Why does a custom UIButton image does not resize in Interface Builder?

While this may not be quite what you're after - the background image does scale.

Try this:

[button setImage:image forState:UIControlStateNormal];
button.contentVerticalAlignment = UIControlContentVerticalAlignmentFill;
button.contentHorizontalAlignment = UIControlContentHorizontalAlignmentFill;

In Swift:

button.contentVerticalAlignment = .fill
button.contentHorizontalAlignment = .fill