1
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Market and Shareholderinformation
Otherinformation
Group resultsin brief
Analysis of financial results for the six months ended 30 June
Stanbic IBTC Holdings PLC
2014
1
Group results in brief
Business unitreview
Balance sheet analysis
Capital management
Market and Shareholderinformation
Otherinformation
2 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Group results in brief Income statementanalysis
Group results in briefPerformance highlights
Financial results, ratios and statistics
Half year performance
Summarised income statement
Statement of comprehensive income
Group income statement quarterly analysis
Statement of financial position
Group financial position quarterly analysis
Statement of cash flows
Statement of changes in equity
Business unit reviewSegmental structure for key business units
Segmental income statement
Personal & Business Banking
Corporate & Investment Banking
Wealth
Income statement analysisOverview of group income
Net interest income and margin analysis
Non-interest revenue
Impairment charges
Operating expenses
Taxation
Balance sheet analysisOverview of group consolidated assets
Loans and advances
Loans and advances performance
Deposits and current accounts
Funding and liquidity
Capital managementReturn on ordinary equity
Risk weighted assets
Market and shareholder informationMarket capitalisation and price-to-book ratio
Dividend payment history
Equity and range analysis
Share capital history
Other informationFinancial and other definitions
Contact details
3
4
8
10
11
12
13
14
15
16
21
23
24
30
35
39
41
43
45
47
49
52
54
56
60
62
67
68
70
70
71
71
73
74
All results in this booklet are presented on an IFRS (International Financial Reporting Standards) basis.
Contents
3
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Market and Shareholderinformation
Otherinformation
Group resultsin brief
2 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Group results in brief
Group results in brief
Fitch rating
AAA(nga)(2013: AAA(nga))
Liquidity ratio
76.3% (statutory minimum: 30%)
Price to book
2.4 times (FY 2013: 2.3 times)
Deposit from customersCAGR (1H 2012-1H 2014): 20%
Total income
Profit after tax
Profit after tax/total income
0
400
500
300
200
100
600
246.2
355.4 370.0
416.4
511.8
FY 2012H1 2012 1H 2013 FY 2013 1H 2014
Nbillion
10
Total income
N50,257 million20% up
Gross earnings
N61,478 million13% up
Performance highlights
Profit before tax
N19,617 million50% up
Profit after tax
N15,895 million56% up
Gross loans & advances
N356,910 million(FY 2013: N303,306 million)
Return on average equity
28.9%
(H1 2013: 21.3%)
Deposit liabilities
N511,763 million(FY 2013: N416,352 million)
Cost-to-income ratio
58.1% (H1 2013: 63.2%)
Credit loss ratio
0.8% (H1 2013: 1.6%)
NPL/total loan ratio
4.8% (FY 2013: 4.4%)
Capital adequacy ratio – group
19.8% (FY 2013: 24.5%)
Capital adequacy ratio – bank
13.5% (FY 2013: 18.3%)
Total income and profit after taxCAGR (1H 2011-1H 2014): Total income: 21%
Profit after tax: 60%
Group results in briefPerformance highlights
Financial results, ratios and statistics
Half year performance
Summarised income statement
Statement of comprehensive income
Group income statement quarterly analysis
Statement of financial position
Group financial position quarterly analysis
Statement of cash flows
Statement of changes in equity
3
4
8
10
11
12
13
14
15
16
1H 2011 1H 2012 1H 2013 1H 20140
50,000
40,000
30,000
20,000
10,000
60,000
0.0
30.0
25.0
20.0
15.0
10.0
5.0
35.0
Nbillion
28,207
3,849
31,048
4,993
42,005
10,185
50,257
15,895
5
%
5
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Market and Shareholderinformation
Otherinformation
Group resultsin brief
4 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Group results in brief
Financial results, ratios and statistics
Change % 1H 2014 1H 2013 FY 2013
Profit before tax Nmillion 50 19,617 13,094 24,617
Banking business Nmillion 48 10,984 6,519 9,474
Personal & Business Banking Nmillion 83 (714) (4,142) (7,696)
Corporate & Transactional Banking Nmillion 10 11,698 10,661 17,170
Investment Banking Nmillion 18 1,559 1,316 4,093
Wealth Nmillion 35 7,074 5,259 12,259
Balance sheet
Total assets Nmillion 19 906,838 818,336 763,046
Loans and advances (net of credit impairments) Nmillion 18 342,214 280,837 289,747
Deposit liabilities Nmillion 23 511,763 370,020 416,352
Key performance indicators
Net interest margin % 5.6 4.9 5.2
Non-interest revenue to total income % 54.2 57.3 56.6
Cost-to-income ratio % 58.1 63.1 68.0
Return on average equity % 28.9 21.3 21.0
Return on average assets % 3.8 2.7 2.9
Basic earnings per share kobo 58 146 93 186
Net asset value per share kobo 19 1,096 918 943
Shareholders' equity Nmillion 109,551 91,759 94,313
Other indicators
Price-to-book (P/B ratio) times 3 2.4 1.7 2.3
Effective tax rate % 19.0 22.4 15.6
Average number of employees (1) 2,053 2,138 2,077
Change % 1H 2014 1H 2013 FY 2013
Balance sheet
Total assets Nmillion 19 859,833 798,344 725,100
Loans and advances (net of credit impairments) Nmillion 18 342,214 280,837 289,749
Deposit liabilities Nmillion 22 513,270 383,915 419,032
Selected returns and ratios
Return on average equity % 27.8 17.1 15.0
Return on average assets % 2.5 1.5 1.5
Loan to deposit ratio % 66.7 79.5 72.4
Net interest margin % 5.5 4.7 5.1
Non-performing loan to total loan % 4.8 4.6 4.4
Non-interest revenue to total income % 40.5 46.4 43.2
Credit impairment charges Nmillion >100 1,438 2,368 2,667
Credit loss ratio % 0.8 1.6 0.9
Cost-to-income ratio % 65.9 71.7 80.2
Tier 1 capital adequacy % 12.0 13.1 16.6
Total capital adequacy % 13.5 15.4 18.3
Effective taxation rate % 8.8 16.3 6.9
Banking activitiesBusiness unit contribution to profit before tax
7
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Market and Shareholderinformation
Otherinformation
Group resultsin brief
6 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Group results in brief
In 1H 2014, the group experienced:
Globally
World economy continues to recover gradually despite the contraction in economic activities experienced in the US and some developed countries in the first quarter of the year due to severe winter weather. The global GDP growth in 2014 is now forecast at 3.1% slightly higher than the estimated 2.9% for 2013.
The Eurozone is improving slowly following the further stimulus package introduced by the European Central Bank including a Targeted Long Term Refinancing Operation (TLTRO) of up to €400 billion, which provides additional monetary supply until 2018.
Improved growth momentum experienced by China albeit slower than expected leading to a slight downward revision in GDP growth from 7.5% to 7.4%.
Africa remains a major investment focus region for developed countries, with East and West African countries recording GDP growth of around 6%. Growth in sub-Saharan Africa is projected to be at 5.8% in 2014. Excluding South Africa, the figure is forecast at 6.8%.
Nigeria
Inflation remained contained at single digit through the first half of 2014, averaging 8.0%.
The exchange rate was under significant pressure in the first quarter of 2014, causing a spike to about N165/USD1 due to huge outflow of funds from the economy by foreign investors. This however, stabilised around N162/USD1 in 2Q 2014.
The capital market experienced slow growth in its performance in 1H 2014 as investors’ reacted to the uncertainties around the financial system in 1Q 2014.
The central bank further tightened the monetary policy measure by increasing the cash reserve requirement on private sector deposits to 15% from 12%.
Share price performance (Jan-June 2014):
Stanbic Share price NSE All Share index Banking Index
0
0.2
0.6
0.4
1.0
0.8
1.4
1.2
02/01/2014
15/01/2014
28/01/2014
10/02/2014
23/02/2014
08/03/2014
21/03/2014
03/04/2014
16/04/2014
29/04/2014
12/05/2014
25/05/2014
07/06/2014
20/06/2014
Financial results, ratios and statistics (continued) Economic and capital market statistics
Change % 1H 2014 1H 2013 FY 2013
Economic indicators
Headline inflation (average) % 8.0 8.4 8.5
External reserves USDbillion (22) 37.5 48.0 43.6
Average official exchange rate N/USD (5) 162.9 155.3 159.2
Market Indicators
NSE All Share Index 17 42,482.5 36,164.3 41,329.2
NSE turnover Nbillion (2) 579.2 591.6 1,025.5
Average daily activity million (10) 426.8 474.3 426.2
Aggregate market capitalisation Ntrillion 21 19.1 15.8 19.1
Equity market capitalisation Ntrillion 23 14.0 11.4 13.2
Stanbic share statistics
Share price
High for the period kobo 53 2,681 1,751 2,135
Low for the period kobo 73 1,900 1,100 1,100
Closing kobo 68 2,600 1,550 2,135
Shares traded
Number of shares traded thousands (42) 180,457 310,970 527,801
Value of shares traded Nmillion (7) 3,993 4,285 8,217
Market capitalisation Nbillion 68 260.0 155.0 213.5
Stanbic’s share price outperformed both the NSE All share Index (NSE ASI) and the Banking Index (BI) in 1H 2014. The group’s share price appreciated by 21.8%, NSE ASI by appreciated by 2.8%, while BI depreciated by 3.3% at the end of first half of 2014.
9
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Market and Shareholderinformation
Otherinformation
Group resultsin brief
8 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Group results in brief
Half year performance
Operating environment
The operating environment in the first half of 2014 witnessed further margin compression as the central bank implemented tightening measures by increasing the cash reserve ratio (CRR) on private sector deposits to 15% from 12%, while maintaining CRR on public sector deposit at 75%. The monetary policy rate was maintained at 12%. The capital market started 2014 on a bearish trend after an impressive performance in 2013. The NSE ASI appreciated by 2.8% in 1H 2014 as the market responded negatively to the suspension of the Central bank governor in 1Q 2014. The appointment and subsequent resumption of a new governor in 2Q 2014 saw a gradual return of investors’ confidence. The operating environment also witnessed sustained single digit inflation rate, relatively stable exchange rate supported by the central bank, good yields on investment securities and competition for good quality corporate credits
Notwithstanding these challenges, the group’s financial results continued to show significant growth in revenues and profitability supported by increased clients transaction volumes and activities, improved cost of funding and operational efficiency, steady growth in loan and deposit books and a well positioned trading book taking advantage of favourable market conditions.
Income statement analysisGross earnings increased by 13% to N61.5 billion in 1H 2014, on the back of a 12% growth in interest income and 25% growth in net fees and commissions revenue. Interest income increased to N34.0 billion (1H 2014: N30.4 billion), driven by a sustained growth in loans and advances and good yield on investment securities. Interest expense declined by 11% to N11.0 billion, despite a 23% growth in deposits from customers, reflecting an improvement in the deposit mix. Consequently, net interest income grew by 28% to N23.0 billion, impacting positively on net interest margin which increased to 5.6% from 4.9% in 1H 2013.
Non-interest revenue was up by 13% to N27.3 billion (H1 2013: N24.1 billion), supported by 25% growth in net fees and commission revenue, while trading revenue declined by 6%. Net fees and commission revenue was up from N15.0 billion in 1H 2013 to N18.8 billion, occasioned by increased transactional volumes and activities, as a result of our expanded delivery channels, excellent customer service and steady growth within our wealth business.
The growth in non-interest revenue was however muted by the decline in trading revenue, due to relatively stable foreign exchange market.
Operating expenses grew by 10% to N29.2 billion in 1H 2014 driven by 9% and 11% growth in staff costs and other operating expenses respectively. Staff costs increased in line with inflation as salaries were adjusted for inflation, while growth in other operating expenses was driven majorly by deposit insurance expenses to secure customer deposits with NDIC, contribution to AMCON sinking fund, increase in information technology spend to improve efficiency and better customer experience and increase in marketing and advertising to improve brand awareness. Despite the increase in operating expenses, the cost-to-income ratio improved to 58.1% from 63.2% recorded in 1H 2013.
Credit impairment charges declined by 39% to N1.4 billion, (1H 2013: N2.4 billion), as we continue to improve on the management of our risk assets benefitting from recoveries on previously written off loans and resolution of loans previously classified in the Personal & Business Banking (PBB) business segment.
Overall, profit before tax grew by 50% to N19.6 billion and profit after tax also grew by 56% to N15.9 billion.
Balance sheet analysisThe group’s balance sheet grew by 19% to close at N906.8 billion at the end of H1 2014 (FY 2013: N763.0 billion). Gross loans and advances grew by 18% to N356.9 billion in the first six months of 2014, from N303.3 billion recorded at end of 4Q 2013. The growth in loans and advances is driven by our continued focus on growing our SME and commercial clients in the PBB business segment and on growth in Oil & gas and Power sectors in our CIB segment. We will continue to grow our loan book responsibly by focusing on the right type of customers supported by our growing customer relationships and enhanced by our enlarged delivery channels.
Non-performing loans (NPLs) closed at N17.2 billion at the end of 1H 2014 (FY 2013: N13.4 billion) and represented 4.8% (FY 2013: 4.4%) of total loans. The increase in NPLs is due to a newly classified loan in the Corporate and Investment Banking business segment in response to the trading environment. Coverage ratio in respect of non-performing loans was 86% as at end 1H 2014 (FY 2013: 101%).
Deposit from customers in the 1H 2014 increased by 23% to close at N511.8 billion, from N416.4 billion recorded in FY 2013. The increase in deposit book is on the back of the increased customer base supported by our enlarged delivery channels, increased bouquet of products and efficient service delivery. The ratio of lower priced deposits to total deposits improved to 61% in 1H 2014 from 52% recorded in FY 2013 as a result of our continued efforts at reducing the cost of funds and improving on margins. The deposit from customers contributed 64% of the total liabilities and funded 57% of total assets in 1H 2014.
We are committed to leveraging our expanded delivery channels, our brand and service excellence to increase our share of low cost deposits.
Capital adequacyThe group continued to maintain a healthy capital base as capitalisation ratios remain at strong levels and are above the regulatory requirement. The group’s capital is adequate to support our planned growth opportunities within Nigeria as well as business risks and contingencies.
Group Bank
1H 2014Nmillion
FY 2013Nmillion
1H 2014Nmillion
FY 2013Nmillion
Tier I capital 86,335 86,376 56,328 63,130
Tier II capital 10,064 9,941 7,086 6,408
Total qualifying capital 96,399 96,317 63,414 69,538
Risk weighted assets 486,271 392,888 468,942 380,437
Capital adequacy
Tier I 17.8% 22.0% 12.0% 16.6%
Tier II 2.1% 2.5% 1.5% 1.7%
Total 19.8% 24.5% 13.5% 18.3%
The group’s tier 1 capital adequacy ratio stood at 17.8% (Bank 12.0%), while the total capital adequacy ratio was 19.8% (Bank 13.5%). These ratios are well above the 10% minimum statutory requirement.
The group plans to raise up to N30 billion in corporate bonds in 2H 2014 to support its business growth and expansion.
0
2,000
4,000
6,000
8,000
10,000
12,000
16,000
14,000
Profit after tax 1H 2013
PBB profit after tax growth
CIB profit after tax growth
Wealth profit after tax growth
Profit after tax 1H 2014
10,185
3,748 6781,284 15,896
Contribution to Profit after tax
11
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Market and Shareholderinformation
Otherinformation
Group resultsin brief
10 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Group results in brief
Summarised income statement
Group Bank
Change%
1H 2014Nmillion
1H 2013Nmillion
FY 2013Nmillion
Change%
1H 2014Nmillion
1H 2013Nmillion
FY 2013Nmillion
Gross earnings 13 61,478 54,509 111,226 8 47,669 44,132 87,350
Net interest income 28 22,997 17,937 37,013 28 21,659 16,876 34,802
Interest income 12 34,017 30,382 62,585 11 32,741 29,456 60,529
Interest expense 11 (11,020) (12,445) (25,572) 12 (11,082) (12,580) (25,727)
Non-interest revenue 13 27,260 24,068 48,219 1 14,727 14,617 26,426
Net fees and commission revenue
25 18,764 14,981 32,900 14 6,536 5,731 11,688
Fees and commission revenue
26 18,965 15,040 33,322 16 6,737 5,790 12,083
Fees and commission expense
(>100) (201) (59) (422) (>100) (201) (59) (395)
Trading revenue (6) 8,315 8,811 14,895 (8) 8,086 8,778 14,603
Other revenue (34) 181 276 424 (3) 105 108 135
Total income 20 50,257 42,005 85,232 16 36,386 31,493 61,228
Credit impairment charges 39 (1,438) (2,368) (2,667) 39 (1,438) (2,368) (2,667)
Income after credit impairment charges
23 48,819 39,637 82,565 20 34,948 29,125 58,561
Operating expenses (10) (29,202) (26,543) (57,948) (6) (23,964) (22,606) (49,087)
Staff costs (9) (12,839) (11,797) (23,851) (7) (10,248) (9,619) (19,218)
Other operating expenses (11) (16,363) (14,746) (34,097) (6) (13,716) (12,987) (29,869)
Profit before taxation 50 19,617 13,094 24,617 68 10,984 6,519 9,474
Direct taxation (28) (3,722) (2,909) (3,844) 7 (969) (1,039) 655
Profit for the period 56 15,895 10,185 20,773 83 10,015 5,480 10,129
Profit attributable to:
Non-controlling interests 40 1,295 927 2,163 - - - -
Equity holders of the parent 58 14,600 9,258 18,610 83 10,015 5,480 10,129
Profit for the period 56 15,895 10,185 20,773 83 10,015 5,480 10,129
Group Bank
1H 2014Nmillion
1H 2013Nmillion
FY 2013Nmillion
1H 2014Nmillion
1H 2013Nmillion
FY 2013Nmillion
Profit for the period 15,895 10,185 20,773 10,015 5,480 10,129
Other comprehensive income
Items that will never be reclassified to profit or loss - - - - -
Items that are or may be reclassified subsequently to profit or loss:
Net change in fair value of available-for-sale financial assets
629 (366) 408 584 (454) 214
Realised fair value adjustments on available-for-sale financial assets reclassified to income statement
(14) (512) (153) (2) (469) (76)
Income tax on other comprehensive income - - - - - -
Other comprehensive income for the period net of tax
615 (878) 255 582 (923) 138
Total comprehensive income for the period 16,510 9,307 21,028 10,597 4,557 10,267
Total comprehensive income attributable to:
Non-controlling interests 1,312 913 2,129 - - -
Equity holders of the parent 15,198 8,394 18,899 10,597 4,557 10,267
16,510 9,307 21,028 10,597 4,557 10,267
Statement of other comprehensive income
13
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Market and Shareholderinformation
Otherinformation
Group resultsin brief
12 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Group results in brief
Group Bank
Change%
1H 2014Nmillion
FY 2013Nmillion
1H 2013Nmillion
Change%
1H 2014Nmillion
FY 2013Nmillion
1H 2013Nmillion
Assets
Cash and cash equivalents 39 167,288 120,312 38,879 37 149,618 109,385 38,879
Trading assets >100 148,080 40,711 160,871 >100 145,313 38,049 157,159
Pledged assets (5) 23,541 24,733 22,265 (5) 23,541 24,733 22,265
Derivative assets 49 2,272 1,526 2,972 49 2,272 1,526 2,972
Financial investments 12 156,666 139,304 142,522 12 138,281 123,457 128,894
Loans and advances (9) 350,994 383,927 375,188 (9) 350,994 383,927 374,200
Loans and advances to banks (91) 8,780 94,180 94,351 (91) 8,780 94,180 93,363
Loans and advances to customers 18 342,214 289,747 280,837 18 342,214 289,747 280,837
Other assets 33 26,298 19,829 47,446 47 21,540 14,634 46,297
Current and deffered tax assets 3 7,928 7,716 5,146 2 7,583 7,441 5,085
Property and equipment (5) 23,771 24,988 23,047 (6) 20,691 21,948 22,593
Total assets 19 906,838 763,046 818,336 19 859,833 725,100 798,344
Equity and liabilities
Equity 15 112,302 97,634 93,831 6 74,521 70,580 64,843
Equity attributable to ordinary shareholders
16 109,551 94,313 91,759 6 74,521 70,580 64,843
Ordinary share capital - 5,000 5,000 5,000 - 1,875 1,875 1,875
Ordinary share premium - 65,450 65,450 65,450 - 42,469 42,469 42,469
Reserves 64 39,101 23,863 21,309 15 30,177 26,236 20,499
Non-controlling interest (17) 2,751 3,321 2,072 - - - -
Liabilities 19 794,536 665,412 724,505 20 785,312 654,520 733,501
Trading liabilities 27 85,194 66,960 81,567 27 85,194 66,960 81,567
Derivative liabilities (25) 812 1,085 383 (25) 812 1,085 383
Deposit and current accounts 18 554,454 468,038 520,994 18 555,961 470,718 534,889
Deposits from banks (17) 42,691 51,686 150,974 (17) 42,691 51,686 150,974
Deposits from customers 23 511,763 416,352 370,020 22 513,270 419,032 383,915
Other borrowings 30 63,575 48,764 49,139 30 63,575 48,764 49,139
Current and deferred tax liabilities (1) 7,743 7,788 5,173 6 2,883 2,723 2,060
Subordinated debt 1 6,494 6,399 6,482 1 6,494 6,399 6,482
Provisions and other liabilities 15 76,264 66,378 60,767 22 70,393 57,871 58,981
Total equity and liabilities 19 906,838 763,046 818,336 19 859,833 725,100 798,344
Change %
2Q 2014Nmillion
1Q 2014Nmillion
1H 2014Nmillion
Gross income 3 31,257 30,221 61,478
Net interest income (4) 11,271 11,726 22,997
Interest income (0) 16,998 17,019 34,017
Interest expense (8) (5,727) (5,293) (11,020)
Non-interest revenue 8 14,175 13,085 27,260
Net fee and commission revenue 10 9,828 8,936 18,764
Fee and commission revenue 9 9,912 9,053 18,965
Fee and commission expense 28 (84) (117) (201)
Trading revenue 3 4,214 4,101 8,315
Other revenue >100 133 48 181
Total income 3 25,446 24,811 50,257
Credit impairment charges 80 (243) (1,195) (1,438)
Income after credit impairment charges 7 25,203 23,616 48,819
Operating expenses 1 (14,555) (14,647) (29,202)
Staff costs (0) (6,421) (6,418) (12,839)
Other operating expenses 1 (8,134) (8,229) (16,363)
Profit before taxation 19 10,648 8,969 19,617
Taxation 20 (1,650) (2,072) (3,722)
Profit for the period 30 8,998 6,897 15,895
Key performance indicator
Net interest margin 5.3 6.1 5.6
Non-interest revenue to total income 55.7 52.7 54.2
Credit loss ratio 0.3 1.5 0.8
Cost-to-income ratio 57.2 59.0 58.1
Return on equity 32.0 26.0 28.9
Return on assets 4.2 3.6 3.8
Non-performing loan to total loan 4.8 4.5 4.8
Summarised group income statement quarterly analysis
Statement of financial position
15
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Market and Shareholderinformation
Otherinformation
Group resultsin brief
14 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Group results in brief
Group financial position quarterly analysis
2Q 2014Nmillion
1Q 2014Nmillion
FY 2013Nmillion
Assets
Cash and cash equivalents 167,288 160,946 120,312
Trading assets 148,080 60,418 40,711
Pledged assets 23,541 24,484 24,733
Derivative assets 2,272 2,831 1,526
Financial investments 156,666 131,455 139,304
Loans and advances 350,994 374,813 383,927
Loans and advances to banks 8,780 68,158 94,180
Loans and advances to customers 342,214 306,655 289,747
Other assets 26,298 23,350 19,829
Current and deffered tax assets 7,928 7,420 7,716
Property and equipment 23,771 24,154 24,988
Total assets 906,838 809,871 763,046
Equity and liabilities
Equity 112,302 104,298 97,634
Equity attributable to ordinary shareholders 109,551 100,324 94,313
Ordinary share capital 5,000 5,000 5,000
Ordinary share premium 65,450 65,450 65,450
Reserves 39,101 29,874 23,863
Non-controlling interest 2,751 3,974 3,321
Liabilities 794,536 705,573 665,412
Trading liabilities 85,194 62,880 66,960
Derivative liabilities 812 1,011 1,085
Deposit and current accounts 554,454 510,906 468,038
Deposits from banks 42,691 58,544 51,686
Deposits from customers 511,763 452,362 416,352
Other borrowings 63,575 65,027 48,764
Current and deferred tax liabilities 7,743 8,968 7,788
Subordinated debt 6,494 6,624 6,399
Provisions and other liabilities 76,264 50,157 66,378
Total equity and liabilities 906,838 809,871 763,046
Statement of cash flows
Group Bank
1H 2014Nmillion
1H 2013Nmillion
1H 2014Nmillion
1H 2013Nmillion
Net cash flows from operating activities 50,603 43,234 45,951 52,329
Cash flows used in operations 31,440 27,899 25,303 36,009
Profit before tax 19,617 13,094 10,984 6,519
Adjusted for: (19,793) (13,714) (18,529) (12,713)
Amortisation of intangible assets - - - -
Credit impairment charges on loans and advances 1,438 2,368 1,438 2,368
Depreciation of property and equipment 1,822 1,753 1,667 1,669
Dividends included in trading revenue and investment income (68) (58) (36) (34)
Equity-settled share-based payments 40 38 19 36
Interest expense 11,020 12,445 11,082 12,580
Interest income (34,017) (30,382) (32,741) (29,456)
Loss/(profit) on sale of property and equipment (28) 122 (30) 124
Increase in income-earning assets (82,170) (116,049) (82,502) (116,057)
Increase in deposits and other liabilities 113,786 144,568 115,350 158,260
Dividends received 68 58 36 34
Interest paid (11,020) (12,445) (11,082) (12,580)
Interest received 34,017 30,382 32,741 29,456
Direct taxation paid (3,902) (2,660) (975) (590)
Net cash flows used in investing activities (17,324) (58,154) (14,622) (58,577)
Capital expenditure on
- property (26) (9) (26) (9)
- equipment, furniture and vehicles (912) (460) (711) (384)
Proceeds from sale of property, equipment, furniture and vehicles 361 5 357 4
(Purchase)/sale of financial investment securities (16,747) (57,690) (14,242) (58,188)
Net cash flows used in financing activities 12,129 (12,370) 8,136 (15,190)
Net increase/(decrease) in other borrowings 14,811 (17,734) 14,811 (17,734)
Proceed from issue subordinated debt - 6,482 - 6,482.00
Net dividends paid (1,882) (1,118) (6,675) (3,938.00)
Effect of exchange rate changes on cash and cash equivalents 768 227 768 227
Net increase in cash and cash equivalents 46,976 (27,063) 40,233 (21,211)
Cash and cash equivalents at beginning of the period 120,312 106,680 109,385 99,840
Cash and cash equivalents at end of the period 167,288 79,617 149,618 78,629
17
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Market and Shareholderinformation
Otherinformation
Group resultsin brief
16 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Group results in brief
Ordinaryshare
capitalNmillion
Share premiumNmillion
Merger reserve
Nmillion
Statutory credit risk
reserveNmillion
Available -for-sale
revaluation reserve
Nmillion
Share-based payment
reserveNmillion
Other regulatory
reservesNmillion
Retained earnings Nmillion
Ordinary shareholders’
equityNmillion
Non-controlling
interest Nmillion
Totalequity
Nmillion
Balance at 1 January 2013 5,000 65,450 (19,123) - (68) 362 16,420 15,300 83,341 2,310 85,651
Total comprehensive (loss)/income for the period - - - - (878) - 1,216 8,042 8,380 880 9,260
Profit for the period - - - - - - 1,216 8,042 9,258 927 10,185
Other comprehensive (loss)/income after tax for the period - - - - (878) - - - (878) (47) (925)
Net change in fair value on available-for-sale financial assets - - - - (366) - - - (366) (47) (413)
Realised fair value adjustments on available-for-sale financial assets - - - - (512) - - - (512) - (512)
Income tax on other comprehensive income - - - - - - - - - - -
Transactions with shareholders, recorded directly in equity - - - - - 38 - - 38 (1,118) (1,080)
Equity-settled share-based payment transactions - - - - - 38 - - 38 - 38
Dividends paid to equity holders - - - - - - - - - (1,118) (1,118)
Balance at 30 June 2013 5,000 65,450 (19,123) - (946) 400 17,636 23,342 91,759 2,072 93,831
Balance at 1 January 2014 5,000 65,450 (19,123) 769 221 273 18,859 22,864 94,313 3,321 85,651
Total comprehensive income/(loss) for the period 598 - 2,053 12,547 15,198 1,312 16,510
Profit for the period - - - - - - 2,053 12,547 14,600 1,295 15,895
Other comprehensive income/(loss) after tax for the period - - - - 598 - - - 598 17 615
Net change in fair value on available-for-sale financial assets - - - - 612 - - - 612 17 629
Realised fair value adjustments on available-for-sale financial assets - - - - (14) - - - (14) - (14)
Income tax on other comprehensive income - - - - - - - - - - -
Statutory credit risk reserve - - - (769) - - - 769 - - -
Transactions with shareholders, recorded directly in equity - - - - - 40 - - 40 (1,882) (1,842)
Equity-settled share-based payment transactions - - - - - 40 - - 40 - 40
Dividends paid to equity holders - - - - - - - - (1,882) (1,882)
Balance at 30 June 2014 5,000 65,450 (19,123) - 819 313 20,912 36,180 109,551 2,751 100,319
Statement of changes in equity – Group
19
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Market and Shareholderinformation
Otherinformation
Group resultsin brief
18 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Group results in brief
Ordinary share capital
Nmillion
Share premiumNmillion
Statutory credit risk
reserveNmillion
Available -for-sale
revaluation reserve
Nmillion
Share-based payment
reserveNmillion
SMIEISreservesNmillion
Statutory reservesNmillion
Retained earnings Nmillion
Ordinary shareholders’
equityNmillion
Balance at 1 January 2013 1,875 42,469 - (129) 362 1,039 13,648 4,924 64,188
Total comprehensive (loss)/income for the period - - - (923) - - 822 4,658 4,557
Profit for the period - - - - - - 822 4,658 5,480
Other comprehensive (loss)/income after tax for the period - - - (923) - - - - (923)
Net change in fair value on available-for-sale financial assets - - - (454) - - - - (454)
Realised fair value adjustments on available-for-sale financial assets - - - (469) - - - - (469)
Transactions with shareholders, recorded directly in equity - - - - 36 - - (3,938) (3,902)
Equity-settled share-based payment transactions - - - - 36 - - - 36
Dividends paid to equity holders - - - - - - - (3,938) (3,938)
Balance at 30 June 2013 1,875 42,469 - (1,052) 398 1,039 14,470 5,644 64,843
Balance at 1 January 2014 1,875 42,469 769 9 266 1,039 15,167 8,986 70,580
Total comprehensive (loss)/income for the period - - - 582 - - 1 502 8,513 10,597
Profit for the period - - - - - - 1,502 8,513 10,015
Other comprehensive (loss)/income after tax for the period - - - 582 - - - - 582
Net change in fair value on available-for-sale financial assets - - - 584 - - - - 584
Realised fair value adjustments on available-for-sale financial assets - - - (2) - - - - (2)
Statutory credit risk reserve - - (769) - - - - 769 -
Transactions with shareholders, recorded directly in equity - - - - 19 - - (6,675) (6,656)
Equity-settled share-based payment transactions - - - - 19 - - - 19
Dividends paid to equity holders - - - - - - - (6,675) (6,675)
Balance at 30 June 2014 1,875 42,469 - 591 285 1,039 16,669 11,593 74,521
Statement of changes in equity – Bank
20 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Business unit review
21
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Business unitreview
Market and Shareholderinformation
Business unit reviewSegmental structure for key business units
Segmental income statement
Personal & Business Banking
Corporate & Investment Banking
Wealth
21
23
24
30
35
Businessunit review
Segmental structure for key business units
Stanbic IBTC Group
Personal & Business Banking
Banking and other financial services to individual customers and small-to-medium-sized enterprises.
Corporate & Investment Banking Corporate investment banking services to larger corporates, financial institutions and international counterparties.
Wealth
Investment management in form of non-pension asset management, pension asset management and trusteeship and estate management.
What we offer:Pension fund administration Retirement savings accounts. Gratuity schemes for companies.
Asset management Mutual funds. Portfolio management for
High Net worth individuals.
Trustee services Private trust. Corporate trust.
What we offer:Mortgage lending Residential accomodation loans
to mainly personal market customers.
Instalment sale and finance leases Finance of vehicles for
personal market customers. Finance of vehicles and
equipment in the business market.
Card Products Credit card facilities to
individuals and businesses (Credit card issuing).
Merchant transaction acquiring services (card acquiring).
Transactional products Comprehensive suite of
transactional, savings and investment products. This includes deposit taking activities, electronic banking and debit card facilities.
Lending products Lending products offered to
both personal and business markets.
Bancassurance Short to long term insurance
products to clients through third parties, and financial planning services to clients.
What we offer:Global markets Fixed income and currencies. Commodities. Equities.
Investment banking Advisory. Debt products. Structured finance. Equity capital markets. Debt capital markets. Structured trade and
equity finance.
Transactional products and services Investor services. Transactional banking. Trade finance.
Real estate and principal investment management Real estate finance. Investment in real estate. Principal investment
management.
Coverage and distribution Client facing sales activities
within CIB division.
22 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Business unit review
23
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Business unitreview
Market and Shareholderinformation
1H 2014 1H 2013
Total income N15.2 billion N11.6 billion
Total income increase 32% increase 8%
Total income contribution (%) 30.3 27.5
Cost-to-income ratio (%) 95.9 121.8
Credit loss ratio (%) 1.7 2.9
Loan growth (%) 15.2 6.0
Deposit growth (%) 1.1 10.0
1H 2014 1H 2013
Total income N24.3 billion N22.2 billion
Total income increase 9% increase 58%
Total income contribution (%) 48.3 53.0
Cost-to-income ratio (%) 45.0 42.7
Credit loss ratio (%) 0.1 0.8
Loan growth (%) 19.6 5.0
Deposit growth (%) 42.7 (1.0)
1H 2014 1H 2013
Total income N10.7 billion N8.2 billion
Total income increase 31% increase 30%
Total income contribution (%) 21.4 19.5
Cost-to-income ratio (%) 34.2 35.8
Assets under management increase 9% increase 14%
Retirement savings accounts increase 7% increase 9%
Personal & Business Banking% of group gross income
Wealth% of group gross income
30%
Corporate & Investment Banking% of group gross income
49%
21%
Segmental structure for key business units (continued)
Personal & Business Banking
Corporate & Investment Banking
Wealth
Change%
1H 2014Nmillion
1H 2013Nmillion
Change%
1H 2014Nmillion
1H 2013Nmillion
Change%
1H 2014Nmillion
1H 2013Nmillion
Gross income 14 17,836 15,653 7 32,894 30,664 31 10,748 8,192
Interest income 11 13,650 12,315 12 19,356 17,243 5 1,011 959
Interest expense 36 (2,615) (4,086) (4) (8,404) (8,494) - - -
Net interest income 34 11,035 8,229 25 10,952 8,749 5 1,011 959
Non-interest revenue 25 4,186 3,338 (1) 13,337 13,497 35 9,736 7,233
Net fee and commission revenue 28 4,125 3,214 8
4,916 4,545 35 9,722 7,222
Trading revenue - - - (6) 8,315 8,811 - - -
Other revenue (51) 61 124 (25) 106 141 33 15 11
Total income 32 15,221 11,567 9 24,289 22,246 31 10,748 8,192
Credit impairment charges 16
(1,340)
(1,603) 87 (98) (765) - - -
Income after credit impairment charges
39 13,880 9,964 11 24,191 21,824 31 10,748 8,192
Operating expenses (3) (14,594) (14,106) (15) (10,934) (9,504) (25) (3,674) (2,933)
Staff costs (3) (7,309) (7,120) (21) (3,970) (3,287) (12) (1,560) (1,390)
Other operating expenses (4)
(7,285)
(6,986) (12)
(6,964)
(6,217) (37) (2,114)
(1,543)
(Loss)/Profit before tax 83
(714) (4,142) 11
13,257 11,977 35
7,074
5,259
Tax 74 751 (431) 36 (2,293) (1,691) (32) (2,180) (1,649)
Profit after tax >(100) 37 (3,711) 7 10,964 10,286 36 4,894 3,610
Segmental income statement
0
30,000
25,000
20,000
15,000
10,000
5,000
35,000
40,000
45,000
55,000
50,000
Total income 1H 2013
PBB total income growth
CIB total income growth
Wealth total income growth
Total income 1H 2014
42,005
3,6542,043 2,556 50,258
Contribution to total income
24 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Business unit review
25
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Business unitreview
Market and Shareholderinformation
Personal and Business Banking (PBB) is the retail arm of group’s business. PBB provides services to customers in personal markets, high networth individuals (HNIs) and the commercial, small and medium scale enterprises (SME) business segments. It services customers by providing financial solutions through products and services available on various channels and platforms with a nationwide network of branches, ATMs and bank agents.
The focus of PBB is to provide appropriate, affordable, convenient and accessible financial solutions to customers, through passionate and customer focused employees nationwide. It offers the following products; vehicle and asset finance, unsecured and secured personal and business loans, mortgage loans, a range of trade finance products and various current, savings and investment offerings.
PBB is divided into three business lines for efficient service delivery. The business lines are Personal Banking, Business Banking and Public sector. Personal Banking focuses on banking services to individuals through lifecycle management. The personal banking business meets individual needs as these needs change and cuts across the various segments through to High networth Individuals. Business Banking focuses on two segments - small and medium scale enterprises and commercial, providing them business solutions to support their growing business needs, while Public sector focuses on managing the Group’s relationship with government agencies, ministries and departments.
Financial performancePBB’s gross income increased by 14% to N17.8 billion benefitting from growth in interest income and non-interest revenue. Interest income grew by 11% to N13.7 billion, on the back of a growing loan book supported by increasing number of customers and ability to offer loan products at market rates. Interest expense declined 36% to N2.6 billion.The decline in interest expense is as a result of improvement in PBB’s deposit mix, despite the increase in customer deposits. This positively impacted the net interest income which increased 34% to N11.0 billion.
PBB’s non-interest revenue, comprised primarily net fees and commission income, grew by 25% to N4.2 billion (1H 2013: N3.3 billion) despite the regulatory induced
Personal and Business Banking (PBB)
reduction in transactions fees. The growth in net fee and commission revenue was driven by increased transactional volumes and activities supported by increase in the number of customers. The key contribution to fees and commission are; card transaction fees a function of high ATM uptime, foreign exchange transaction fees and documentary and administrative fees from loans and advances. Total income grew 32% to N15.2 billion on the back of the growth recorded in net interest income and non-interest revenue.
Credit impairment charges declined by 16%, benefitting from better management of the loan book and recoveries made from previously classified loans.
PBB’s operating expenses was up by 3%, due to an increase of 3% and 4% in staff costs and other operating costs respectively. The unit continues to focus on more efficient processes to deliver bespoke services to its customers. The unit recorded a loss before tax of N714 million and profit after tax of N37 million, while its cost-to-income ratio improved to 95.9% from 121.8% in 1H 2013.
PBB gross loans and advances increased by 15% to close 1H 2014 at N153.8 billion (FY 2013: N133.6 billion). When compared to 1H 2013, the loan book increased by 38%. The growth in PBB’s loan book is a testament to the unit’s continued focus to grow the business responsibly by increasing its market share among existing customers, while acquiring new customers. Non-performing loans increased by 7% to N10.7 billion from N9.9 billion recorded in FY 2013. This is a result of our conservative risk management process which led to the classification of some loans during the 1H 2014. Despite the increase in non-performing loans, the ratio of non-performing loans to total loans improved to 6.9% from 7.5% recorded in FY 2013.
Deposit from customers closed at N200.1 billion at the end of the first six months of 2014. This represents a marginal increase of 1% over N197.9 billion recorded in FY 2013 and 11% growth over N180.6 billion achieved in 1H 2013. The continued growth in number of customers supported the growth in deposits, as PBB continues to provide various channels to ensure safe and easy banking services to our customers.
Total operating incomeCAGR (1H 2011-1H 2014): 24%
1H 2011 1H 2012 1H 2013 1H 20140
12,000
14,000
10,000
8,000
6,000
4,000
2,000
16,000 15,221
11,56710,692
8,000
Nmillion
10Net interest income and non-interest revenueCAGR (1H 2011-1H 2014): Net interest income: 22%
Non-interest revenue: 29%
Net interest income Non-interest revenue
1H 2011 1H 2012 1H 2013 1H 20140
8,000
10,000
6,000
4,000
2,000
12,000
Nmillion
6,054
1,946
8,227
2,465
8,229
3,338
11,035
4,186
5
Performance highlights
Change % 1H 2014 1H 2013 FY 2013
Net interest income Nmillion 34 11,035 8,229 18,443
Non-interest revenue Nmillion 25 4,186 3,338 6,909
Credit impairment charges Nmillion 16 (1,340) (1,603) (2,344)
Operating expenses Nmillion (3) (14,594) (14,106) (30,703)
Loss before tax Nmillion 83 (714) (4,142) (7,696)
Gross loans & advances Nmillion 15 153,828 111,734 133,550
Deposit liabilities Nmillion 1 200,106 180,578 197,898
Cost-to-income % 95.9 121.8 121.1
Non-interest revenue to total income % 27.5 28.9 27.3
Credit loss ratio % 1.7 2.9 1.8
Loan to deposit % 76.9 61.9 67.5
Non-performing loans to total loans & advances % 6.9 7.8 7.5
Other key business statistics
Business infrastructure
Branch network Number 1 180 179 180
ATMs Number 35 372 276 359
26 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Business unit review
27
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Business unitreview
Market and Shareholderinformation
Quarterly analysis of performance
Change % 2Q 2014 1Q 2014 1H 2014
Net interest income Nmillion (4) 5,418 5,616 11,035
Non-interest revenue Nmillion 7 2,166 2,020 4,186
Credit impairment charges Nmillion 49 (452) (889) (1,340)
Operating expenses Nmillion (3) (7,415) (7,179) (14,594)
Loss before tax Nmillion 35 (282) (431) (714)
Net loans and advances Nmillion 11 144,451 129,613 144,451
Deposit liabilities Nmillion 2 200,106 195,944 200,106
Cost-to-income % 97.8 94.0 95.9
Non-interest revenue to total income % 28.6 26.5 27.5
Credit loss ratio % 1.2 2.6 1.7
Non-performing loans to total loans & advances % 6.9 7.8 6.9
Other key business statistics
Business infrastructure
Branch network Number 0 180 180 180
ATMs Number 11 372 361 372
Personal and Business Banking (continued)
1H 2014 1H 2013
Business banking 47%
Personalbanking
53%
Operating income by business unit
Factors impacting the results
Favourable
Net fees and commissions income grew on the back of an increase in transactional volumes and activities.
Deposit mix improved to 59% (1H 2013: 54%) despite a marginal growth in deposit book.
Decline in cost of funding, growth in loan book and ability to re-price loans at market rate contributed to growth in net interest income.
Impairment charges declined due to the resolution of some loans previously classified.
Adverse
Growth in net fees and commission was negatively impacted by regulation that reduced transaction fees.
Business banking 46%
Personalbanking
54%
28 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Business unit review
29
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Business unitreview
Market and Shareholderinformation
Loans & advances
Breakdown of loans and advances to customers Change%
1H 2014Nmillion
FY 2013Nmillion
1H 2013Nmillion
Gross loans and advances 15 153,828 133,550 111,734
Mortgage (11) 7,704 8,667 8,824
Instalment sale and finance leases 7 19,420 18,084 17,581
Overdrafts 26 23,335 18,577 13,754
Term loans 17 103,369 88,223 71,575
Provisions (9) (9,377) (8,608) (7,828)
Specific credit impairment (6) (7,267) (6,879) (6,286)
Portfolio credit impairment (22) (2,110) (1,729) (1,542)
Net loans and advances 16 144,451 124,942 103,906
Breakdown of non-performing loans Change%
1H 2014Nmillion
FY 2013Nmillion
1H 2013Nmillion
Overdrafts (40) 1,409 1,005 993
Term loans 1 6,340 6,377 4,986
Instalment sale and finance leases (7) 2,348 2,195 1,952
Mortgage loans 34 559 418 764
Total (7) 10,656 9,995 8,695
Mortgage lending
Decline in loan book as a result of limited appetite by customers due to high interest rates.
Deterioration in the mortgage asset book as non-performing mortgage loans to total mortgage loans worsened to 7.3% from 4.8% in FY 2013, due to persistent high interest rate environment.
Instalment sale and finance leases Vehicle sales have continued to increase as more customers take advantage of this product to acquire new vehicles, resulting
in growth in interest income.
Stanbic IBTC Bank won “Bank of the Year” on wheels annual award for the 3rd consecutive year during the Nigerian Auto Award 2013, to further confirm its market leadership in vehicle and assets finance business.
The non-performing ratio in instalment sale and finance leases remained flat at 12.1% from FY 2013 despite a 7% growth in the product loan book and non-performing loans.
Personal and Business Banking (continued)
Transactional and lending products
Non-interest revenue grew as a result of increased transactional volumes and activities on the back of continued growth in customer numbers.
Overdraft and term loan books grew as a result of a continued focus on supporting commercial and SME businesses to meet their working capital requirements and aid their expansion.
The ratio of non-performing loans to total loans improved to 6.1% (FY 2013: 6.9%) despite an increase in overdraft and term loans.
Deposit mix improved to 59% (1H 2013: 54%) despite a marginal growth of 1% in deposit book.
Marginal increase in customer deposits due to a one-off reduction in public sector deposits.
Continued focus on service excellence and customer engagement to attract and retain potential and existing customer.
We will continue to focus on increasing customer numbers and deposits by leveraging on our expanded delivery channels.
Change%
1H 2014Nmillion
FY 2013Nmillion
1H 2013Nmillion
Current accounts (1) 97,747 80,964 98,550
Savings deposits 2 19,469 16,948 19,097
Call deposits (27) 6,437 5,213 8,863
Term deposits 7 76,452 77,453 71,388
Total deposits and current accounts 1 200,106 180,578 197,898
Deposit liabilities
30 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Business unit review
31
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Business unitreview
Market and Shareholderinformation
Corporate and Investment Banking (CIB)Corporate and Investment Banking provides wholesale banking services to large local and multinational corporates, institutional and public sector clients in strategic sectors of the economy. CIB offers financial solutions, which includes debt and equity advisory, structured and project finance, trade services, transactional banking and lending, global markets, custody and stockbroking. The unit has four distinct business sub-units through which it delivers client focused financial solutions. The sub-units are Investment banking, Globalmarkets, Transactional products and services and Client coverage.
Investment Banking provides financial advisory, tailored structuring and funding solutions, which include debt and equity capital offerings. The Global Markets deals in equities, fixed income, foreign exchange, money market and other hedging products to satisfy client requirements. Transactional product and services offers standardised or tailored transactional products and services including cash management, trade finance and custody solutions. The client coverage team manages the corporate relationships with our clients.
Financial performanceCIB’s gross revenue increased by 7% to N32.9 billion (1H 2013: N30.7 billion), on the back of a 25% growth in net interest income and 8% growth in net fees and commissions revenue. Interest income grew by 13% to N19.4 billion supported by improved yields in investment securities and a growing loan book. Interest expense remained flat at N8.4 billion in 1H 2014 despite 43% increase in customer deposits. Consequently, net interest income increased by 25% to N11.0 billion. The benefits of our conscious effort to exit matured expensive term deposits and replace them with lower priced deposits is evidenced by the reducing cost of funds and improvement in the deposit mix.
Non-interest revenue declined marginally by 1% to N13.3 billion, as a result of 8% growth in net fees and commissions revenue to N4.9 billion (1H 2013: N4.5 billion), while trading revenue declined by 6% to N8.3 billion. The growth in net fees and commission revenue is as a result of increase in client transactional volumes and activities and closure of good advisory mandates in investment banking business. Total income increased by 9% to N24.3 billion.
Operating expenses increased by 15% to N10.9 billion, on the back of 21% growth in staff cost and 12% growth in other operating expenses. Cost-to-income ratio however declined to 45.0% from 42.7% recorded in 1H 2013. Profit before tax and profit after tax grew by 11% and 7% respectively, to close at N13.3 billion and N11.0 billion.
The unit’s gross loans and advances closed the first six months of 2014 at N203.1 billion, this represents a 20% growth over N169.8 billion recorded in FY 2013 and 11% increase over N183.4 billion in 1H 2013. The growth in gross loans and advances is supported by term loans to the oil and gas and construction sector. The unit’s non-performing loans increased to N6.5 billion due to a newly classified loan due to our conservative risk management procedures. Expectedly, non-performing loans to total loans ratio deteriorated to 3.2% from 2.0% in FY 2013.
Deposit liabilities increased by 43% to N311.7 billion from N218.5 billion in FY 2013. The increase is supported by growing customer relationships and increase in share of clients’ business. Our investment in information technology solutions to serve our customers better is beginning to yield positive results as we provide convenient banking services to our corporate clients.
Total operating incomeCAGR (1H 2011-1H 2014): 16%
Net interest income and non-interest revenue CAGR (1H 2011-1H 2014): Net interest income: 14%
Non-interest revenue: 19%
1H 2011 1H 2012 1H 2013 1H20140
12,000
14,000
10,000
8,000
6,000
4,000
2,000
16,000
Nmillion
7,448 7,920 8,278
5,773
8,749
13,497 13,337
5
10,952
Net interest income Non-interest revenue
Performance highlightsChange % 1H 2014 1H 2013 FY 2013
Net interest income Nmillion 25 10,952 8,749 16,622
Non-interest revenue Nmillion (1) 13,337 13,497 24,599
Credit impairment charges Nmillion 87 (98) (765) (323)
Operating expenses Nmillion (15) (10,934) (9,504) (20,844)
Profit before tax Nmillion 11 13,257 11,977 20,054
Gross loans & advances Nmillion 20 203,082 183,391 169,756
Deposit liabilities Nmillion 43 311,657 189,442 218,454
Cost-to-income % 45.0 43.6 50.6
Non-interest revenue to total income % 54.9 60.7 59.7
Credit loss ratio % 0.1 0.8 0.2
Loan to deposit % 65.2 96.8 77.7
Non-performing loans to total loans & advances % 3.2 2.6 2.0
Other key business statistics
Investor services
Assets under custody Nbillion (18) 2,815 2,739 2,887
1H 2011 1H 2012 1H 2013 1H 20140
20,000
25,000
15,000
10,000
5,000
30,000
15,368 14,051
22,246
24,289
10
32 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Business unit review
33
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Business unitreview
Market and Shareholderinformation
Quarterly analysis of performance
Change % 2Q 2014 1Q 2014 1H 2014
Net interest income Nmillion 5 5,602 5,350 10,952
Non-interest revenue Nmillion (3) 6,555 6,782 13,337
Credit impairment charges Nmillion >100 209 (306) (98)
Operating expenses Nmillion 7 (5,190) (5,744) (10,934)
Profit before tax Nmillion 18 7,186 6,071 13,257
Net loans and advances Nmillion 12 197,762 177,042 197,762
Deposit liabilities Nmillion 49 311,657 208,509 311,657
Cost-to-income % 42.7 47.3 45.0
Non-interest revenue to total income % 53.9 55.9 54.9
Credit loss ratio % (0.4) 0.7 0.1
Non-performing loans to total loans & advances % 3.2 1.9 3.2
Other key business statistics
Investor services
Assets under custody Nbillion (20) 2,815 2,243 2,815
Corporate and Investment Banking (continued)
1H 20131H 2014
Total operating income by business segment
Investment banking 20%
Global markets 41%
Transactional products and services
39%
Investment banking 23%
Global markets 38%
Transactional products and services
39%
Factors impacting the results
Favourable
Net interest income growth was supported by decline in cost of funding and growth in loan book.
Growth in income from investments due to good yields.
Revenue growth from investment banking business on the back of execution of good deals including a landmark transaction.
Increase in net fees and commissions revenue due to a growth in transaction volumes and activities.
Adverse
Slow growth in capital market performance, due to the market’s reaction to uncertainties in the financial system in 1Q 2014, impacted negatively on revenue from stockbroking business.
The stiff competition for good quality corporate credits impacted negatively on our ability to re-price our corporate loan book in line with market realities.
Global markets
Interest income from interbank placements benefitted from the fluctuations in interbank deposit rates as Stanbic IBTC remained a net placer of funds in the market.
Revenue from foreign exchange trading increased as a result of growth in volume of client transactions and our ability to take advantage of the volatility in the foreign exchange market.
The capital market witnessed a slow growth in 1H 2014, resulting in a negative impact on revenue from stockbroking business.
Investment banking
Non-interest revenue growth was supported by the execution of good deals, in the oil and gas sector, from a strong deal pipeline.
Term loans book deteriorated in quality due to the classification a new non-performing loan in 2Q 2014.
Transactional products and services
Net interest income growth was on the back of decline in cost of funds resulting from a significant growth in current account balances.
Decline in custody fees due to slow growth in capital market performance.
34 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Business unit review
35
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Business unitreview
Market and Shareholderinformation
Corporate and Investment Banking (continued)
Loans & advances
Breakdown of loans and advances to customers Change%
1H 2014Nmillion
FY 2013Nmillion
1H 2013Nmillion
Gross loans and advances 20 203,082 169,756 183,391
Instalment sale and finance lease (15) 7,942 9,303 11,431
Overdrafts 25 18,742 14,949 20,741
Term loans 21 176,398 145,504 151,219
Provisions (7) (5,320) (4,952) (6,350)
Specific credit impairments (57) (3,288) (2,094) (3,557)
Portfolio credit impairments 29 (2,032) (2,858) (2,793)
Net loans and advances 20 197,762 164,804 177,041
Breakdown of non-performing loans Change%
1H 2014Nmillion
FY 2013Nmillion
1H 2013Nmillion
Overdrafts 9 190 174 154
Term loans >100 6,024 2,958 4,380
Instalment sale and finance leases 1 284 280 285
Total non-performing loans 90 6,498 3,412 4,819
Growth in term loans as demand for expansion funding increases in the oil and gas sector.
The manufacturing, wholesale and distributive trade sector drove the increase in overdraft facilities as the demand for trade facilities for importation continues to rise.
Strong growth in lower priced deposits as the effort to replace expensive term deposits with cheaper deposits begin to yield positive results.
Improvement in deposit mix resulting in better margins.
Lower priced deposits to total deposit ratio improved to 63%. (FY 2013: 46%)
Change%
1H 2014Nmillion
FY 2013Nmillion
1H 2013Nmillion
Current accounts 79 195,937 99,770 68,461
Call deposits (30) 30,931 44,064 27,777
Term deposits 14 84,790 74,620 93,204
Total deposits and current accounts 43 311,657 218,454 189,442
Deposit liabilities
Wealth
Wealth group focuses primarily on pension administration, private non-pension asset management as well as trusteeship and estate planning business. The pension administration is managed through Stanbic IBTC Pension Managers Limited, while the non-pension asset management is managed by Stanbic IBTC Asset Management Limited and trusteeship and estate management is managed by Stanbic IBTC Trustees Limited.
The wealth business model is primarily focused on assisting clients in investing in a variety of asset classes, including fixed income and equities markets to accumulate and preserve wealth.
The Federal Government of Nigeria recently signed into law a new pension act 2014 with the following salient points:
i. Increase in contribution rate from 15% to 18%. Employees will now contribute 8%, while employers will contribute 10%. This would lead to growth in assets under management and enhance monthly pension benefits to retirees.
ii. Pension funds have increased asset classes to invest pension contributions. Pension funds can now invest in infrastructure and real estate development in the country.
iii. The timeline to access benefits in event of loss of job has been reduced to 4 months from 6 months in the 2004 pension act.
Total operating incomeCAGR (1H 2011-1H 2014): 30%
Profit before taxCAGR (1H 2011-1H 2014): 40%
The impact of the new pension act on Stanbic IBTC Pension Managers will begin to manifest from 4Q as growth in assets under management will be expected resulting in increased revenue. Financial performanceWealth group’s gross income increased 31% to N10.7 billion from N8.2 billion achieved in 1H 2013, as a result of growth in interest income from money market investments and non-interest revenue. Non-interest revenue, comprising of fees and commissions and other income, was up by 35% to N9.7 billion, majorly from growth in pension funds under management and retirement savings accounts. Assets under management grew by 9% to close at N1.4 trillion, from N1.3 trillion at the end of FY 2013, while the number of Retirement Savings Accounts (RSAs) increased by 7% to 1,304,296 from 1,220,777 recorded in FY 2013. Total income increased by 31% to N10.7 billion.
Operating expenses increased by 25% as a result of increased spending on information technology platform to improve operational efficiency. Despite the increase in operating expenses cost-to-income ratio declined to 34.2% from 35.8% recorded in 1H 2013. Profit before tax was up by 35% to N7.1 billion, while profit after grew by 36% to N4.9 billion.
1H 2011 1H 2012 1H 2013 1H 20140
8,000
10,000
6,000
4,000
2,000
12,000
4,839
6,305
8,192
10,748
Nmillion
10
1H 2011 1H 2012 1H 2013 1H 20140
6,000
7,000
5,000
4,000
3,000
2,000
1,000
8,000
2,5723,296
5,259
7,074
Nmillion
10
36 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Business unit review
37
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Business unitreview
Market and Shareholderinformation
Change % 1H 2014 1H 2013 FY 2013
Net interest income Nmillion 5 1,011 959 1,948
Non-interest revenue Nmillion 35 9,736 7,233 16,712
Operating expenses Nmillion (25) (3,674) (2,933) (6,401)
Profit before tax Nmillion 35 7,074 5,259 12,259
Assets under management Nmillion 9 1,437,938 1,131,328 1,316,690
Retirement savings accounts Number 7 1,304,296 1,152,617 1,220,777
Cost to income ratio % 34.2 35.8 34.3
Performance highlights
Quarterly analysis performance
Change % 2Q 2014 1Q 2014 1H 2014
Net interest income Nmillion (17) 457 554 1,011
Non-interest revenue Nmillion 8 5,063 4,673 9,736
Operating expenses Nmillion 12 (1,943) (1,731) (3,674)
Profit before tax Nmillion 3 3,584 3,490 7,074
Assets under management Nmillion 7 1,437,938 1,343,020 1,437,938
Retirement savings accounts Number 2 1,304,296 1,282,440 1,304,296
Cost to income ratio % 35.2 33.1 34.2
Wealth (continued)
1H 2014 1H 2013
Asset management 10%
Pension management 90%
Trustees 0%
Operating income by business segment
Asset management 14%
Pension management 85%
Trustees1%
Assets under management
Retirement savings accountAsset management Pension management
Factors impacting the results
Favourable
Increase in net fees and commission driven by growth in pension clients and related assets under management.
Growth in interest income as a result of good yields on investment securities.
Adverse
Growth in operating expenses muted increase in profit before tax.
1H 2012 FY 2012 1H 2013 FY 2013 1H 20140 0
1,000
1,200
800
600
400
200
1,400
1,000
1,200
800
600
400
200
1,400
Nbillion NO (000)
108.9
723.8
125.0 143.1 159.0
865.9
988.2
1,157.7 1,299.6
5
138.3
38 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Income statement analysis
39
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Income statementanalysis
Market and Shareholderinformation
Income statement
analysis
Income statement analysisOverview of group income
Net interest income and margin analysis
Non-interest revenue
Impairment charges
Operating expenses
Taxation
39
41
43
45
47
49
Overview of group income
Drivers of group income
Gross revenue CAGR (1H 2011-1H 2014): 25%
0
20,000
10,000
40,000
30,000
60,000
50,000
Nmillion
Interestincome
34,017
Interestexpense
11,020
Non-interestrevenue
27,260
CreditImpairment
charges
1,438
Operatingexpenses
29,202
Profit before
taxation
19,617
Taxes
3,722
Profit after
taxation
15,895
1H 2011 1H 2012 1H 2013 1H 20140
50,000
60,000
40,000
30,000
20,000
10,000
70,000
31,247
41,898
54,509
61,478
Nmillion
10 Interest based revenue and non-interest based revenue
Interest based revenue
Non-interest based revenue
1H 2011 1H 2012 1H 2013 1H 20140
30,000
35,000
25,000
20,000
15,000
10,000
5,000
40,000
Nmillion
16,732
27,996 30,382
34,017
14,515 13,902
24,127
27,461
5
40 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Income statement analysis
41
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Income statementanalysis
Market and Shareholderinformation
Total income growth
Total cost growth
Income statement summary
Change % 1H 2014 1H 2013 FY 2013
Net interest income Nmillion 28 22,997 17,937 37,013
Non-interest income Nmillion 13 27,260 24,068 48,219
Credit impairment charges Nmillion (39) (1,438) (2,368) (2,667)
Operating expenses Nmillion 10 (29,202) (26,543) (57,948)
Profit before tax Nmillion 50 19,617 13,094 24,617
Profit after tax Nmillion 56 15,895 10,185 20,773
Total income contribution by business unit
Personal & Business Banking
30%
Personal & Business Banking
28%
Corporate & Investment Banking48%
Corporate & Investment Banking53%
Wealth19%
Wealth22%
1H 2014 1H 2013
Overview of group income (continued) Net interest income and margin analysisNet interest income and net interest margin CAGR (1H 2011-1H 2014): 27%
Composition of interest income
Change 1H 2014 1H 2013
% Nmillion Nmillion
Interest income on investment securities 19 10,812 9,108
Interest income on money market operations 73 2,191 1,269
Interest revenue on loans and advances - 21,014 20,938
Medium term advances/call loans 7 15,069 14,124
Overdrafts 26 2,935 2,324
Home loans (25) 676 903
Instalment sales & finance leases (12) 2,336 2,654
Interest income 12 34,017 30,382
Interest expense 11 11,020 12,445
Savings account 24 226 157
Current accounts (>100) 1,250 238
Call deposits 19 1,100 1,358
Term deposits 26 7,179 9,700
Other interest bearing liabilities (28) 1,265 992
Net interest income 28 22,997 17,937
Breakdown of net interest income
Net interest margin before impairment charges
Net interest margin after impairment charges
Net interest income Loans & advances Placements
Investment securities
1H 2011 1H 2012 1H 2013 1H 20140
35
30
25
20
15
10
5
40
18
24
10
14
35
12
20
10
5
1H 2011 1H 2012 1H 2013 1H 20140 0
15,000
20,000
10,000
5,000
25,000
6.0
7.0
5.0
4.0
3.0
2.0
1.0
8.0
13,866
17,937
22,997
Nmillion %
10
17,230
6.5%
5.5%
6.9%
6.4%
5.5%
4.7%
5.6%
4.9%
1H 2011 1H 2012 1H 2013 1H 20140
60
80
40
20
100
%
10
83%
16%
1%
19%
6%
25%
3%
30%
6%
75% 72% 63%
Total income and profitability CAGR (1H 2011-1H 2014): Total income: 21%
Profit after tax: 60%
Profit after tax/total incomeTotal income
Profit after tax
1H 2011 1H 2012 1H 2013 1H 20140
40,000
50,000
30,000
20,000
10,000
60,000
25.0
30.0
20.0
15.0
10.0
5.0
35.0
Nmillion %
28,207
3,849
31,048
4,993
42,005
10,185
50,257
15,895
5 Income growth Vs. Cost growth
42 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Income statement analysis
43
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Income statementanalysis
Market and Shareholderinformation
Net interest income and margin analysis (continued)
Factors impacting net interest income
Favourable
Decline in cost of funds, as lower priced deposits accounted 61% of deposits, resulting in increase in net interest income.
Interest income grew on the back of loan growth in the oil and gas, manufacturing and communication sectors.
Ability to improve loan pricing in line with market realities especially in the Personal and Business Banking segment contributed to growth in interest income.
Growth in interest income from interbank placement benefitting from increase in interbank deposits rates.
PBB’s contribution to net interest income increased to 48% in 1H 2014 (1H 2013: 46%).
Adverse
Increased pressure on margins with the further increase in cash reserve requirement by the central bank.
Non-interest revenue CAGR (1H 2011-1H 2014): 24%
Composition of non-interest revenue
Breakdown of non-interest revenue Change%
1H 2014Nmillion
1H 2013Nmillion
Net fee and commission revenue 25 18,764 14,981
Account transaction fees (10) 1,560 1,736
Card based commission 53 902 590
Brokerage and financial advisory fees 47 3,132 2,133
Asset management and custody fees 27 10,843 8,528
Electronic banking >100 183 59
Foreign currency service fees 48 896 606
Documentation and administration fees (8) 467 506
Others (5) 781 823
Trading revenue (6) 8,315 8,811
Foreign exchange 25 4,497 3,612
Interest rates (95) 231 4,418
Credit >100 3,598 776
Equity (>100) (11) 5
Other revenue (34) 181 276
Dividend income 18 68 58
Other non-bank revenue (48) 113 218
Total non-interest revenue 13 27,260 24,068
Non-interest revenue (NIR)
Percentage of total incomeNon-interest revenue Fees and commissions income Other revenue
Trading revenue
1H 2011 1H 2012 1H 2013 1H 20140
20,000
25,000
15,000
10,000
5,000
30,000
0
80
90
70
60
50
40
30
20
10
100
14,341
13,818
24,068
27,260
10
1H 2011 1H 2012 1H 2013 1H 20140
80
90
70
60
50
40
30
20
10
100
%
10
63 80 62 69
35 19 37 30
2 1 1 1
Net interest income by business unit
1H 2014 1H 2013
Corporate & Investment Banking
48%
Corporate & Investment Banking
49%
Personal & Business Banking48%
Personal & Business Banking46%
Wealth5%
Wealth4%
44 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Income statement analysis
45
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Income statementanalysis
Market and Shareholderinformation
Non-interest income by business unit
Favourable
Growth in net fees and commissions revenue from wealth business as assets under management continues to grow at a faster rate than the capital market.
High ATM uptime, increased usage of internet banking platform and other e-channels of payment contributed to significantly to growth in non-interest revenue.
Growth in foreign exchange trading revenue was driven by increased customer transaction volume and activities and ability to take advantage of volatility in the foreign exchange market.
The investment banking business contributed to the growth in non-interest revenue by executing good advisory mandates including a landmark deal in the oil and gas sector.
Factors impacting non-interest revenue
Adverse
Growth in net fees and commission revenue was hampered by regulatory induced reduction in transaction fees.
Revenue from stockbroking business was negatively impacted by the slow growth in the capital market performance.
Non-interest revenue (continued) Credit impairment charges
Change%
1H 2014Nmillion
1H 2013Nmillion
Specific credit impairment charges 10 2,365 2,144
Provision for performing loans >(100) (445) 493
Total impairment charges (27) 1,920 2,637
Recoveries 79 (482) (269)
Credit impairment charges (39) 1,438 2,368
Specific impairment
raised and releasedNmillion
General impairment
raised and releasedNmillion
RecoveriesNmillion
TotalNmillion
Mortgage lending 185 (9) (57) 119
Instalment sales and finance leases 17 77 (4) 90
Card 24 (1) - 23
Corporate lending 1,193 (826) (270) 97
Other loans and advance 946 314 (151) 1,109
Total impairment charges 2,365 (445) (482) 1,438
Impairment charges and credit loss ratio
Movement in credit impairment charges
Credit impairments by product
Credit loss ratioCredit impairment charge on non-performing loans Credit impairment charge on performing loans
(1.5)
(1.0)
(0.5)
0.0
0.5
1.0
1.5
2.0
2.5
1H 2011 1H 2012 1H 2013 1H 2014
1,000
1,500
500
0
(500)
(1,000)
2,000
Nmillion
1,300
745
1,020
270
1,875 1,883
493
(445)
5
1H 2014 1H 2013
Personal & Business Banking
14%
Personal & Business Banking
15%
Corporate & Investment Banking56%
Corporate & Investment Banking49%
Wealth36%
Wealth30%
46 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Income statement analysis
47
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Income statementanalysis
Market and Shareholderinformation
Change %
1H 2014Nmillion
1H 2013Nmillion
Corporate & Investment Banking (87) 98 765
Personal & Business Banking (16) 1,340 1,603
Credit impairment charges (39) 1,438 2,368
Credit impairment charges by business unit
Credit impairment charges (continued) Operating expenses
Operating expenses and cost-to-income ratio Composition of operation costs
Change%
1H 2014Nmillion
1H 2013Nmillion
Staff costs (9) 12,839 11,797
Other operating expenses: (11) 16,363 14,746
Communication 1 339 342
Depreciation (4) 1,822 1,753
Information technology (61) 2,519 1,563
Marketing and advertising (4) 1,026 986
Premises and maintenance 12 1,613 1,826
AMCON Fund and NDIC deposit insurance (16) 3,121 2,683
Travel and transportation (1) 602 598
Professional fees (30) 2,663 2,051
Others 10 2,658 2,944
Total operating expenses (10) 29,202 26,543
Breakdown of operating expenses
Average headcount of business unit
Cost-to-income ratioOperating expenses Staff costs Other operating expenses
Depreciation
1H 2011 1H 2012 1H 2013 1H 20140
25,000
30,000
20,000
15,000
10,000
5,000
35,000
80
90
70
60
50
40
30
20
10
0
100
18.9
20,768
23,640
26,51229,202
34.4
Nmillion
10
1H 2011 1H 2012 1H 2013 1H 20140%
80%
60%
40%
20%
100%
18.9
41.0 40.9
34.4
10
44%
6%
44%
7%
50%49%
43%
7%
49%
44%
12%
44%
Change %
1H 2014 Nmillion
FY 2013Nmillion
1H 2013Nmillion
Personal & Business Banking 3 966 998 1,075
Corporate & Investment Banking (3) 156 152 181
Wealth (2) 344 336 341
Credit 2 82 84 71
Other support functions - 505 507 470
Average number of employee 1 2,053 2,077 2,138
48 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Income statement analysis
49
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Income statementanalysis
Market and Shareholderinformation
Staff cost and headcount
Staff cost was impacted by:
Annual adjustment of staff salaries in line with market realities.
Growth in number of direct sales agents for branches.
Other operating expenses
Other operating cost was impacted by:
Growth in deposit insurance expenses due to increase in customer deposits.
Increase in rate of AMCON fund contribution to 0.5% from 0.3% of total assets impacting negatively on our expenses as our total assets continues to grow.
Significant increase in information technology expenses to improve our transactional service platform and enhance business efficiency.
Growth in marketing and advertising expenses
due to brand awareness campaign.
Operating expenses (continued)
Operating expenses by business unit
Personal & Business Banking52%
Personal & Business Banking50%
Corporate & Investment Banking37%
Corporate & Investment Banking38%
Wealth11%
Wealth12%
1H 2014 1H 2013
Taxation
Taxation charge and effective tax rate
The effective tax rate declined to 19.0% (1H 2013: 22.4%) notwithstanding an increase in tax payable, as revenue from tax exempt sources increased in 1H 2014.
Change %
1H 2014 Nmillion
1H 2013Nmillion
FY 2013Nmillion
Direct taxation
Normal taxation 39 3,949 2,835 6,326
Deferred tax >(100) (227) 74 (2,482)
Total taxation 28 3,722 2,909 3,844
Breakdown of taxation
Effective tax rateTaxation
1H 2011 1H 2012 1H 2013 1H 20140
3000
3500
2500
2000
1500
1000
500
4000
0
25.0
20.0
15.0
10.0
5.0
30.0
1,478
862
2,909
3,722
Nbillion
10
%
50 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014 51
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Balance sheetanalysis
Market and Shareholderinformation
Balance sheet
analysis
Balance sheet analysisOverview of group consolidated assets
Loans and advances
Loans and advances performance
Deposits and current accounts
Funding and liquidity
52
54
56
60
62
52 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Balance sheet analysis
53
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Balance sheetanalysis
Market and Shareholderinformation
Overview of group consolidated assets
Asset mix Breakdown of total assets
Cash and loans to banksTrading & derivative assets
Loans & advances to customersFinancial investments
Other assetsOther assets
Trading, derivatives & pledged assetsPledged assets
Cash and loans to banks
Financial investmentsLoans & advances to customers
Property & equipmentProperty & equipment
Overview of group consolidated assets
Return on assets
Pre-tax return on average assets After-tax return on average assets
The group’s balance sheet closed at N906.8 billion at the end of first six month of 2014. This represents a 19% growth over N763.0 billion recorded in FY 2013. On quarter-on-quarter basis, the group’s balance sheet increased by 12% between 1Q 2014 and 2Q 2014. The total assets growth was aided by increase in deposit liabilities which funded the growth in loans and advances and liquid assets. Net loans and advances to customers represented 38% of total assets.
The group’s after tax return on average assets improved to 3.8% (FY 2013: 2.9%), on the back of a higher growth rate in profit after tax than growth in average total assets.
0
1,000,000
N Million
900,000
800,000
700,000
600,000
500,000
400,000
300,000
200,000
100,000
Total Assets Cash & loans to bank
Trading andderivative assets
Pledged assets
906,838 176,068
150,352
23,541 156,666
342,214
34,226 23,771
Financialinvestments
Loans &advances to customers
Other assets Property& equipment
0
70
80
90
60
50
40
30
20
10
100
1H 12
5%
47%
12%
4%
14%
15%
FY 12
4%4%
39%
13%
4%
17%
19%
1H 13
3%6%
34%
17%
3%
20%
16%
FY 13
3%4%
38%
18%
3%6%
28%
1H 14
3%3%
38%
17%
3%
17%
19%
3%
%
1H 2014 FY 20130
700
800
600
500
400
300
200
100
1000
900
Nbillion
10
176.1
173.9
342.2
214.5
67.0
289.7
139.3
27.525.0156.7
26.331.7
1H 2012 FY 2012 1H 2013 FY 2013 1H 20140
4.0
3.5
4.5
3.0
2.5
2.0
1.5
1.0
0.5
5.0
2.2%
1.8%
1.9%
1.6%
2.7%
3.5% 3.4%
2.9%
4.7%
3.8%
10
%
54 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Balance sheet analysis
55
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Balance sheetanalysis
Market and Shareholderinformation
Loans and advances
Gross loans and advances Composition of gross loans and advances
Breakdown of loans and advances to customers
Change%
1H 2014Nmillion
FY 2013Nmillion
1H 2013Nmillion
Gross loans and advances 18 356,910 303,306 295,125
Home loans (11) 7,704 8,667 8,824
Instalment sales and finance leases 1 27,362 27,012 29,012
Overdrafts 26 42,077 33,526 34,495
Term loans 20 279,767 234,101 222,794
Provisions 8 (14,697) (13,559) (14,288)
Specific credit impairments 18 (10,554) (8,972) (9,953)
Portfolio credit impairments (10) (4,142) (4,587) (4,335)
Net loans and advances 18 342,214 289,747 280,837
Term loans78%
Mortgage2%
Overdrafts12%
Instalment sales & finance leases
8%
Breakdown of loans and advances by industry
1H 2014 1H 2013
Manufacturing19%
Manufacturing18%
Construction & real estate6%
Construction & real estate5%
Agriculture4%
Agriculture4%
Consumer credit19%
Consumer credit19%
Finance & insurance5%
Finance & insurance4%
Electricity & other utilities 3%
Electricity & other utilities 4%
Transportation & communication
13%
Transportation & communication
4%
Government1%
Government1%
General commerce
13%
General commerce
23%
Oil, gas & mining
17%
Oil, gas & mining
18%
Industry Change %
1H 2014Nmillion
FY 2013Nmillion
Agriculture 17 14,915 12,703
Construction and real estate 49 22,727 15,294
Electricity & other utilities 3 11,037 10,671
Finance & Insurance 39 18,071 13,017
Consumer credit 18 65,786 55,853
Manufacturing 18 65,937 55,741
Oil, gas & mining 12 62,210 55,568
General commerce (33) 47,488 70,967
Transportation & communication >100 46,675 11,318
Government (5) 2,064 2,174
Gross loans and advances 18 356,910 303,306
Loans and advances
Continued growth in loan book aided by increase in number of customers and increased points of representation.
Continued focus on lending to commercial and SME businesses.
Increase in corporate loans and advances despite stiff competition for good quality corporate credits.
Potential increase in annuity income as medium to long term loans accounted for 78% of total loan portfolio.
We continue to rebalance our loan portfolio taking into consideration sector concentrations. The transport and communications
sector increased to 13% (1H 2013: 4%) of our loan portfolio, while general commerce sector declined to 13% from 23% in 1H 2013.
The high interest rate environment continues to hinder growth in the loan portfolio as customers’ appetite to borrow remains low.
Breakdown of loans and advances by business unit
PBBNmillion
CIBNmillion
TotalNmillion
Overdrafts 23,335 18,742 42,077
Term loans 103,369 176,398 279,767
Instalment sales and finance leases 19,420 7,942 27,362
Home loans 7,704 - 7,704
Total loans and advances 153,828 203,082 356,910
0
50.0
100.0
150.0
200.0
250.0
300.0
400.0
350.0
1H 2012 FY 2012 1H2013 FY 2013
Nbillion
1H 2014
283.5 279.5 295.1 303.3
356.9
56 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Balance sheet analysis
57
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Balance sheetanalysis
Market and Shareholderinformation
Loans and advances performance
NPL and coverage ratioNon-performing loans
Breakdown of non-performing loans and advances by business unit
Non-performing loans by product
Change%
1H 2014Nmillion
FY 2013Nmillion
Overdrafts 36 1,599 1,179
Term loans 32 12,364 9,335
Instalment sales and finance leases 6 2,632 2,475
Home loans 34 559 418
Total loans and advances 28 17,154 13,407
PBBNmillion
CIBNmillion
TotalNmillion
Overdrafts 1,409 190 1,599
Term loans 6,340 6,024 12,364
Instalment sales and finance leases 2,348 284 2,632
Home loans 559 - 559
Total loans and advances 10,656 6,498 17,154
NPL/total loans Provision adequacyNon-performing loans Non-performing loans
Non-performing loans by industry
Change %
1H 2014Nmillion
FY 2013 Nmillion
Agriculture (5) 2,237 2,359
Construction and real estate 15 1,902 1,651
Electricity and other utilities >100 3,214 -
Mortgage 34 559 418
Consumer credit (22) 2,266 2,892
Manufacturing 4 1,390 1,333
Oil, gas & mining >100 971 352
General commerce (21) 2,649 3,356
Transportation and communication 88 1,966 1,046
Total non-performing loans 28 17,154 13,407
Non-performing loans worsened to N17.2 billion in 1H 2014 from N13.4 billion in FY 2013 due to a newly classified loan in the CIB business, resulting to non-performing loans to total loans ratio deteriorating to 4.8% from 4.4% at the end of FY 2013.
0
5.0
10.0
15.0
20.0
25.0
0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
9.0
8.0
1H 2012 FY 2012 1H 2013 1H 2014FY 2013
23.4
Nbillion %
10
8.3%
14.3
Non-performing loans
NPL/total loans
5.1%
13.5
4.6%
13.4 17.2
4.4%
4.8%
01H 2012 FY 2012 1H 2013 1H 2014FY 2013
10
47.0%
Non-performing loans
NPL/total loans
91.6% 105.7%101.1%
85.7%
8.3%
5.1% 4.6% 4.4% 4.8%
58 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Balance sheet analysis
59
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Balance sheetanalysis
Market and Shareholderinformation
Asset quality
Performing loans Non-performing loans
Neither past due nor specifically impaired
Not specifically impaired
Specifically impaired loans
Total Loans and Advances
to Customers
Balance sheet
impairments for
performing loans
Normal monitoring
Close monitoring
Early arrears
Non- performing
Sub-standard Doubtful Loss Total
Securities and expected recoveries on
specifically impaired
loans
Net after securities
and expected recoveries on
specifically impaired
loans
Balance sheet impairments
for non- performing specifically
impaired loans
Gross specific impairment
coverage
Total non- performing
loans
Non- performing
loans
June 2014 Nmillion Nmillion Nmillion Nmillion Nmillion Nmillion Nmillion Nmillion Nmillion Nmillion Nmillion Nmillion Nmillion % Nmillion %
Personal & Business Banking
153,828 2,110 116,789 3,545 22,839 - 3,865 3,652 3,138 10,655 3,388 7,267 7,267 68 10,655 6.9
Mortgage loans 7,704 74 5,268 218 1 659 - 244 69 246 559 123 436 436 78 559 7.3
Instalment sale and finance leases
19,420 521 12,346 426 4,300 - 2,009 325 14 2,348 1,090 1,258 1,258 54 2,348 12.1
Card debtors 973 2 686 - 187 - 45 17 37 99 6 93 93 94 99 10.2
Other loans and advances
125,731 1,513 98,489 2901 16,693 - 1,567 3,241 2,841 7,649 2,169 5,480 5,480 72 7,649 6.1
Corporate & Investment Banking
203,082 2,032 194,417 2,168 - - 3,214 3,284 - 6,498 3,211 3,287 3,287 51 6,498 3.2
Corporate loans 203,082 2,032 194,417 2,168 - - 3,214 3,284 - 6,498 3,211 3,287 3,287 51 6,498 3.2
Gross loans and advances
356,910 4,142 311,206 5,713 22,839 - 7,079 6,936 3,138 17,153 6,599 10,554 10,554 62 17,153 4.8
Asset quality
60 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Balance sheet analysis
61
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Balance sheetanalysis
Market and Shareholderinformation
Deposits and current accounts
Deposit liabilities CAGR (1H 2011-1H 2014): 20%
Deposit mix
Breakdown of total deposits Change%
1H 2014Nmillion
FY 2013Nmillion
1H 2013Nmillion
Deposits from banks (17) 42,691 51,686 150,974
Deposits from banks (17) 42,691 51,686 150,974
Deposits from customers 23 511,763 416,352 370,020
Current accounts 48 293,684 198,320 149,425
Call deposits (29) 37,368 52,927 32,990
Savings accounts 2 19,469 19,097 16,948
Term deposits 10 161,242 146,008 170,657
Total deposits and current accounts 18 554,454 468,038 520,994
Deposit breakdown by business unit Change%
1H 2014Nmillion
FY 2013Nmillion
1H 2013Nmillion
Pesonal & Business Banking 1 200 106 197 898 180 578
Current accounts (1) 97,747 98,550 80,964
Savings deposits 4 19,469 19,097 16,948
Call deposits (31) 6,437 8,863 5,213
Term deposits 7 76,452 71,388 77,453
Corporate & Investment Banking 43 311,657 218,454 189,442
Current accounts 79 195,937 99,770 68,461
Call deposits (1) 30,931 44,064 27,777
Term deposits 20 84,790 74,620 93,204
Total deposits and current accounts 23 511,763 416,352 370,020
Term deposits
Call deposits
Savings accounts
Current accounts
Deposit liabilities
Strong growth in deposits by 23%, a function of our expanded delivery channels and increase in number of customers.
Demand deposits grew by 48% and accounted for 57% of total deposits, benefitting from our conscious effort to exit expensive term deposits and replacing them with lower priced deposits.
Decline in funding cost as a result of a shift in focus to demand and savings deposits as against raising term deposits.
0
100
200
300
400
500
600
1H 2012 FY 2012 1H 2013 1H 2014FY 2013
246.2
Nbillion
10
355.4370.0
416.4
511.8
1H 2012 FY 2012 1H 2013 FY 2013 1H 20140
80
60
40
20
100
10
43%
11%
41%
39%
6%
5%
4%
51%
40%
9%
5%
46%
48%
13%
4%
35%
57%
7%4%
32%
%
62 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Balance sheet analysis
63
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Balance sheetanalysis
Market and Shareholderinformation
10Funding and liquidity
Balance sheet funding
Funding mix
Assets Liabilities
1H 2014 FY 2013
Equity 12%
Borrowings 8%
Other liabilities
9%
Trading liabilities
9%
Deposits from banks
5%Deposits from customers 56%
Equity 13%
Borrowings 6%
Other liabilities
11%
Trading liabilities
9%
Deposits from banks
7%
Deposits from customers 55%
1122632
84157
70
342
43
172512
176
86
Property & equipment and intangible assets
EquityOther assets
Other liabilitiesFinancial investments
Other borrowings
Loans & advances to customers
Deposits from banks
Trading, derivatives and pledged assets
Deposits from customers
Cash and loans to banks
Trading & derivative liabilities
Nbillion
Liquidity market overview
The group’s liquidity risk management framework is designed to measure and manage the liquidity position at various levels of consolidation so that payment obligations could be met at all times, under both normal and considerably stressed conditions. Under the delegated authority of the board, the Asset and Liability Committee (ALCO) sets liquidity risk policies in accordance with regulatory requirements and international best practice.
The Central bank further tightened its monetary policy measures by increasing cash reserve ratio requirement (CRR) on private sector deposits to 15% from 12%, while maintaining CRR on public sector deposits at 75%, monetary policy ratio at 12% and liquidity ratio remained 30%.
The group is planning to raise up to N30 billion through a corporate bond in 2H 2014 to support its business growth and expansion.
Liquidity ratio computation Group1H 2014Nmillion
GroupFY 2013Nmillion
Bank1H 2014Nmillion
BankFY 2013Nmillion
Specified liquid assets
Cash 11,115 13,814 11,115 12,965
Balance with CBN (net DR/CR balance, and excluding CRR) 8,411 98,427 8,181 83,922
Net balance held with banks within Nigeria 9 9 9 9
Treasury Bills 273,158 168,445 261,694 171,509
Net Money At Call with Other Banks 5,029 - 5,029 -
Federal Government of Nigeria bonds 5,401 9,357 1,056 5,186
Stabilisation Securities 1,085 1,085 1,085 1,085
Total Asset (A) 304,209 291,138 288,170 274,677
Current liabilities
Adjusted deposit liabilities 398,855 326,888 400,383 312,695
Total liabilities (B) 398,855 326,888 400,383 312,695
Liquidity ratio A/B*100 76.3% 89.1% 72.0% 87.8%
64 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Balance sheet analysis
65
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Balance sheetanalysis
Market and Shareholderinformation
Limits are set to restrict the cumulative liquidity mismatch between expected inflows and outflows of funds in different time buckets.
Behavioural profiling is applied to assets, liabilities and off balance sheet commitments with an indeterminable maturity or drawdown period, as well as to certain liquid assets.
Behavioural profiling assigns probable maturities based on actual customer behaviour. This process is used to identify additional sources of structural liquidity in the form of liquid assets and core deposits, such as current and savings accounts that although repayable on demand or at short notice, exhibit stable behaviour.
The behaviourally adjusted cumulative liquidity mismatch remains well within liquidity risk appetite.
Structural liquidity requirements
Group unencumbered surplus liquidity Change%
1H 2014Nmillion
FY 2013Nmillion
Marketable assets 41 245,773 174,094
Short-term foreign currency placements >100 35,586 6,139
Total unencumbered marketable assets 56 281,359 180,234
Other readily accessible liquidity (14) 72,935 84,997
Total unencumbered surplus liquidity 34 354,294 265,231
Funding and liquidity (continued)
Liquidity buffer
Portfolios of highly liquid marketable securities, over and above prudential requirements, are maintained as protection against unexpected disruptions in cash flows. These holdings are considered in the context of internal stress tests and discounts assumed on certain securities in a possible sale.
The amount of contingent liquidity required the group’s liquidity risk standard is influenced by the nature of the depositor, and the contractual terms of the deposit as well as the prevailing and anticipated regulation.
The surplus liquidity holdings are managed taking into account liquidity stress testing results and CBN regulation. The unencumbered surplus liquidity amounted to N354.3 billion as at 30 June 2014.
Diversified funding base
The group’s funding strategy is derived from the projected balance sheet growth which includes consideration of Personal & Business Banking and Corporate & Investment Banking asset classes, capital requirements, the maturity profile of existing funding and anticipated changes in the retail deposit base. Funding requirements and initiatives are assessed in accordance with the group asset and liability committee requirements for diversification, tenor and currency exposure, as well as the availability and pricing of alternative liquidity sources.
Concentration risk limits are used within the group to ensure that funding diversification is maintained across products, sectors, geographic regions and counterparties.
Primary sources of funding are in the form of deposits across a spectrum of retail and wholesale clients, as well as long term capital market funding. Deposit from customers funded 56% of total assets in 1H 2014.
Medium to long term funding form Development and Financial institutions form part of our diversified funding base. Funding from this source accounted for 8% of total liabilities and increased to N63.6 billion from N48.8 billion at the end of 2013.
Liquidity stress testing and scenario analysis
Anticipated on- and-off balance sheet cash flows are subjected to a variety of bank specific and systemic stresses and scenarios in order to evaluate the impact of unlikely but plausible events on liquidity positions.
The outcomes of the stress scenarios are considered by asset and liability management committees on a monthly basis, and inform minimum liquid asset buffer requirements and contingency funding plans.
66 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Capital management
67
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Capitalmanagement
Market and Shareholderinformation
Capital managementReturn on ordinary equity
Risk weighted assets
67
68
Capitalmanagement
Return on ordinary equity
Shareholders’ funds
Shareholders’ fund
Shareholders’ equity increased by 16% to N109.6 billion in 1H 2014 (FY 2012: N94.3 billion). The pre-tax and post-tax return on average equity increased significantly to 37.7% and 28.9% respectively on an annualized basis. This performance is better than pre-tax return on average equity of 30.0% and post-tax return on equity of 21.3% achieved in 1H 2013. The significant increase in profit before and after tax aided the significant increase in return on average equity.
0
70.0
80.0
60.0
50.0
40.0
30.0
20.0
10.0
90.0
110.0
100.0
Nbillion
10
1H 2014
109.6
1H 2012
85.1
FY 2012
83.3
1H 2013
91.8
FY 2013
94.3
Average shareholders’ fund and return on equity
Shareholders’ fund (average) ROaE (PAT) ROaE (PBT)
0 0
10,000
20,000
40,000
30,000
50,000
70,000
60,000
90,000
110,000
80,000
100,000
5.0
10.0
20.0
15.0
30.0
25.0
35.0
40.0
%Nmillion
10
ROaE (PAT) ROaE (PAT)
1H 2012
83,191
14.8%
10.6%
FY 2012
81,604
14.4%
10.9%
1H 2013
88,446
30.0%
21.3%
FY 2013
88,827
27.7%
21.0%
1H 2014
101,932
37.7%
28.9%
69
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Market & Shareholderinformation
Otherinformation
Market and shareholder information
68 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Capital management
Market and shareholder informationMarket capitalisation and price-to-book ratio
Dividend payment history
Equity and range analysis
Share capital history
70
70
71
71
Market and shareholderinformation
Capital adequacy computation Group1H 2014Nmillion
GroupFY 2013Nmillion
Bank1H 2014Nmillion
BankFY 2013Nmillion
Tier I capital 86,335 86,376 56,328 63,130
Tier II capital 10,064 9,941 7,086 6,408
Total qualifying capital 96,399 96,317 63,414 69,538
Risk weighted assets 486,271 392,888 468,942 380,437
Capital adequacy
Tier I 17.8% 22.0% 12.0% 16.6%
Tier II 2.1% 2.5% 1.5% 1.7%
Total 19.8% 24.5% 13.5% 18.3%
Risk - weighted assets
Tier 1 capital adequacy
Total capital adequacy
Statutory minimum
Total assets and risk weighted assets Capital adequacy ratio
1H 2012 FY 2012 1H 2013 FY 2013 1H 2014
Total assets 577,442 676,819 818,336 763,046 906,838
Risk-weighted assets
361,770 377,993 433,865 392,888 486,271
% risk weighted assets to total assets
62.7% 55.8% 53.0% 51.5% 53.6%
The group’s capital adequacy ratios remain at strong levels and are well above the regulatory requirement. The tier 1 capital adequacy ratio stood at 17.8% (Bank 12.0%), while the total capital adequacy ratio was 19.8% (Bank 13.5%). These ratios are well above the 10% minimum statutory requirement. The group’s capital is deemed adequate to support our planned growth opportunities within Nigeria as well as business risks and contingencies.
0
700,000
800,000
600,000
500,000
400,000
300,000
200,000
100,000
1,000,000
900,000
Nmillion
5
0
10
20
30
40
50
60
70
%
1H 2012 FY 2012 1H 2013 FY 2013 1H 20140
25.0
30.0
20.0
15.0
10.0
5.0
35.0
%
21.3 21.920.7
22.3
17.8
20.822.0
24.5
17.819.8
5
70 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Market and shareholder information
71
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Market & Shareholderinformation
Otherinformation
Market and shareholder information
Market capitalisation and price-to-book ratioMarket capitalisation Net asset value per share and price-to-book
Net asset value per share Price-to-book
Equity and range analysis
The shareholding pattern of the Group as at 30 June 2014
Share range No. of shareholders
% shareholders
No. of holding
% holdings
1 - 1,000 39,038 39.5 21,264,848 0.2
1001 - 5,000 38,129 38.7 79,222,018 0.8
5,001 - 10,000 10,302 10.5 64,075,369 0.6
10,001 - 50,000 8,698 8.8 164,680,130 1.7
50,001 - 100,000 1,310 1.3 82,422,953 0.8
100,001 - 500,000 962 1.0 175,497,653 1.8
500,001 - 1,000,000 125 0.1 79,520,005 0.8
1,000,001 - 5,000,000 94 0.1 197,699,050 2.0
5,000,001 - 10,000,000 16 0.0 113,142,753 1.1
10,000,001 - 50,000,000 41 0.0 824,580,918 8.2
50,000,001 - 10,000,000,000 26 0.0 8,197,894,303 82.0
Grand Total 98,741 100.0 10,000,000,000 100.0
Significant shareholding of 5% and above
ShareholderNo of shares held
30 June 2014Shareholding
%No of shares held
31 Dec 2013 Shareholding
%
Stanbic Africa Holdings Limited 5,318,957,354 53.2 5,316,268,150 53.2
First Century International Limited 747,089,076 7.5 747,089,076 7.5
Share exchange history
Authorised (N000) Issued and fully paid up
Year increase cumulative increase cumulative Consideration
2012 - 500 - 125 share exchange
2012 9,999,500 10,000,000 10,000,000 10,000,000 share exchange
Dividend payment history
Period ended Total amount paidNmillion
Dividend paid per shareKobo
December 31, 2014
Interim proposed: 11,000 110
December 31, 2013
Interim: 1,000 10
Final: 7,000 70
December 31, 2012
Final: 8,500 60
Stanbic IBTC’s shares outperformed both the NSE All Share Index and the Banking Industry index in 1H 2014. The group’s price-to-book ratio of 2.4 times, evidenced that investor confidence in the ability of the group to deliver value and better future returns. As at year end, the group ranked 11th in market capitalisation amongst the 190 listed equities on the Nigerian Stock Exchange.
Change % 1H 2014 FY 2013
Number of shares at the end of the period thousands - 10,000,000 10,000,000
Net asset value Nmillion 16 109,551 94,313
Net asset value per share kobo 16 1,096 943
Share price at the end of the period kobo 22 2,600 2,135
Market capitalisation at end of the period Nbillion 22 260.0 213.5
Price-to-book at end of the period times 5 2.4 2.3
1H 2012 FY 2012 1H 2013 FY 2013 1H 20140
200
150
100
50
300
250
120 110
155
213
260
Nbillion
10
1H 2012 FY 2012 1H 2013 FY 2013 1H 20140 0
800
600
400
200
1,200 2.5
2.0
1.5
1.0
0.5
1,000
Kobo Times
10
454 833 918 943 1,096
1.4
1.31.7
2.3 2.4
72 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Other information
73
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Otherinformation
Market and Shareholderinformation
Other informationFinancial and other definitions
Contact details
73
74
Otherinformation
Basic earnings per ordinary share (EPS) (kobo) Earnings attributable to ordinary shareholders divided by the ordinary shares in issue.
CAGR (%) Compound annual growth rate.
Cost-to-income ratio (%) Operating expenses as a percentage of total income.
Credit loss ratio (%) Total impairment charges on loans and advances per the income statement as a percentage of gross loans and advances.
Dividend cover (times) Earnings per share divided by dividend per share.
Dividend per share (kobo) Total dividends to ordinary shareholders including dividends and scrip distributions declared per share in respect of the period.
Gross impairment coverage (%) Non-performing loan impairments as a percentage of gross non-performing loans.
Net asset value (Nmillion) Equity attributable to ordinary shareholders.
Net asset value per share (kobo) Net asset value divided by the number of ordinary shares in issue at the end of the period.
Net interest margin (%) Net interest income as a percentage of average of total assets less derivative assets.
Non-interest revenue to total income (%) Non-interest revenue as a percentage of total income.
Non-performing loans ratio (%) Total non-performing loans as a percentage of gross loans and advances.
Price-to-book ratio (times) Market capitalisation divided by net asset value.
Profit attributable to ordinary shareholders Profit for the period attributable to ordinary shareholders, calculated was profit for the period less minority interests.
Profit for the period (Nmillion) Income statement profit attributable to ordinary shareholders and minorities shareholders for the period.
Provision of performing loans (Nmillion) Provisions for incurred credit losses inherent in the performing loan book.
Provisions for non-performing loans (Nmillion) Provisions for specific identified credit losses.
Shares in issue (number) Number of ordinary shares in issue as listed on the floor of the Nigerian Stock Exchange (NSE).
Total capital adequacy ratio (%) Regulatory capital divided by risk-weighted assets.
Turnover in shares traded (%) Number of shares traded during the period as a percentage of the weighted average number of shares.
Weighted average number of share (number) The weighted average number of ordinary shares in issue during the period as recorded on the NSE.
Financial and other definitions
75
Group results in brief
Business unitreview
Income statementanalysis
Balance sheet analysis
Capital management
Otherinformation
Business unitreview
Market and Shareholderinformation
74 Stanbic IBTC Analysis of financial results for the six months ended 30 June 2014
Other information
Contact details
Registered address:
Stanbic IBTC Holdings PLCI.B.T.C. PlaceWalter Carrington CrescentP. O. Box 71707Victoria IslandLagosNigeria
Henry AnahHead: Investor Relations
T: +234 1 4228742 E: [email protected]
Arthur Oginga Chief Financial Officer
T: +234 1 4228746E: [email protected]
Chidi OkezieCompany Secretary
T: +234 1 4228695E: [email protected]
Stanbic IBTC Holdings PLC RC1018051
www.stanbicibtc.comDesigned and produced by Creative Interpartners, LondonEmail: [email protected]
Photography: Centaur Photographers