Stanbic IBTC Reports Q4 2015 Results

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Stanbic IBTC Holdings finally published its Q4 2015 results today. The delay was due to a dispute with the Financial Reporting Council of Nigeria which has now been resolved. There was no further explanation provided as to the resolution reached and management has also stated that there will be no conference calls to discuss the results. We find this disappointing.The results in themselves showed that the underlying results were in line with expectations. Although PBT and PAT of N8.3bnand N4.4bn were ahead of our forecasts by 54% and 22% respectively, the results were boosted by lower-than-expected loan loss provisions. Profit before provisions of N26.4bn was in line with our forecast. Along with the resolution reached with the FRC, Stanbic also restated its 2014 financials.The restated PBT and PAT are 6-8% higher than the previous numbers. The full year PBT figure shows a decline of -46% y/y while the PAT is down -39% y/y. The driver behind these declines is the loan loss provisions line which shows a marked 364% y/y increase to N14.9bn.With regards to the actual Q4 provisions, they surprised positively relative to our estimate and declined -47% q/q. Essentially the high levels of provisions for the full year can be traced to what Stanbic had already reported in the 9M period.Given that the underlying results themselves were broadly in line, we do not expect any significant movement in the shares  on the back of these results. Stanbic is yet to report Q1 – Q3 2016 results. These will carry more weight than the 2015 results, given the sector’s worsening fundamentals.