Stanchart revenues reach historic P1bn mark
Mbongeni Mguni | Wednesday March 26, 2014 12:47
Unveiling the bank’s results for the year ended December 31, 2014 yesterday, Stanchart Botswana CEO, Moatlhodi Lekaukau said the bank had been able to navigate the challenging and competitive local operating environment to become the country’s second most profitable bank.
During 2013, Standard Chartered Bank Botswana (SCBB)’s interest income rose four percent year-on-year to P786.2 million, while fee and commission earnings jumped 23 percent to P225.8 million.
Operating income rose 11 percent to P1.01 billion, while pre-tax profits were 28 percent higher at P405.7 million. The bank posted 107.8 thebe in earnings per share compared to 93.5 thebe in 2012 and has proposed a 44.6 thebe final dividend.
“We have been hard at work and it has been a two-year journey of getting our business to where it is,” Lekaukau told media and analysts in a briefing yesterday.
“In the first year we were building, getting our teams together and our controlled environment ready to support the levels of growth.
“We believe we have the fundamentals in place, such as our risk environment, and we will continue the growth trajectory in 2014, adding impetus to it.”
One of these “fundamentals” underpinning SCBB’s success was what chief financial officer, Mpho Masupe, described as “careful monitoring and surveillance” of the loan book.
Of the listed banks that have thus far reported their results, Stanchart’s 57 percent drop in full-year year-on-year impairments is in comparison to Barclays’ 58 percent increase. First National Bank Botswana, which leads the country in bank profitability and balance sheet size, recorded a 13 percent drop in impairments for the six months ended December 31, 2013.
According to the bank’s results, impairments within the flagship consumer banking segment rose 25 percent, being in line with the 28 percent increase in consumer loans which were pegged at P4.7 billion by December 31, 2014.
“Loan impairments are one of our great stories,” said Masupe.
“We have a well controlled book not from just being cautious, but being careful about monitoring and looking after our loan book.
“We have a strong loan book and we have been able to diversify our consumer banking book from 85 percent personal loans to 75 percent by the end of the year.”
SCBB head of consumer banking, Duncan Woods told Mmegi Business: “We wanted to diversify our consumer loan book and the simplest way would have been to artificially slow down our personal loans.
“However, we instead continued to grow the book but stepped up the growth in SMME lending and mortgages.
“We have managed to achieve diversification without slowing down the book artificially which is what we are comfortable with.”
Mortgage lending within the SCBB’s consumer banking segment rose by 45 percent in 2013, while SMME lending - another consumer banking component - increased by 180 percent.
Besides speeding up its growth in consumer and wholesale banking in 2014, SCBB also plans to launch several products for the high value segment.