Standard Bank Plc has registered a 50% rise in its 2019 profit margins with an after-tax value of MK15.9 billion from MK10.6 billion in 2018, this according to a statement released at the company’s annual general meeting.
The meeting this year was held digitally as way of preventing the spread of Covid-19 through restrictions on gatherings.
A joint statement accompanying the 2019 Financials and signed by outgoing Chairman Dr. Rex Harawa and Chief Executive William le Roux, says the profit was due to an increase in net interest income.
“The Group’s profit above prior year was due to an increase of 12% in the net interest income, emanating from the growth of customer loan book which swelled by 32% year on year while financial investments grew by 18%,” says the statement.
According to the statement, Customer deposits grew by 6% which contributed to growth of interest earning assests.
However, the statement also points out that the growth in net interest income was subdued due to the declining net interest margins as a result of a decrease of the base lending rate in 2019 to 12.5% from 23% in 2018. Non-interest revenue grew by 3% as compared to the previous year.
The bank says its focus still remains on utilizing digital means to achieve customer satisfaction in a global world that seeks convenient and integrated financial solutions.
“We promise to deliver value to our clients while driving digitization to offer our clients and prospective clients a truly United Financial Services Organization (UFSO) experience.
This means our business units and corporate functions will work as an integrated whole to service our client’s financial needs in a seamless way,” the statement reads adding “We have therefore welcomed the digital revolution as one of our biggest opportunities.”
There was also a drop by 62% of credit impairments due to what the bank says improved mechanisms in managing credit products.
“The decline was due to the Group’s focus on robust credit risk management practices. The Group continues to place emphasis on loan recoveries previously written off.”
Standard Bank says it holds an optimistic outlook for the 2020 financial year.
“The Group expects macroeconomic stability to continue in 2020 on the back of a normal agricultural season that would lend support to the local currency and sustain low and stable inflation and interest rates,” reads part of the statement.
Among some of the notable highlights in 2019, Standard Bank was lead transaction advisor for the MK27.92 billion Airtel Malawi Plc.
Initial Public Offer (IPO) which to date is the largest IPO on the Malawi Stock Exchange and he first to use digital payment solutions for subscribing.
Around K458 million was channeled towards corporate social investment in health, education, environment and agriculture.
