Stanbic half year profit up Ksh.3.5 billion, approves Ksh.1.70 dividend per share
Stanbic Holdings earnings surged by 34.6 percent to record Ksh.3.5 billion in six months to June 2021 compared to Ksh.2.6 billion that was recorded same period last year.
The rise in profitability has been attributable to improved operating income and lower costs.
Net interest and non-interest income rose by 9.5 and 10 percent respectively to Ksh.6.9 billion and Ksh.5.5 billion.
“The bank’s profit after tax was supported by double-digit revenue growth and improved credit losses. Net interest earnings grew by 9% on account of loan book growth and improved margins. The interest rates have relatively been muted with the benchmark rate maintained at 7% from last year.” said Chief Finance Officer, Mr. Abraham Ongenge.
This pushed total income up by 9.7 percent to Ksh.12.4 billion from 11.3 billion in June last year.
Credit impairment charges which dragged down the profitability of banks in 2020 have fallen by 15 percent to Ksh.1.5 billion from Ksh.2 billion signifying the normalization of non-performing loans (NPLs).
Nevertheless, Stanbic Holdings has marked a rare balance sheet contraction with the Group’s total assets shrinking to Ksh.329.5 billion from Ksh.361.5 billion.
- Stanbic Holdings records a 13.4 p.c dip in full year pretax profit
- Stanbic November 2019 purchasing manager’s index
- COVID-19 Third Wave beats down business growth to 9-month low
The contraction has been attributed to constrained lending with the bank’s loans and advances to customers falling by 11.7 percent to Ksh.207.6 billion from a higher Ksh.235.1 billion.
At the same time, deposits from banks and customers likewise shrunk to Ksh.260 billion from Ksh.287 billion.
Subsequent to the rise in profitability, Stanbic Holdings earnings per share improved to Ksh.8.86 from a lower Ksh.6.46.
Stanbic rolled out various solutions that have improved client experience and expediency while driving scale in the main market segment.
The solutions range from the flexibility to buy motor insurance in less than 10 minutes through the Stansure app, to real-time access to Foreign Exchange rates on mobile and digital lending on mobile apps which are also expected to contribute to the bottom line in the second half of this year.
“We started the year by repositioning our brand through a message of hope dubbed, ‘It Can be’. This message speaks to the commitment and support that drive us to deliver on our promise. We have realigned our strategy to focus more on our customer needs through our client-centricity value proposition and providing innovative solutions that are empowering and blend in with their lifestyle,” Said Stanbic Bank Kenya Chief Executive, Mr. Charles Mudiwa.
The lender’s directors have recommended the payment of an interim dividend of Ksh.1.70 per share to be paid latest on September 27. This is after skipping the mid-year payout in June 2020.