Sterling Financial Holdings Company Plc posted a robust first-quarter performance in 2025, with profit after tax soaring to N17.2 billion, a 129% increase from N7.5 billion in Q1 2024. The significant earnings growth reflects strong core banking operations, supported by rising interest and non-interest income streams.
Key Financial Highlights:
- Interest Income Boost: The main growth driver was a 42% increase in interest income, rising from N55.3 billion to N78.4 billion. This propelled net interest income to N47.4 billion, compared to N27.2 billion in the same period last year.
- Operating Income Up 50%: Operating income reached N64.3 billion, up from N42.9 billion, bolstered by higher net fees and commission income (N10.1 billion vs. N7.1 billion) and other operating income (N3.9 billion vs. N1.6 billion).
- Profitability Maintained Despite Rising Costs: Operating expenses climbed 32% to N43.6 billion, driven by:
- Personnel expenses: N10.6 billion (up from N6.6 billion)
- G&A expenses: N14.4 billion (vs. N11.1 billion)
- Credit losses: N2.4 billion (slightly higher than N1.8 billion)
- EPS Growth Reflects Strong Returns: Earnings per share increased to 38 kobo, up from 26 kobo, reflecting the earnings boost and operational leverage.
Balance Sheet & Liquidity Position:
- Asset Growth: Total assets rose to N3.64 trillion, from N3.54 trillion in December 2024.
- Loans and advances expanded to N1.15 trillion, and customer deposits climbed to N2.58 trillion, indicating sustained balance sheet expansion and customer confidence.
- Equity base strengthened to N321.4 billion, from N305.2 billion, reinforcing the bank’s capital adequacy.
Cash Flow Dynamics:
- Net cash used in operations totalled N157.4 billion, a reversal from a net inflow of N126.9 billion in Q1 2024, largely attributed to changes in working capital.
- Investing outflows hit N103.9 billion, driven by acquisitions of debt instruments and other investment assets.
- Financing activities saw N69.1 billion in outflows, mainly due to debt repayments, reflecting a strategic move to deleverage and optimize capital.
Outlook: Sterling Financial's Q1 2025 results signal resilient earnings momentum, strong core banking activity, and prudent cost management amid rising inflationary and regulatory pressures. The continued growth in deposits and lending, alongside healthy earnings per share and a solid equity base, suggests the group is well-positioned to capitalize on further opportunities in Nigeria’s evolving financial landscape.
Despite near-term liquidity pressures reflected in operational cash outflows, the earnings trajectory and capital strength reinforce investor confidence in Sterling’s long-term value proposition.
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