Standard Chartered Bank, Kenya’s net earnings for the year ended December 31, 2021, grew 66.2 per cent as the economy recovered from the Covid-19 pandemic.
According to the financial results released yesterday, the lender reported a profit after tax of Sh9 billion, the highest in five years.
“2021 was an exceptional year for the bank despite the ongoing pandemic-driven challenging conditions with profit before tax improving 70 per cent,” said StanChart Kenya Chief Executive Kariuki Ngari.
According to Ngari, income returned to growth after the dip last year which was occasioned by the impact of the pandemic, increasing seven per cent with strong underlying business momentum.
Gross earnings rose by 70 per cent, the highest rate in five years, driven by lower costs and resilient income.
“We continue to transform how we serve our customers through innovations, partnerships and digitisation whilst maintaining a tight control on expenses with underlying efficiencies funding continual investment,” Kariuki said.
He added that loan loss provision was reduced as the bank worked closely with clients to support them walk through the pandemic.
The lender remained well capitalised during the period under review, with a highly liquid balance sheet, with a total capital ratio of 17.76 per cent and a liquidity ratio of 71 per cent, respectively.
Credit impairment declined 46 per cent to Sh2.1 billion, with the overall portfolio remaining stable and resilient.
The bank’s loan book grew four per cent to Sh126 billion compared to Sh121.5 billion in 2020.
Customers’ deposits also rose by a similar percentage to close the year at Sh265.5 billion compared to Sh256.5 billion.
While releasing the full-year earnings, Chemutai Murgor, the bank’s Chief Finance Officer (CFO) said the firm’s net interest income decreased two per cent to Sh18.8 billion compared to Sh19.1 billion in 2020.
Over the same period, the bank’s non-interest income increased by 25 per cent with strong performances in wealth management and financial markets.
Increased investment in transformational digital initiatives led to a 10-per cent drop in the firm’s operating expenses.
“Looking at our balance sheet, we are happy that it remains strong and highly liquid. The overall asset quality remained stable,” Murgor said.
Bank’s investors will also get Sh7.18 billion dividends after the lender raised the payout on the back of five-year high profits.
The lender said yesterday the board had proposed a final dividend payout of Sh14 per share to add to the interim payout of Sh5 per share that was in December 2021.