Sterling Financial Holdings Company Plc Grows Q1 Profit by 36% to N23.38 Billion

Sterling Financial Holdings Company Plc recorded a strong first-quarter (Q1) performance in 2026 as rising interest income, expanding loan portfolio and higher operating income lifted profitability despite increased impairment charges and rising operating costs.

According to the group’s condensed unaudited interim financial statements for the period ended March 31, 2026, profit after tax rose by 35.7 percent to N23.38 billion from N17.23 billion recorded in the corresponding period of 2025.

Profit before income tax increased to N27.92 billion from N18.26 billion, supported by strong growth in interest income and non-interest revenue streams.

Interest income climbed significantly to N106.26 billion during the quarter compared to N78.36 billion reported a year earlier while interest expense rose to N41.41 billion from N30.93 billion due to higher funding costs across the banking sector.

Despite the increase in interest expense, net interest income improved to N64.86 billion from N47.42 billion in the corresponding period of 2025.

Net fees and commission income increased to N13.40 billion from N10.13 billion while net trading income rose to N3.37 billion from N2.90 billion.

Other operating income surged sharply to N11.79 billion from N3.86 billion, contributing to the group’s total operating income of N93.41 billion, compared to N64.30 billion recorded in the first quarter of 2025.

However, credit loss expense on financial assets increased significantly to N9.20 billion from N2.45 billion, indicating higher provisioning amid growing lending activities and macroeconomic pressures.

Net operating income after impairment stood at N84.21 billion compared to N61.86 billion in the corresponding period.

Operating expenses also rose across major cost lines during the quarter. Personnel expenses increased to N15.32 billion from N10.64 billion while other operating expenses rose to N16.30 billion from N12.40 billion.

General and administrative expenses climbed to N16.39 billion from N14.38 billion while depreciation and amortisation costs increased to N2.61 billion from N1.83 billion.

Total expenses rose to N56.30 billion from N43.59 billion, reflecting inflationary pressure, technology investments and rising operating costs across the financial services industry.

Despite the increase in expenses, the group maintained stronger profitability with earnings per share holding at 38 kobo.

On the balance sheet, total assets expanded to N4.07 trillion as of March 31, 2026, from N3.91 trillion recorded at the end of 2025.

Loans and advances to customers rose to N1.44 trillion from N1.41 trillion while debt instruments measured at fair value through other comprehensive income increased sharply to N812.18 billion from N646.47 billion.

Cash and balances with the Central Bank of Nigeria stood at N725.21 billion while due from banks increased to N484.53 billion from N472.27 billion.

Customer deposits, however, declined slightly to N2.95 trillion from N2.98 trillion while deposits from banks increased to N99.94 billion from zero at the end of 2025.

Shareholders’ funds strengthened significantly to N542.48 billion from N428.70 billion, supported by higher retained earnings and increased share capital and share premium positions.

The group also reported total comprehensive income of N19.37 billion after recording N4.01 billion in other comprehensive losses linked largely to fair value declines on investment securities.

Analysts said Sterling HoldCo’s first-quarter performance reflects stronger revenue generation capacity in the current high-interest-rate environment but warned that rising impairment charges and operating costs could remain key pressure points for banks through the rest of 2026.