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Stanbic IBTC Holdings Plc management has said it is confident it will conveniently raise the N138 billion in capital shortfall for its national banking license.
This follows the recapitalization announcement from the Central Bank of Nigeria (CBN).
Stanbic IBTC Holdings Plc held a conference call on the 5th of April 2024 to discuss
its recently disclosed FY’23 financial results and give updates on its strategic objectives.
The company recorded a robust PAT of N140.6 billion in FY’23, 74.2% higher than
the prior year.
The outturn was aided by higher interest income, a consequence of
improvements in asset yield (11.3% vs. 9.2% FY’22) and an increase in interest
earning assets (+38.3% YoY).
Additionally, gaining from increased dollar flows, non-interest revenue (NIR) was supported by the 80.2% increase in its trading income from fixed income and currencies.
Total assets grew by 69.9% YoY to N 5.1 trillion (vs N3.0 trillion FY’22), supported
by the 69.1% growth in gross loans to N2.1 trillion.
On asset quality, despite the 67.1% increase in stage 3 loans, NPLs stayed flat at
2.4%, which is below the regulatory benchmark of 5.0%.
The CBN new recapitalisation plan states that banks with international license will be required to have a minimum paid up capital of N500.00bn (in share capital and premium only and those with National Banking license N200 bn.
This new directive mandates banks across various categories to boost their minimum capital requirement within a two-year timeframe (April 1, 2024, to March 31, 2026).
The focus of the increase lies in Tier 1 capital, specifically share capital and share premium excluding shareholders funds.
This emphasis suggests the CBN prioritizes fresh capital injections rather than simply relying on existing reserves. This is aimed at strengthening banks’ core equity base, allowing them to cushion the effect of any loss more effectively, and fueling further expansion within the banking sector.
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