Stanbic shareholders get record dividend as profit hits Sh12bn

Stanbic Holdings has raised its dividend payout by 21.8 percent to Sh6.07 billion after the net profit for the year ended December 2023 grew by a third to hit the highest level in the lender’s history.

Net profit grew by 34.2 percent to Sh12.16 billion from Sh9.06 billion posted in the preceding year as the interest income and non-funded income increased.

The improved performance saw the Stanbic board recommend a raise in dividend per share from Sh12.60 to Sh15.35 in what will also mark the highest-ever payout in the history of the lender.

The raised dividend per share will see shareholders pocket a total of Sh6.07 billion or 49.9 percent of the net earnings compared with the previous year when it distributed Sh4.98 billion or 55 percent of its profit.

The directors of Stanbic on Tuesday recommended a final dividend of Sh14.20 per share, which will amount to Sh5.61 billion. This will add to the Sh1.15 per share interim dividend amounting to Sh454.6 million that was paid in September last year.

“Subject to shareholders’ approval, the final dividend will be payable to the members of the company registered on the share register of the company on the closure date, 17 May 2024,” said the lender.

During the review period, net interest income grew from Sh18.9 billion to Sh25.6 billion as loans and advances to customers rose from Sh266.83 billion to Sh356.2 billion at the end of December.

Non-interest income — mainly drawn from fees and commissions — rose from Sh13.14 billion to Sh15.67 billion, further supporting the growth in net earnings.

The group’s operating expenses, however, rose from Sh14.97 billion to Sh17.99 billion.

Stanbic becomes the first lender to release its 2023 full-year results, with others expected to do so before the end of the month.

The Nairobi Securities Exchange-listed lender’s 34.2 percent growth in net earnings is contrary to the trend that the sector is expected to realise at the end of the earnings season.

Central Bank of Kenya data shows Kenya’s banking sector pre-tax profits for last year dropped by 7.3 percent from Sh244.1 billion to Sh226.3 billion. This is in contrast with the previous year when pre-tax earnings rose by 25.3 percent from Sh194.8 billion that had been posted in 2021.