Standard Bank Group has reported a robust financial performance for the first half of 2024 (1H24), with headline earnings reaching R22 billion and a return on equity (ROE) of 18.5%.
Both headline earnings and headline earnings per share climbed 4%.
This bank pointed to organic growth across its client franchises and a continued emphasis on digital transformation and prudent capital management.
“In 1H24, Standard Bank Group delivered earnings of R22 billion and a return on equity of 18.5%. This result is underpinned by strong organic growth driven by our growing client franchises, our increasingly digital clients, and our continued diligent allocation of capital,” said Sim Tshabalala, group chief executive officer.
Standard Bank said it demonstrated resilience in a difficult economic environment, with franchise growth evident in both banking and insurance sectors.
Active clients grew by 5% to 19.5 million, supported by significant expansions in both South Africa and the broader Africa Regions.
The bank's digital transformation strategy also paid off, with a 7% increase in digitally active retail clients in South Africa.
The South African franchise showed double-digit earnings growth, buoyed by improving credit trends.
Meanwhile, the Africa Regions franchise contributed 41% to the Group’s headline earnings, with significant contributions from key markets such as Angola, Ghana, and Nigeria.
The bank maintained a robust common equity tier 1 ratio of 13.5%. Reflecting confidence in the bank’s ongoing performance, the Standard Bank Group board approved an interim dividend of 744 cents per share, an 8% increase compared to the previous period.
The bank said it remains committed to making a positive impact through sustainable finance. In 1H24, the group mobilized over R21 billion in sustainable finance, bringing the total to R127 billion since 2022.
This trajectory places the bank well on its way to meeting its target of mobilising over R250 billion by the end of 2026, reinforcing its role in supporting Africa's just energy transition.
The first half of 2024 was marked by global economic uncertainty, with geopolitical tensions and slower-than-expected declines in inflation impacting markets.
In sub-Saharan Africa, various countries faced economic challenges, with inflationary pressures and currency fluctuations leading to interest rate hikes in several nations, including Kenya and Nigeria.
In South Africa, the economic environment showed signs of improvement, particularly in energy and logistics sectors. The country’s May 2024 election, deemed free and fair, resulted in the formation of a Government of National Unity (GNU), which has been positively received by markets, with expectations for an accelerated policy reform agenda.
Looking ahead, the International Monetary Fund (IMF) has maintained its global GDP growth forecast at 3.2% for 2024 and 3.3% for 2025.
In South Africa, inflation is expected to moderate, potentially paving the way for interest rate cuts, which, alongside ongoing policy reforms, could support economic growth.
Standard Bank Research anticipates a gradual improvement in South Africa’s GDP growth, with predictions of 1.1% in 2024, rising to above 2.0% by 2026.
The bank said it is well-positioned to manage uncertainty and capitalize on growth opportunities across its diverse portfolio, particularly in high-growth markets outside South Africa.
The group’s strong capital position and diversified earnings streams provide it with the flexibility to invest in growth opportunities and deliver sustained value to shareholders, it said.
“We are focused on delivering against our strategic priorities and remain on track to deliver on our 2025 targets, as well as our ambitious sustainable finance targets,” Tshabalala said.
Shares are up some 15% over the past year, to R219, with a P/E Ratio of 8.31.
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