Corporate deals props Stanchart loan book
Keikantse Lesemela | Thursday August 14, 2014 11:23
Commenting in the published financial results for the half-year ended June 30, 2014, Standard Chartered chief executive, Moatlhodi Lekaukau, said their financial position continues to strengthen with loans to customers increasing by 27 percent to P7.1 billion. Adding to the good returns are deposits from non-bank customers that rose by 24 percent to P9.5 billion.
The bank introduced the new ‘One Bank’ strategy with a refined organisational structure that concentrates on retail clients and corporate and institutional clients. Lekaukau said this strategy has allowed the bank to bring more focus to specific client segments and appropriately serve their needs.
“The bank is already starting to realise some gains from this new development and is excited about the add value it will bring to our clients,” he said.
In the past year, Standard Chartered has established a footprint in the corporate financing market, particularly the diamond industry. Last November, the bank signed a $100 million deal to finance the Okavango Diamond Company. The loan, which was guaranteed by government, is one of the major corporate deals that Stanchart, has tied with both private and parastatal institutions.
“In the first half of 2014, the bank concluded a number of significant trade transactions, again demonstrating the strength of our capabilities and balance sheet,” said the CEO.
Last week, Parliament approved a government guarantee for a P300 million Standard Chartered loan to Botswana Meat Commission (BMC).
The bank has also recorded a13-percent increase in income compared to the first half of 2013. This was driven by strong performance from retail clients and increasing momentum from corporate and institutional clients segments, while trading profit showed a 21 percent year on year’s growth.
“Despite the low interest rate environment increasing pressure on margins, the business delivered strong balance sheet growth with loans and advances increasing by 27 percent and deposits also growing by 24 percent,” said Lekaukau.
He explained that retail clients continue to drive asset growth with good diversification of products.
“Personal loans are performing well, while other areas such as mortgage lending show a strong growth trajectory. The cost to income ratio has reduced by three percent to 54 percent as initiatives to contain costs continue.”
In this financial year the bank also reported that consumer banking delivered a strong performance as the department has introduced new strategy to give focus to key priority areas. In line with this strategy, the bank also developed its revenue diversification drive, launching an enhanced value proposition for the SME segment.