Sterling Bank to aggressively grow retail business through electronic channels

…Stakeholders applaud Bank for impressive performance

Following the declaration of a profit after tax of N5.2 billion on gross earnings of N111 billion for the financial year ended December 31, 2016, Sterling Bank, your one-customer bank, is planning to aggressively grow its retail business through electronic channels.

The bank made the disclosure at the Annual General Meeting (AGM) held in Lagos recently. Similarly, Shareholders have applauded the board and management of the bank for the impressive performance despite economic challenges.

In his remarks, Mr. Yemi Adeola, the Managing Director/ Chief Executive Officer of the bank said, “2016 was a difficult year for the Nigerian economy as it was characterized by high inflation, weak oil prices, lower crude oil output and foreign exchange supply shortages. These multiple challenges and the various regulatory responses put significant downward pressure on the earnings of banks.

“In the face of these difficulties, our gross earnings grew for the 6th consecutive year to N111.4 billion.  We also maintained our commitment to operating efficiency, as highlighted by an improvement in net interest margin to 9.3 per cent and a 22.5 per cent growth in interest income. In addition, we successfully limited the growth in operating expenses to 1.9 per cent despite the high inflationary environment”, Adeola explained.

The CEO also said that during the year, the bank successfully deployed the “best in class” core banking application – Temenos T24; growing its active customer base and launched the disruptive, award winning payments solution, ChatPay, while optimizing its traditional electronic channel offerings.

L-R: Managing Director/CEO, Sterling Bank Plc, Mr. Yemi Adeola; Chairman, Asue Ighodalo and Company Secretary, Mrs. Justina Lewa, during the bank’s 55th Annual General Meeting in Lagos recently.

He said these initiatives would enable the bank optimize operating efficiency and position it to exploit emerging business opportunities. On the future outlook for the bank under its 2017- 21 Strategic Plan, Mr. Adeola said: “We expect that the Federal Government’s fiscal intervention schemes alongside supportive economic policies will create pathways for economic recovery. Over the next 5 years, we will be steering our ship differently and aggressively growing the retail business through electronic channels”.

He said in a bid to achieve this, the bank would prioritize efficiency over scale with the goal of achieving steady growth and sustainable returns to all its stakeholders, optimize its cost profile while providing its customers with ‘best in class’ service.

Adeola also said the bank would boost innovative banking driven by market insights that would enable it to satisfactorily serve its customers and earn their trust, implement significant investment in technology-led growth initiatives as well as accelerate remarkable growth of its non-interest banking segment.

Earlier in his address to shareholders at the AGM, Chairman of the bank, Mr. Asue Ighodalo,  said the bank reported a profit after tax of N5.2 billion on gross earnings of N111 billion for the financial year ended December 31, 2016.

He said net interest income increased by 41.6 per cent to N56 billion as against N39.5 billion in 2015 as a result of 22.5 per cent increase in interest income and a 4.2 per cent increase in interest expense while net operating income dropped slightly to N56.6 billion from N60.7 billion in 2015 owing to a 43.7per cent increase in impairment charges.

The chairman said operating expenses itched up marginally to N50.6 billion from N49.7 billion in 2015 as a result strategic cost control measures in response to inflationary pressures.

Further analysis of the bank’s financial position showed that net loans and advances increased by 38.2 per cent to N468.2 billion compared to N338.7 billion in 2015 driven primarily by foreign exchange revaluation.

Total assets (excluding contingent liabilities) increased by 4.3 per cent to N834.2 billion from N799.5 billion in 2015 while shareholders’ funds stood at N85.7 billion arising from fair value adjustments on Available-For-Sale investments and organic accretion of profit.

Dr. Faruk Umar, President of Association for the Advancement of the Rights of Shareholders (AARNS), praised the lender for posting better performance than it did in 2015 based on its current capital base, remarking that if it were to have a robust capital base like some of big the banks, its performance would have been better.

Umar said the board and management of the bank were very prudent and responsible, and commended the bank for recently wining the Agric Bank of the Year Award from the Nigeria Agriculture Awards (NAA).

The shareholders’ leader also said the Audit Committee of the bank was made up of credible members who were able to maintain the same level of fees for the external auditors in 2014.

Umar who said the Bank was likely to do better this year, also commended the Chairman of the Bank, Mr. Asue Ighodalo for his effective leadership.

Similarly, Mr. Sunny Nwosu, National Coordinator of the Independent Shareholders Association of Nigeria (ISAN), said he commended the management of the Bank for being able to make a profit for the 2016 trading year.

He said the lender did not declare dividend for its shareholders because of the need to create greater value for the future, stressing that a critical analysis of the accounts of the Bank showed that the management were efficiently working round the clock to post the positive performance.


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