Since the issuance of the regulatory directive and in line
with its key strategic objective of driving economic growth in Nigeria, Stanbic
IBTC Bank (“the Bank”) has increasingly focused on the growth of its credit
exposures to the real sector of the economy.
The focus and concerted efforts of the Bank’s management to
ensure compliance with the regulatory directive of improving lending to the
real sector of the Nigerian economy have been responsible for the growth in the
risk asset portfolio for Stanbic IBTC Bank over the last two years. The loan
book increased by 18% from FY 2019 position of N556.4bn to N655.3bn as at 31
December 2020.
The Bank also recorded an increased loan growth by 30% from
the 31 December 2020 position to a gross risk asset position of N854.9bn
recorded as at 30 September 2021. It is important to note that the risk asset
growth of 18% and 30% recorded by the Bank in FY 2020 and as at Q3:2021 remain
significantly higher than the industry average growth of 18% and 8% in FY 2020
and as at Q3:2021, respectively.
Consequent upon the significant growth recorded in the
Bank’s risk asset growth in 2020 and YTD 2021, the Bank has remained compliant
with the CBN’s daily minimum LDR requirement of 65% with a FY 2020 daily LDR average
of 65.84% and 2021 YTD daily average of 69.86%. It is important to note that
the Bank suffered no CRR debits by the CBN for non-compliance with the
regulatory LDR directive over the period.
For good record, it is also noted that the growth in the Bank’s
Cash Reserve Requirement (CRR) position from N369.0bn as at 31 December 2020 to
N462.6bn as at 30 September 2021 has been largely on account of the monetary
policy actions introduced by the CBN to rein in inflationary and exchange rate
pressures in the economy. In line with its price stability and monetary policy
mandates, the CBN is saddled with the responsibility of managing surplus
liquidity in the system and at various times over the period, the CBN has
introduced special CRR debits to sterilize surplus market liquidity.
These special CRR debits which are over and above the
minimum regulatory cash reserving requirement of 27.5% of customer deposit
growth have indeed been responsible for the growth in Stanbic IBTC Bank’s total
and effective CRR positions which stood at N462.6bn and 60.09% respectively as
at 30 September 2021.
Notwithstanding the financial constraints arising from the
sterilized liquidity from the CBN, Stanbic IBTC Bank remains very liquid and
adequately capitalized with liquidity ratio and capital adequacy ratio standing
at 96.2% and 15.7% respectively as at 30 September 2021 and above the
regulatory minimum of 30% for liquidity ratio and 8% for capital adequacy
ratio.
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