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Standard Bank delivers sturdy results

Johannesburg - Standard Bank [JSE:SBK] turned in a solid performance in the last half year, reporting an 11% rise in profit.

The bank released its interim results for the six months to end-June on Thursday. It said the reported figures indicated a robust performance, underpinned by the group’s universal client offering, geographic diversity and increasing digital capabilities.

But it said currency movements adversely impacted the group’s results, reducing group headline earnings by 7% from the last reported period in December. The group’s headline earnings per share grew by 11% to 756 cents supporting an interim dividend per share of 400c, up 18% period on period.

The group’s South African branch, the Standard Bank of South Africa, grew its specific headline earnings by 18% despite adverse macro-economic developments, policy uncertainty and rating agency downgrades. While its asset and income growth was constrained, Standard Bank demonstrated resilience and grew its headline earnings on the back of good cost management and muted credit impairment charges, the bank said.

The bank said rates remained flat and inflation trended downwards, re-entering the South African Reserve Bank’s 3% to 6% target range. 

“Despite entering a technical recession and being downgraded by three rating agencies during the period, SA funding costs remained broadly flat and the ZAR strengthened on average against the major currencies period on period,” the bank said.

Gross loans and advances to customers grew by 1%, largely due to personal business banking loans which grew by 3% to R598bn. Positive commodity prices for much of the period boosted demand for loans from clients in the oil and mining industry, helping to lift its overall profit.

Standard Bank’s total income declined by 1% to R49 336m, mainly due to weaker non-interest revenue.           

Digital future

Standard Bank said it would continue to invest in digital capabilities and the re-skilling of our employees to improve its relationship with customers.

“We recognise that we are not where we want to be in terms of customer satisfaction and are making changes to ensure that we improve this going forward,” the bank said.

Its core banking replacement journey in South Africa and Africa regions remained on track to close by the end of the year.

“Although it has been a long and costly exercise, we remain of the opinion that it provides us with the resilient platform required to compete in a digital world,” it stated, adding that its innovation plans extend across analytics, robotics, cyber security and blockchain. 

Standard Bank shares were 1.85% up at R166.97 on the JSE at around 09:30.

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