Standard Bank first-half profit up

JOHANNESBURG – South Africa’s Standard Bank Group Ltd increased first-half normalised headline earnings per share by over 25 per cent yesterday but said conditions would be tougher in the remainder of the year.

Africa’s biggest bank by assets said normalised headline EPS – the key profit measure for South African firms which excludes non-trading, capital and certain extraordinary items – rose to 451,1 cents in the six months to end-June as retail and corporate advances increased. Headline earnings increased 27 per cent to 6,165 billion rand, while net asset value per share rose 22 per cent to 39,04 rand.Shares in Standard Bank fell 2,85 per cent to 97 rand, underperforming a 1,93 per cent weaker JSE Securities Exchange banking sector.A Johannesburg-based trader said the results were in line with market expectations but added that the stock decline came amid a sharp sell-off on South African markets as fresh global credit concerns worried investors.”It is good results wasted on a bad market.The whole market is down, and there is a lot of arbitrage going on,” the trader said.Standard Bank said consumer demand was still growing but the growth rate was slowing after South Africa’s central bank raised interest rates by 250 basis points since June last year.The group said its credit impairment charge increased 62 per cent, while its credit loss ratio rose to 0,84 per cent from 0,7 per cent, and the non-performing loans amount was 46 per cent higher.Standard Bank said it expected operating conditions to be more challenging in the second half of the year.”This should result in the strong growth achieved in the first half moderating in the second half.”The company said net interest income had got a boost from strong asset growth, especially in personal and business banking, while loans and advances increased by 25 percent.Non-interest revenue rose 31 per cent to 11,54 billion rand.Standard Bank Chief Executive Officer Jacko Maree told an analysts’ presentation that the group planned to start a branch in India and expand its current representative office in the oil-rich southwestern African country of Angola to a bank.”If you look at the African continent, there are a couple of key economies where we are a smaller player and where we would like to be a big player,” Maree said.He said Nigeria, where Standard Bank had bought IBTC Chartered bank last month in a deal worth around US$400 million, was the most important market due to the size of the country’s population.Maree said Standard Bank also aimed to become a bigger player in Ghana, Kenya and Tanzania.Nampa-ReutersHeadline earnings increased 27 per cent to 6,165 billion rand, while net asset value per share rose 22 per cent to 39,04 rand.Shares in Standard Bank fell 2,85 per cent to 97 rand, underperforming a 1,93 per cent weaker JSE Securities Exchange banking sector.A Johannesburg-based trader said the results were in line with market expectations but added that the stock decline came amid a sharp sell-off on South African markets as fresh global credit concerns worried investors.”It is good results wasted on a bad market.The whole market is down, and there is a lot of arbitrage going on,” the trader said.Standard Bank said consumer demand was still growing but the growth rate was slowing after South Africa’s central bank raised interest rates by 250 basis points since June last year.The group said its credit impairment charge increased 62 per cent, while its credit loss ratio rose to 0,84 per cent from 0,7 per cent, and the non-performing loans amount was 46 per cent higher.Standard Bank said it expected operating conditions to be more challenging in the second half of the year.”This should result in the strong growth achieved in the first half moderating in the second half.”The company said net interest income had got a boost from strong asset growth, especially in personal and business banking, while loans and advances increased by 25 percent.Non-interest revenue rose 31 per cent to 11,54 billion rand.Standard Bank Chief Executive Officer Jacko Maree told an analysts’ presentation that the group planned to start a branch in India and expand its current representative office in the oil-rich southwestern African country of Angola to a bank.”If you look at the African continent, there are a couple of key economies where we are a smaller player and where we would like to be a big player,” Maree said.He said Nigeria, where Standard Bank had bought IBTC Chartered bank last month in a deal worth around US$400 million, was the most important market due to the size of the country’s population.Maree said Standard Bank also aimed to become a bigger player in Ghana, Kenya and Tanzania.Nampa-Reuters