Standard Chartered Bank Group has reported a decline in its half-year net earnings to KSh 3.2 Billion. This is compared to KSh 4.7 Billion posted over a similar period last year.
The Group’s unaudited results for the half-year period ended 30 June 2020 shows that the lender increased its loan loss provisions four-fold from KSh 378.9 Million to KSh 1.6 Billion.
Its non-interest income declined from KSh 4.7 Billion to KSh 4.4 Billion, comprising fees and commissions from loans to customers, which decreased from KSh 160.9 Million in H1, 2019 to KSh 152.5 Million at the end of June 2020.
Earnings from foreign exchange trading declined from KSh 1.6 Billion to KSh 1.5 Billion with Total Operating Income sliding to KSh 13.8 Billion from KSh 14.6 Billion.
Total Interest Income declined to KSh 11.9 Billion from KSh 12.7 Billion with interest on loans to customers falling from KSh 6.7 Billion to KSh 6.3 Billion.
Stanchart pre-tax profit stood at KSh 5.1 Billion from KSh 6.9 Billion in the 2019 half-year period while Total Comprehensive Income fell to KSh 3.9 Billion from KSh 5.2 Billion during H1, 2019.
The lender’s Earnings Per Share(EPS), which indicates its profitability declined to KSh 9.17 compared to KSh 13.46 in the first half of 2019.
Stanchart Group’s balance sheet size grew from KSh 294.5 Billion to KSh 327.2 Billion during the period under review with its loan book also increasing in size from KSh 120.1 Billion to KSh 134.3 Billion.
Customer deposits increased from KSh 228.5 Billion to KSh 256.5 Billion while what owners of the bank possess increased from KSh 46.9 Billion to KSh 51.7 Billion.
Financial analysts warn that the present challenging environment for banks is likely to continue for the remainder of the year.
This is as individuals and firms struggle to repay their loans, due to disruptions on business and incomes by the COVID-19 pandemic.
Depressed earnings of key lenders have been attributed to huge provisions made on present and future loan defaults.
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