Standard Bank joint CEO Sim Tshabalala. Picture: FREDDY MAVUNDA
Stagnant GDP in SA means the lender is having to rely on its business in 20 other Sub-Saharan countries to compensate for rising costs and almost zero revenue growth in its biggest market. Kenya, Uganda and Ivory Coast are all expected to expand more than 6% this year and Standard Bank can do even better, says CEO Sim Tshabalala.
While the lender’s SA unit was able to accelerate cost-cutting initiatives and lending in the second half of 2018, it was not enough to offset other pressures, such as lower income from interest rates charged on loans. This resulted in expenses growth exceeding revenue growth, contributing to the lender missing analyst’s turnover estimates, and sending the stock down by the most in a month.
The lender’s rest-of-Africa business contributed 29% of adjusted earnings for 2018, compared with 26% a year earlier. Profit before one-time items in the segment jumped 26% excluding currency fluctuations, while adjusted earnings at its SA unit declined by 1%.
Is it because they are over charging their clients so much ?
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