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StanChart posts 44pc jump in first quarter after-tax profit

Standard Chartered CEO for Kenya and East Africa Lamin Manjang. PHOTO | FILE
Standard Chartered CEO for Kenya and East Africa Lamin Manjang. PHOTO | FILE 

The Standard Chartered Bank (StanChart) has announced a 44.4 per cent growth in its net profit for the first three months to March, lifted by increased interest income.

The Nairobi Securities Exchange (NSE)-listed lender booked an after-tax profit of Sh2.6 billion in the first quarter of the year compared to Sh1.8 billion in a similar period a year earlier.

“The first quarter performance has been strong reflecting good results from the actions taken during 2015 to improve income trends,” the bank said in a statement.

The jump in net profit is the largest among top-tier banks that have announced their first quarter results.

Equity Group posted a 10.7 per cent net profit growth in the first quarter to Sh4.2 billion, KCB Group grew by 12 per cent to Sh4.3 billion while Co-operative Bank booked a 29 per cent growth in net earnings to Sh3.17 billion.

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StanChart’s interest income grew to Sh6.4 billion in the review period from Sh5.4 billion despite the loan book shrinking by Sh5.4 billion to Sh109.7 billion.

“Customer loans and advances are down 4.6 per cent as we continue to focus on disciplined balance sheet management and more selective asset origination.”

Healthy returns

Customer deposits jumped by Sh12.5 billion to Sh184.5 billion.

The bank recorded a rise in gross non-performing loans to Sh15.4 billion from Sh8.3 billion in the period, but the loan loss provision remained almost flat at Sh728 million.

Its core capital increased by Sh1 billion to Sh34.2 billion.

“We have a strong capital base with a total capital ratio of 21.3 per cent. This positions us well to continue to take advantage of opportunities for business growth as well as making healthy returns to our investors.”

The growth comes after the lender reported a 39 per cent drop in its net profit for 2015 to Sh6.3 billion weighed down by decreased lending and a sharp rise in non-performing loans.

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