Stanbic Holdings shares surged to KSh 167.25 following a reported 12.8% increase in net profit to KSh 13.7 billion for 2024, up from KSh 12.2 billion in 2023.
The profit growth was primarily attributed to a significant reduction in loan loss provisions, which fell by 51.8% to KSh 3.1 billion. This reflects a decrease in credit risk, with the gross non-performing loan (NPL) ratio standing at 9.28%, below the industry average of 16%.
A final dividend of KSh 18.90 per share was declared, bringing the total dividend for 2024 to KSh 20.74, a 35% increase from KSh 15.35 in 2023. This represents a payout of 59.8% of net earnings.
Stanbic Bank Kenya contributed KSh 13.5 billion to the total profits, an 18% increase. However, the South Sudan subsidiary experienced a 63% decline in profits after tax, recording KSh 176 million, due to disruptions from the conflict in Sudan.
Despite a 3.8% decline in total income, driven by decreases in net interest income (down 5.1% to KSh 24.3 billion) and non-interest income (down 1.7% to KSh 15.4 billion), the bank achieved profit growth through cost management and reduced impairments. Operating costs decreased by 1.7% to KSh 17.7 billion.
Customer deposits decreased by 2.4% to KSh 339.01 billion, while customer loans decreased by 17.3% to KSh 294.7 billion, partly due to higher interest rates.
The newly launched unit trust business, Stanbic Asset Management, reached KSh 2.45 billion in assets under management within six months. Subsidiaries SBG Securities and Stanbic Bancassurance reported profits of KSh 20 million and KSh 174 million, respectively.
Stanbic’s CEO, Dr. Joshua Oigara, highlighted the bank’s focus on platforms, solutions, and stakeholder value.
“Our investments in technology, talent, and innovative business strategies have positioned us to deliver resilient earnings and create a positive impact across Kenya and South Sudan. “
CFO Dennis Musau emphasized the bank’s strategy of shielding customers from high credit costs and maintaining operational efficiency.
“This helped not only grow our average lending through the period but also keep credit defaults and impairments below industry levels. Our continued focus on extracting efficiency from our operations continue to bear fruits as evidenced by the 2% overall reduction in operating costs.”
The bank also advanced its sustainability commitments, including funding for MSMEs and green financing. Fitch Ratings affirmed Stanbic Bank Kenya’s Long-Term IDR at ‘B’ with a Stable Outlook.
