HomeBusinessEntrepreneurStanChart Q1 net profit up 19pc to Sh2.4bn

StanChart Q1 net profit up 19pc to Sh2.4bn

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StanChart Q1 net profit up 19pc to Sh2.4bn


StanChart Kenya CEO Kariuki Ngari. PHOTO | DIANA NGILA

Standard Chartered Bank Kenya #ticker:SCBK net profit for the first quarter to March 2021 has grown 18.9 per cent to Sh2.39 billion helped by growth in non-interest income and fall in operating expenses.

Results released Monday morning showed net profit rose from Sh2.01 billion earned in a similar period last year, placing the lender on a recovery path from decade-low earnings in 2020.

“Our first-quarter performance was strong buoyed by positive business momentum leading to improved transaction volumes particularly in wealth management, low credit impairment charges and operating cost efficiencies,” said Kariuki Ngari, CEO StanChart Kenya.

Non-interest income rose 11 per cent to Sh2.48 billion to make up for the reduced net interest income.

Net interest income, which largely comes from loans and advances fell 2.8 per cent to Sh4.59 billion as the loan book shrunk by three per cent.

Operating expenses reduced by nine per cent to Sh3.68 billion, helped by reduced provisioning for loan defaults and lower spending on staff.

“Loan impairment declined by four per cent (to Sh413.2 million) reflecting the impact of improvements in the macroeconomic variables,” said Mr Ngari.

During the review period, staff costs declined by 5.2 per cent to Sh1.64 billion, reflecting the saving that has come on the back of the voluntary early retirement programme that cut the number of employees.

The lender last year spent Sh1.35 billion on the layoff programme, marking the seventh straight year of cutting staff numbers as more attention shifts to digital services.

The bank closed 2020 with 1,280 employees —a 117 drop from the previous year— highlighting the impact of continued job cuts as the lender deepens focus on digital banking.

Queues in banking halls have been on the decline, putting at risk customer-facing jobs such as tellers as lenders continue to respond to a significant shift in transaction preference.

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88E70B70D1Aa46A497A524Eca9E5C16A?S=96&D=Mm&R=G Stanchart Q1 Net Profit Up 19Pc To Sh2.4Bn
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