Wesbank

Stan Chart profit jumps 68%

SHARE   |   Monday, 27 March 2017   |   By Kabelo Adamson
Stan Chart profit jumps 68%

Standard Chartered executive management on Friday told stakeholders that the bank has the capacity for further growth as the business is fit for progress, buoyed by what they say is strong financial results for the 2016 financial year. Moatlhodi Lekaukau, the outgoing bank Chief Executive, stepped up the podium to present the bank’s financial results for the last time as he will be leaving next week. He leaves a proud man on the back of solid results for period under review, with profit having gone up to P79.7 million. Lekaukau declared that once again growth was driven by the retail side of the bank which he said remains the engine of the bank. The group’s performance in 2016 grew by 3 percent on income and the business performance is said to have been impacted by a once-off significant impairment charge in Retail Banking. Profit before tax increased by 51 percent and the bank says it has made a number of marquee transactions, strengthened relationships with sovereigns and parastatals and identified opportunities to connect pool of capital with financing demands across the market. This is despite the retail side of the bank suffering a huge impairment due to the liquidation of BCL Mine with total impairments standing at P117.5 million, compared with P105.3 million from the previous year – a 12 percent increase.


The bank had cautioned its shareholders about the impact of closure of BCL on its financials as it had exposure to the fallen mining company together with its employees. The executives could not disclose how much it took a knock from BCL and employees but it is understood to run into over P40 million. Retail banking is said to have delivered with full year revenue up by 9 percent in spite of challenging credit environment. The bank during the year opened 20th outlet at Sir Seretse Khama Airport, a fully-fledged digital branch. The commercial banking business on the other hand realised 6 percent in revenue growth year- on-year. Loans and advances to customers have reportedly increased by 38 percent while deposits increased by 19 percent. Business in this sector is said to be looking good with continued investment expected to deliver better results into the future. The balance sheet is also strong and has over the period of last year grown by 6 percent, which the bank Chief Financial Officer (CFO) Mpho Masupe said is a good growth. Masupe echoed Lekaukau’s sentiments that the business is quite strong, well capitalised and basking on strong fundamentals. Though he is leaving the bank soon, Lekaukau said the group expects an exciting 2017 with new investments lined up, saying they have a healthy balance sheet to back up all this.