The Interest Income Engine
Sterling's unaudited nine-month results show a lender leaning hard into its loan book. Interest earned on loans and advances to customers reached ₦244.42 billion, up from ₦175.03 billion a year earlier, and drove most of the growth in total interest income. Funding costs rose too, but more slowly than asset yields, so net interest income expanded by almost 44%.
Non-interest income added a second leg. Net fees and commission income grew 10.4% to ₦39.63 billion, other operating income nearly doubled to ₦40.23 billion from ₦20.59 billion, and only trading income went backwards, easing 6.5% to ₦21.30 billion. The mix matters: earnings are broadening beyond the commercial bank into the group's non-interest banking arm, Alternative Bank, and its wealth manager, SterlingFi.
The Impairment Bill
Growth came with a much larger credit bill. Impairment charges of ₦40.28 billion were almost five times the ₦8.09 billion booked a year earlier, and operating expenses rose 18.3% to ₦169.49 billion as personnel costs climbed 33.7% to ₦54.21 billion. Even after absorbing both, net operating income after impairment rose 24.5% to ₦266.77 billion.
The asset-quality signal is, so far, reassuring: the non-performing loan ratio improved slightly to 4.6% from 4.7% at the end of December 2025, suggesting the provisioning surge reflects a rapidly expanding loan book and prudence rather than a visible deterioration. Investors will want that ratio to hold as the ₦1.82 trillion loan book seasons.
A Bigger, Better-Funded Balance Sheet
Deposits grew almost in step with lending, rising 28.7% to ₦3.84 trillion from ₦2.98 trillion, which keeps the expansion funded by customers rather than wholesale borrowing. Shareholders' funds rose to ₦595.16 billion from ₦428.70 billion, helped by ₦94.40 billion of public-offer proceeds booked during the period — capital that also underpins the group's position in the Central Bank's recapitalisation programme.
What Investors Watch Next
Sterling has crossed the ₦5 trillion asset mark while keeping profitability growing at a fifth and returns on average equity at about 20%. The test for the final quarter is whether impairment charges stay at this elevated run-rate or normalise: at ₦40 billion in nine months, credit costs are now the single biggest swing factor between a good year and a great one.
