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Following the completion of its rights issue program in the First Quarter (Q1) of 2025, STANBIC IBTC has successfully met its revised minimum capital requirement, with its shareholders’ equity now nearing the N1 trillion mark.
This achievement has increased the group’s equity base to N941.7 billion, compared to N661.9 billion in FY’24.
In addition to meeting regulatory compliance, the capital raise has lifted the Capital Adequacy Ratio (CAR) to 21.5%, providing significant room for expansion in risk-weighted assets.
Notably, N116.6 billion, which constitutes 80.0% of the net proceeds from the rights issue program, was allocated for lending to clients in key business segments.
Although STANBIC reported muted gross loan growth of just +0.03% Year to Date (YtD) in H1’25 and was unaffected by the CBN’s directive on banks with forbearance loans, its loan portfolio still reflected notable developments, including restructurings, reclassifications, and a review of ECL coverage adequacy.
The flat loan growth largely mirrored maturities and repayments on trade related exposure.
Restructurings were significant, specifically in the manufacturing sector, which has been Stanbic’s largest exposure—averaging 29.6% of the loan portfolio since Full Year (FY) 2020.
A total of 4.8% of STANBIC’s loan portfolio (N118.2 billion) was restructured mainly due to a single manufacturing borrower who accounted for N70.7 billion of this amount, which is higher than the total restructurings completed in FY’24 (N70.4 billion).
On reclassifications, two major oil and gas downstream facilities were downgraded from Stage 2 to Stage 3 after a marked deterioration in credit quality.
This drove a sharp rise in provisioning in Q2’25 (+N15.8 billion QoQ), compared with Q1’25 (+N4.1 billion QoQ), lifting the NPL coverage ratio by 4.3ppts YtD to 122.5%.
Oil and gas downstream exposures now account for 24.9% of NPLs, down from 26.0% in FY’24 but still above 7.0% in FY’23. Beyond oil and gas, NPL growth was driven mainly by agriculture exposures.
“We expect NPLs to remain at current levels for FY’25, barring any significant reclassification or write-offs,” analysts at Cardinal Stone Partners, said.
Stanbic IBTC Holdings Plc recorded an improvement in earnings in the first six months of the year as the lender benefited from higher interest income and fee revenue.
For the six months period to June 2025, Stanbic IBTC profit after tax (PAT) spiked by 49.05 percent to N173.43 billion from N116.35 billion as at June 2024.
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