Infinity Trust Mortgage Bank's Profit Rises 25% on Higher Lending Income

AFRICAN STOCKS AND FINANCEOctober 27, 2026 at 7:39 AM UTC

TLDR

Infinity Trust Mortgage Bank's nine-month profit after tax rose 24.95% to N2.61 billion.
The growth was driven by a 41.51% increase in turnover and stronger interest income from mortgage lending.
Higher funding costs and negative operating cash flow remain key considerations despite the profit growth.

Infinity Trust Mortgage Bank Plc reported increased financial performance for the nine months ended September 30, 2026. The mortgage lender's pre-tax profit rose by 26.94% to N2.76 billion, up from N2.18 billion in the corresponding period of 2025. Profit after tax also increased by 24.95% to N2.61 billion, compared with N2.09 billion a year earlier.

This growth in profitability was supported by a 41.51% increase in turnover, which reached N6.49 billion from N4.58 billion. Stronger interest income from mortgage lending activities and treasury operations primarily drove this expansion. Other mortgage loans and advances to customers remained the principal earnings source, contributing N4.16 billion to interest income. Net interest income also expanded by 43.55% to N3.70 billion, providing the main support for overall earnings growth.

The bank's balance sheet expanded significantly, with total assets rising by 44.66% to N54.87 billion from N37.93 billion in September 2025. Net loans and advances to customers increased by 46.48% to N36.69 billion, reflecting an expansion in the loan portfolio. However, funding costs also rose, with interest expenses surging by 78.2% to N2.19 billion. Operating expenses increased by 29.17% to N1.46 billion, while the bank recorded a net operating cash outflow of N5.80 billion.

These results highlight Infinity Trust Mortgage Bank's ability to grow profitability through increased mortgage lending and treasury income. For investors, the expansion in net interest income was sufficient to absorb higher costs, leading to improved pre-tax profit. However, rising borrowing costs and continued negative operating cash flow present important considerations regarding the quality of earnings. The bank's shares closed at N11.25 on October 26, 2026, on the Nigerian Exchange, having gained 60.71% year-to-date.

The bank's asset growth was mainly driven by increased loans and advances to customers and higher balances due from banks. On the funding side, debt issued and other borrowed funds increased significantly by N12.57 billion to N26.87 billion, coinciding with the expansion of the loan portfolio. While this supported asset growth, it also contributed to the higher interest expenses. Despite the strong reported earnings, the bank recorded a net increase in cash and cash equivalents of N2.71 billion, a 12.34% decrease from the previous year.

Key Takeaways

Infinity Trust Mortgage Bank's latest financial results, while showing robust profit growth, reveal a more complex underlying financial structure. The significant increase in interest income, particularly from mortgage lending, was the primary driver of profitability. However, this growth was accompanied by a substantial surge in funding costs, with interest expenses rising faster than net interest income. The bank's expansion in its loan portfolio and total assets was largely financed through increased borrowing, as debt issued and other borrowed funds climbed by 87.8% to N26.87 billion. This reliance on external financing, rather than customer deposits, contributed to the higher interest expenses. Furthermore, the bank continued to experience negative operating cash flow, with N5.80 billion consumed by lending activities, indicating that operational growth is highly cash-intensive. While net borrowed funds helped offset this outflow and supported an overall increase in cash and cash equivalents, the trend suggests a trade-off between aggressive asset expansion and the efficiency of cash generation from core operations. Investors may need to weigh the strong top-line and bottom-line growth against the increasing funding costs and dependence on external financing when assessing the sustainability and quality of these earnings.