reuters: STBP.LG) – the ‘Bank’ – today released its unaudited results for the first six months ended 30 June 2011.
Speaking on the results, Yemi Adeola, Group Managing Director/CEO said:
We are pleased to announce that Sterling Bank achieved 11% growth in gross earnings and recorded 20% growth in loans & advances (including advances under a finance lease). Profit before tax and allowances for risk assets grew by 24% demonstrating the underlying strength of our core business. In line with our medium-term goals, we reduced non-performing loans (NPL) to less than 5% of total loans, an improvement from the 11.5% level reported in December 2010.
Over the next six months, our priority is to accelerate the creation of risk assets, pursue deeper market penetration of our products to gain a larger share of customer wallet and sustain the growth of the retail share of our deposit mix for enhanced margins.
The Board and Management have adopted a long term view of Sterling Bank’s appropriate strategic objectives and are aligning operations and investments to accomplish these in a manner that delivers shareholder value. To ensure adequate resources are available to pursue the objectives in the short-term, we successfully raised N7.5 billion (~US$50m) non-convertible debenture stock from a local investor group signifying confidence in our growth agenda.
Financial Highlights for the Second Quarter ended 30 June 2011
• Gross earnings rose 11% to N18.2 billion from N16.3 billion in the comparable period of 2010
• Funding costs increased 10% to N6.5 billion from N5.9 billion in the comparable period of 2010 due to a high-interest rate regime following the upward review of the monetary policy rate
• Operating income rose 12% to N11.6 billion from N10.3 billion in the comparable period of 2010 reflecting improvement in non-interest Income
• Operating expenses increased 8% to N8.4 billion from N7.7 billion resulting from inflationary pressures during the period
• Profit before Tax and Allowances for Risk Assets grew 24% to N3.2billion, while Profit after Tax stood at N2.6 billion.
• Total Assets grew by 7% to N296.0 billion from N277.1 billion in December 2010
• Deposits rose slightly by 3% to N209.1 billion from N203.1 billion in December 2010
• Net Loans & Advances (including Advances under Finance Lease) grew 20% to N124.3 billion from N103.8 billion in December 2010.
• Net Loan-to-deposit of 69% (63% in December 2010)
• Single-digit Non-performing Loans Ratio of 4.9% (11.5% in December 2010)
• Liquidity Ratio of 43%, while Capital Adequacy Ratio stood at 14%
• Annualized Return on Average Equity of 19% (34% in H1 2010)
• Net Interest Margin remained relatively stable at 48%.