STERLING FINANCIAL HOLDINGS PLC Q3 Result – Strong Earnings Momentum Fueled by Robust Interest Income and Trading Gains

STERLING FINANCIAL HOLDINGS PLC Q3 Result – Strong Earnings Momentum Fueled by Robust Interest Income and Trading Gains Amid Higher Operating Costs

Executive Summary

Sterling Financial Holdings Plc delivered a solid performance for the nine months ended September 30, 2025, reporting strong earnings growth driven by improved net interest income, higher fees and commissions, and significant trading and fair-value gains. The Group demonstrated resilience amid tighter macroeconomic liquidity conditions and high inflationary operating costs.

Profit Before Tax (PBT) surged 141% YoY to ₦70.96 billion, compared to ₦29.42 billion in the prior year, reflecting enhanced earning asset yields and improved treasury trading performance. Profit After Tax rose sharply by 127% YoY to ₦62.30 billion.

Net interest income increased 54% YoY to ₦143.04 billion, supported by a higher interest rate environment and increased loan book momentum. Operating income grew 58% YoY to ₦222.29 billion, while earnings per share improved to 128 kobo, up from 95 kobo in 9M 2024.

At the balance sheet level, Total Assets grew 16% YTD to ₦4.09 trillion, supported by strong customer deposit mobilization and expansion in loans and fixed income investments.

Financial Highlights – Statement of Profit or Loss

₦’ million 9M 2025 9M 2024 Q3 2025 Q3 2024

Gross Earnings / Operating Income 222,289 140,970 79,422 52,060

Net Interest Income 143,042 92,966 45,627 35,380

Credit Loss Expense (8,085) (7,161) (2,871) (2,695)

Operating Expenses (143,244) (104,391) (51,139) (37,293)

Profit Before Tax 70,960 29,418 25,412 12,072

Profit After Tax 62,297 27,446 20,522 11,184

EPS (kobo) 128k 95k — —

Revenue & Income Performance

• Net interest income grew 54% YoY to ₦143.04bn, driven by repricing of earning assets and loan book expansion.
• Fees and commission income rose significantly to ₦35.88bn (+55% YoY), supported by digital banking and payments.
• Trading income jumped 78% YoY to ₦22.78bn, reflecting treasury gains and market-making activity.
• Fair-value and investment income boosted other comprehensive income, reflecting strong securities portfolio performance.

Result: A diversified and resilient income base with strengthened treasury efficiency.

Profitability & Margins

• PBT margin improved materially, driven by higher earning-asset yields.
• Cost pressures persisted, with operating expenses rising 37% YoY due to inflation and technology investments.
• Credit loss charge remained controlled, indicating asset quality discipline.

Despite cost inflation, Sterling achieved high-double-digit profit growth, demonstrating operational leverage and strong franchise momentum.

Balance Sheet Overview

₦’ million Sept 2025 Dec 2024 Δ

Total Assets 4,091,564 3,541,940 +16%

Loans to Customers 1,217,2111,103,970 +10%

Customer Deposits 2,879,541 2,518,512 +14%

Total Equity 405,527 305,159 +33%

Interpretation

• Asset growth driven by increased loan book and investment securities.
• Strong deposit growth reinforces customer confidence and liquidity strength.
• Equity expanded meaningfully on retained earnings uplift and recapitalization.
• Capital buffers strengthened to support future expansion.

Strategic Insights

• Focused growth in core banking segments and digital financial services.
• Strong trading income highlights treasury capability and market insight.
• Continued investment in digital infrastructure and operational scalability.
• Prudent credit risk management supported by controlled impairment charges.

Strengths

• Robust interest income and diversified non-interest earnings
• Strong growth in deposits and assets
• Rising profitability and capital base
• Digital and retail banking capability strengthening

Weaknesses

• Cost growth outpacing inflation due to scale investment
• High interest rate environment driving funding cost sensitivity
• Competitive pressure in digital payments ecosystem

Outlook

Sterling is positioned for sustained earnings momentum heading into FY2026, supported by a high-yield rate environment, digital banking expansion, and treasury strength. Liquidity growth and rising loan portfolio support continued revenue expansion, however inflationary cost pressures and Naira volatility remain key considerations.

Analyst View

“Sterling delivered a strong operating and earnings performance, reflecting disciplined balance sheet management, digital growth, and robust treasury execution. While cost pressures remain a watchpoint, the Group’s sustained earnings trajectory and strengthened capital position underpin an improving long-term value profile.”

Conclusion

Sterling Financial Holdings Plc posted a solid 9M 2025 performance with significant improvements in profitability, asset growth, and capital strength. Strong interest income, trading gains, and effective cost discipline drove earnings resilience. With expanding deposit franchise and digital execution strength, Sterling remains favourably positioned for continued growth and enhanced shareholder value creation.