Standard Chartered half-year profit falls to Ksh.3.2 billion

Standard Chartered Bank of Kenya has announced a 31.9 per cent dip in earnings through the first six months of the year to Ksh.3.2 billion.

The drop in earnings from Ksh.4.7 billion last year is largely attributable to lower earnings from operations along with higher provisions on expected credit losses.

The bank’s net interest income declined by 4.1 per cent as interest income and non-interest funded income (NFI) declined by 6.3 per cent and 6.4 per cent respectively to Ksh.11.9 billion and Ksh.4.4 billion.

Weakness in the comprehensive income was observed from lower earnings from loans & advances, trading in government securities and thinner fees from lending and trading.

Standard Chartered loan-loss buffers meanwhile rose four-fold to Ksh.1.6 billion from Ksh.379 million last year with the lender following an industry wide conservative trend of high provisions in the face of adversities arising from COVID-19.

Standard Chartered Bank Chief Executive Officer Kariuki Ngari has however taken solace in the expansion of the lenders balance sheet as he remains optimistic of a near term bounce.

“Performance to June is muted but we are pleased with the outcome with customer deposits and assets both growing by 12 per cent from a similar position last year. We remain watchful as we get into H2 and aim to continue supporting our clients as they get out of the moratorium period and support the ongoing recovery of the economy as the country opens up for full business,” he said.

The bank said it has restructured Ksh.22 billion worth of customer loans including offering extension periods and loan repayment holidays.

Further, the lender says it has set aside Ksh.2 billion in funding to Small and Medium Enterprises (SMEs) and Ksh.650 million to commercial banking clients.

The bank stock of non-performing loans has surged marginally by 5.6 per cent to Ksh.20.9 billion in the period.

Standard Chartered Board has not declared an interim dividend for the period as it keeps a cash-preservation stance following its trimming of its annual dividend earlier this year.

The Group’s earning per share has declined to Ksh.9.17 from Ksh.13.46 last year.