Standard Bank Group has once again showcased its financial prowess, reporting impressive headline earnings of R22 billion and a return on equity of 18.5% for the first half of 2024. This success is fueled by an expanding client base, increased digital engagement, and strategic capital investments.
Financial Highlights:
- Headline earnings per share rose by 4% to 1,329 cents.
- Net asset value per share climbed 5% to 14,564 cents.
- Interim dividend per share increased by 8% to 744 cents.
- The common equity tier 1 ratio stands strong at 13.5%.
- The cost-to-income ratio improved to 49.7%, with a reduced credit loss ratio of 92 basis points.
Sim Tshabalala, CEO of Standard Bank Group, attributes this performance to robust growth in both their banking and insurance sectors. “Our South African franchise achieved double-digit earnings growth, supported by positive credit trends. Meanwhile, our Africa Regions’ franchise delivered outstanding results in local currencies. We are committed to leveraging opportunities across the continent to drive sustainable growth and deliver value to our stakeholders,” he stated.
Operational Achievements:
- Active clients increased by 5%, totaling 19.5 million.
- Digitally active retail clients in South Africa grew by 7%.
- The Africa Regions contributed 41% to the group’s headline earnings, with significant inputs from countries like Angola, Ghana, and Nigeria.
In terms of capital and dividends, Standard Bank maintained a robust common equity tier 1 ratio of 13.5% and declared an interim dividend of 744 cents per share, marking an 8% increase.
Sustainable Finance and Economic Outlook:
In the first half of 2024, Standard Bank mobilized over R21 billion for sustainable finance initiatives, with a target of over R250 billion by 2026. Despite global uncertainties and geopolitical tensions, South Africa saw improvements in energy and logistics, bolstered by private sector efforts. The May 2024 election, deemed free and fair, boosted market confidence and is expected to accelerate policy reforms. Looking ahead, the IMF forecasts global GDP growth of 3.2% for 2024 and 3.3% for 2025.
Standard Bank projects South African GDP growth of 1.1% in 2024, improving to 1.8% in 2025. For sub-Saharan Africa, excluding South Africa, GDP growth is expected to exceed 4% in the short term and approach 5% in the medium term. Tshabalala emphasized, “Our strong capital position and diversified earnings streams provide us the flexibility to pay dividends and fund growth opportunities, especially in Angola, Nigeria, and the East Africa Region.
We are committed to capturing a leading share of opportunities in Africa’s energy transition. “As the year progresses, Standard Bank remains focused on supporting clients, developing employees, and delivering sustainable growth and value to shareholders”. The bank is on track to meet its 2025 targets and ambitious sustainable finance goals, all while staying true to its mission of growing Africa, her businesses, and her people.
With a solid strategy in place, Standard Bank is well-equipped to navigate uncertainties and continue delivering strong earnings and attractive returns.
Researched by Tunde Ojediran.
Student intern, XGALogic Inc.
For 1stAfrika 2024.
