Standard Bank posts higher net income

THE past year proved a better year for Standard Bank Namibia compared to 2003, as the bank realised a net income after taxation derived from banking and related operations of N$175,5 million compared to N$159 million of 2003, the bank announced in its annual report for 2004.

Total assets also increased by N$1,2 billion from N$6,6 billion of 2003 to N$7,9 billion in 2004, while total liabilities also went up to N$7,3 billion compared to N$6,2 billion of the previous period. However, other good news from the bank is that total shareholders’ funds went up to N$555,4 million from N$470,8 million of 2003.In his report, Standard Bank Namibia Board Chairman Dr Leake Hangala said banking in Namibia in 2004 was marked by a record strong local currency and stable exchange rate to its major trading partner currencies (mainly the US dollar and the euro), as well as declining and record low interest rates.”These main factors led to a decline in foreign exchange trading income and interest margin compression.”Consumer spending was not as high as would be expected in a low interest rate environment, consequently, private sector credit expansions grew slightly.Hangala said banks still continued to be plagued by uneven competition for retail deposits from tax-free returns available on unit trust investments as well as Treasury bills and Government bonds.On prospects for 2005, Hangala said further interest rate cuts and consolidation of foreign exchange rates were likely to continue, hence banks needed to find means of becoming more efficient and constrain cost growth.The bank has completed restructuring its vehicle and asset finance and says it is better positioned to take advantage of the expected increase in vehicle sales.Standard Bank Namibia Chief Executive Officer Theo Mberirua said there was promise of a better business approach from the institution this year as a result of a new, dynamic management team.However, other good news from the bank is that total shareholders’ funds went up to N$555,4 million from N$470,8 million of 2003.In his report, Standard Bank Namibia Board Chairman Dr Leake Hangala said banking in Namibia in 2004 was marked by a record strong local currency and stable exchange rate to its major trading partner currencies (mainly the US dollar and the euro), as well as declining and record low interest rates.”These main factors led to a decline in foreign exchange trading income and interest margin compression.”Consumer spending was not as high as would be expected in a low interest rate environment, consequently, private sector credit expansions grew slightly. Hangala said banks still continued to be plagued by uneven competition for retail deposits from tax-free returns available on unit trust investments as well as Treasury bills and Government bonds.On prospects for 2005, Hangala said further interest rate cuts and consolidation of foreign exchange rates were likely to continue, hence banks needed to find means of becoming more efficient and constrain cost growth.The bank has completed restructuring its vehicle and asset finance and says it is better positioned to take advantage of the expected increase in vehicle sales.Standard Bank Namibia Chief Executive Officer Theo Mberirua said there was promise of a better business approach from the institution this year as a result of a new, dynamic management team.