Infinity Trust Mortgage Bank Plc reported a strong first-quarter performance, with profit rising sharply on the back of increased lending activity and higher interest income, even as costs and leverage climbed.
The mortgage lender posted a profit after tax of N846.4 million for the first quarter of 2026, a 56 percent increase from N541.0 million in the same period last year.
Profit before tax rose to N898.6 million from N601.6 million, supported by a surge in operating income as the bank expanded its loan book and interest-earning assets.
Interest income surged to N1.77 billion from N1.08 billion a year earlier, driven largely by growth in mortgage loans and advances, which continue to anchor the bank’s core business.
Net interest income stood at N1.23 billion, up from N741.2 million, underscoring improved asset yields despite rising funding costs.
Total operating income increased to N1.39 billion from N943.8 million, as fee and commission income also grew, though still modest relative to interest income.
The results reflect a business increasingly driven by credit expansion. Loans and advances to customers rose sharply to N34.76 billion from N17.37 billion in the corresponding period of 2025, highlighting aggressive lending growth.
However, this expansion came with rising costs. Interest expenses increased to N538.8 million from N341.6 million, pointing to higher funding costs amid Nigeria’s tight monetary environment.
Operating expenses also climbed significantly to N486.4 million from N342.3 million, driven by higher administrative and other operating costs, including a notable jump in marketing and general expenses.
Despite these pressures, the bank maintained profitability, with cost growth lagging income expansion, allowing margins to improve.
On the balance sheet, total assets rose to N48.8 billion from N29.2 billion a year earlier, reflecting growth in loans, investment securities, and bank placements.
The bank’s funding structure shifted notably, with debt issued and other borrowed funds surging to N21.63 billion from N7.85 billion, indicating increased reliance on wholesale funding to support loan growth.
Customer deposits also grew to N10.98 billion from N8.39 billion, though at a slower pace compared to borrowings.
This divergence suggests that the bank is leaning more on institutional funding sources, including development finance and mortgage refinancing facilities, to sustain its expansion.
Liquidity weakened during the period, with cash and cash equivalents declining to N6.63 billion from N8.01 billion at the start of the quarter, as lending activities absorbed cash.
Cash flow from operations turned negative at N4.27 billion, largely due to increased loans and advances, underscoring the cash-intensive nature of the bank’s growth strategy.
Financing activities provided some support, with net borrowings of N2.75 billion during the quarter, partially offsetting operational outflows.
Shareholders’ equity stood at N11.72 billion, slightly lower than N12.38 billion at the end of 2025, reflecting dividend provisions and adjustments to retained earnings.
The bank proposed a dividend of 35 kobo per ordinary share and 7 kobo per preference share, amounting to over N1.5 billion, which has been classified as a liability pending approval.