•Profitability grew by 26percent bolstered by double digit growth in revenue and customer loans and increased operational efficiencies.
•Newly appointed Chief Executive signals a new business growth strategy
Stanbic Holdings defied a tough financial environment in 2022 to post a growth in net earnings from Sh7.21 billion in 2021 to Sh9.06 billion.
The improved performance saw the regional lender post a 26 percent increase in net profits for financial year 2022, to hit Sh9.1 billion.
The listed financial services provider, a member of Standard Bank attributed the 26 percent after-tax profit growth to strong revenue and balance sheet growth.
Buoyed by a diversified portfolio of corporate, commercial, investment and retail banking financial services, the lender posted a 28 percent revenue growth to close at Sh32 billion in the period under review.
This in turn saw the lender increase dividend payouts by 40 percent equivalent to Sh4.98 billion from Sh3.56 billion paid out in the last financial year.
Standard Bank Group East Africa regional chief executive Patrick Mweheire said that the lender has increased dividend payout despite the challenging business environment.
“We are extremely excited to be paying such a level of dividend. The operating environment remains challenging, but we are happy to see growth come back,” said Mweheire.
The results will see shareholders’ dividend per share increase to Sh12.6 up from Sh9 that was issued in the last financial year.
Stanbic's Chief Financial & Value Officer, Denis Musau said customer loans increased by 27 percent from the previous year registering Sh236billion.
“Over time, we have made investments to drive faster customer acquisition, efficient and convenient service and internal operational efficiency. The outcome of these efforts is evident in our Cost to Income ratio which reduced from 50.9 percent in 2021 to 46.7 percent in 2022,” said Musau.
Loans and advances to customers increased by 27 per cent to close at Sh236 billion.
The group’s operating expenses, however, rose from Sh12.7 billion to Sh14.97 billion, partly on near doubling of provisioning for non-performing loans from Sh2.5 billion to Sh4.98 billion.
The bank also recorded a reduction in cost to income ratio which reduced from 50.9 percent in 2021 to 46.7 percent in 2022, boosting its Return on Equity to 15.3 percent, up from 13.3percent in 2021.
Stanbic Kenya and South Sudan chief executive Joshua Oigara said the improved performance provides a good launch pad for the bank's next three-year strategy.
“Despite the uncertain and challenging operating environment last year, the business delivered strong results, thanks to focused execution across our strategic plan which is anchored on catalytic growth pillars such as customer service excellence and technology integration,” said Oigara
Customer deposits increased by 12 percent to stand at Sh272 billion, while loan and advances to customers were up 27percent to close at SH 236 billion.
Shareholders at the Nairobi Securities Exchange (NSE) listed firm will, subject to approval at the next Annual General Meeting, enjoy Sh4.98 billion.
This being 55 percent of the 2022 profit after tax.