Standard Bank Group (SBG), Africa’s largest bank with a 160-year track record of operational excellence and value has reported robust 2022 Annual result performance.
The Bank’s statement released today, March 9, 2023, reveals that the Group’s revenue growth as of 2022 was strong and well ahead of its cost growth which supported strong positive operating leverage and a decline in the cost-to-income ratio.
The Group’s credit loss ratio was at the bottom of the group’s through-the-cycle range and ROE improved to 16.4% from 13.5% recorded for 2021, closer to the 2025 target range of 17% to 20%. SBG’s Net asset value grew by 10%, with the Group ending the fiscal year with a common equity tier one ratio of 13.5%, which was 13.8% in December 2021.
As dividends paid out to its shareholders at the end of the fiscal years, the SBG board approved a final dividend of 691 cents per share which equates to a final dividend payout ratio of 60%.
Strong average balance sheet growth and margin expansion, due to higher interest rates, of the Bank supported robust net interest income growth. SBG’s larger client base, recovery in transactional and foreign exchange activity, as well as increased digital volumes, drove growth in net fee and commission revenue.
Furthermore, client activity within the fiscal year was observed to have increased, supporting trading revenue.
“Revenue growth exceeded cost growth, resulting in a decline in the cost-to-income ratio to 54.9% (FY21: 57.8%). Credit impairment charges increased by 22%, driven by higher corporate and sovereign-related charges, particularly related to Ghanaian sovereign exposures. The group’s credit loss ratio was broadly flat at 75 basis points (FY21: 73 basis points).”
SBG
Liberty Holdings Limited, a subsidiary of SBG’s operational performance improved. The business reverted from a net loss in the fall of 2021 to a profit of R2.1 billion.
“The Liberty minority buyout was successfully completed and the process of integrating Liberty into the group is well underway. While there is further work to be done, we remain confident that the full integration of Liberty into the group will create sustainable value for shareholders.”
Mr. Sim Tshabalala, CEO of the Standard Bank Group
Liberty Holdings Delivers Headline Earnings Growth of 26%
The South African franchise, Liberty, delivered headline earnings growth of 26% with ROE improving to 15.2% from as low as 12.5% in the 2021 financial year.
The Franchise’s revenue grew by 12% driven by balance sheet growth, margin expansion linked to higher interest rates, and a recovery in client activity to pre Covid-19 levels. Credit impairment charges also increased by 10% reflective of the difficult economic environment and deteriorating client trends. In sum, South Africa contributed 47% to the Group’s 2022 headline earnings. The Africa Region’s franchise delivered a robust performance, on the whole.
The SBG results reveal headline earnings growth by 36% and ROE improving to 21.0% compared to 18.2% recorded for the 2021 financial year. Revenue grew by 30%, driven by a larger balance sheet, higher interest rates, higher transactional volumes, a recovery in international trade, and strong growth in trading revenue, owing to the contributions of Angola, Kenya, Mozambique, Nigeria, Uganda, and Zambia. The aforementioned six (6) Africa Regions contributed 36% to the Group’s headline earnings in the 2022 financial year.
“In line with the group’s stated approach to support Africa’s just energy transition and its ambition to be the leader in sustainable finance on the continent, the group mobilized R55 billions of sustainable finance loans and bonds in FY22, more than doubling origination of these products in FY21.”
Sim Tshabalala
