Chronicle Editor
Business Reporter
FINANCIAL services institution, Stanbic Bank shrugged off the adverse impact of Covid-19-induced lockdowns to post an inflation adjusted profit after tax of $5,2 billion for the year ended 31 December 2021, up 185 percent from the $1,8 billion in the prior year.
The impressive set of results by The Standard Bank Group of South Africa subsidiary also saw it achieve a profit of $7,4 billion under the historical cost accounts, outpacing the prior period of $3,2 billion.
In a statement accompanying the results, Stanbic Bank chairman, Mr Gregory Sebborn, said the bank ended the year with a core capital of $11,3 billion, up from $3,8 billion in 2020.
This equates to US$103,7 million against the regulatory minimum of the local currency equivalent of US$30 million.
“The outlook remains somewhat uncertain due to currency instability, the Covid-19 pandemic and growing inflationary pressures,” he said.
“However, the bank will continue to ensure that strategies are in place to mitigate the possible negative effects of these factors.”
Stanbic Bank chief executive, Mr Solomon Nyanhongo, said year 2021 was difficult on account of Covid-19, which saw blanket lockdown conditions being introduced in the first two months of the year as the number of infections soared.
The lockdown conditions had an adverse impact on the level of business activity in the first quarter of the year.
However, the subsequent mild relaxation of lockdown conditions contributed positively to the recovery of the economy as most businesses were now able to operate with minimal disruptions, as the country’s vaccination level improved.
Mr Nyanhongo said this also contributed significantly to the bank’s positive performance, which saw the 2021 inflation adjusted net interest income surge by 206 percent from $2,7 billion in 2020 to $8,1 billion, largely underpinned by improved growth in the bank’s average interest earning assets from $11,7 billion to $34,1 billion as new lending assets and financial investments were acquired.
The bank recorded a 72 percent increase in its net fee and commission income, growing from $4,2 billion in 2020 to $7,3 billion.
“The relaxation of the lockdown conditions led to the uplift in the volumes of transactions, which were passing through our various service channels.
“However, the persistent foreign currency shortages on the foreign currency market impacted negatively on the level of trading activity resulting in depressed trading revenue,” said Mr Nyanhongo.
Online Reporter