Stanbic IBTC Holdings Plc is firing from all cylinders as the lender pays financial returns to its shareholders for the use of their resources, which validates the strong growth in the return on equity.
The 2022 audited financial statement of the lender shows return on equity (ROE) rose to 20.66 percent in December 2022 from 15.08 percent as at December 2021.
Return on Equity looks at how well a bank’s (or company’s) management is using its assets to create profits. The figures included in this statistic use the trailing twelve month income against the shareholders equity.
Net income was up 42.31 percent to N81.06 billion as of December 2022, the highest in 3 years.
Analysts are of the view that the high interest rate environment is having a positive impact on earnings and that bank stocks are a good buy this period.
Stanbic IBTC I is utilizing its operating resources to generate income as the cost to income ratio fell to 53.90 percent in December 2o22 from 62.30 percent as at December 2021
The bank’s Non-Interest-Revenue (NIR) grew as a result of investment in digital channels that bolstered earnings and increase in fees earned from Asset Under Management (AUM) growth.
It realised N127.32 billion in Non-Interest Revenue (NIR), which is 32.94 percent higher than 2021’s N75.73 billion.
Net interest margin rose to 4.50 percent in the period under review from 3.50 percent as at December 2021. This means the lender is able to earn more profits on the loan it gives, which also helps it to absorb a high degree of shocks.
Gross earnings were up 39.30 percent to N287.87 billion in December 2022 from N206.64 billion as at December 2021.