Standard Bank Group has reported a solid financial performance for the first half of 2024, underscoring its robust operational strategy and commitment to shareholder returns. The Johannesburg-based financial institution announced headline earnings of R22.0 billion, marking a 4% year-on-year increase, and an impressive return on equity (ROE) of 18.5%. This achievement is attributed to the bank’s expanding client base, increased digital adoption, and prudent capital allocation.
The group’s headline earnings per share rose by 4% to 1,329 cents, while the net asset value per share grew by 5% to 14,564 cents. Reflecting confidence in its continued growth and financial strength, the bank declared an interim dividend of 744 cents per share, an 8% increase from the prior period. Standard Bank also reported a commendable cost-to-income ratio improvement to 49.7%, alongside a reduction in the credit loss ratio to 92 basis points, highlighting enhanced operational efficiency and improved credit trends.
Sim Tshabalala, the Chief Executive Officer of Standard Bank Group, articulated that the performance is significantly driven by the ongoing franchise growth within its banking operations, coupled with robust earnings from its insurance and asset management segments. The South African franchise recorded double-digit earnings growth, bolstered by an improving credit environment, while the Africa Regions’ franchise continued to excel, contributing 41% to the group’s headline earnings, with strong performances in markets such as Angola, Ghana, Kenya, Mauritius, Mozambique, Nigeria, Uganda, and Zambia.
The bank’s capital position remains solid, as evidenced by its common equity tier 1 ratio of 13.5%. The declared interim dividend aligns with the bank’s strategic objective of balancing shareholder returns with capital preservation and growth investments.
Standard Bank’s commitment to sustainable finance was further exemplified by the mobilisation of over R21 billion in sustainable finance during the first half of 2024. The bank has set an ambitious target of mobilising over R250 billion in sustainable finance solutions by 2026, reflecting its dedication to driving positive environmental and social impact across the African continent.
The macroeconomic landscape in the first half of 2024 was shaped by global uncertainties and geopolitical tensions, with South Africa experiencing modest improvements in energy and logistics, partly driven by private sector initiatives. The May 2024 general election, which was widely regarded as free and fair, has bolstered market confidence, with expectations of accelerated policy reforms in the near future.
Looking ahead, Standard Bank remains cautiously optimistic. The International Monetary Fund (IMF) projects global GDP growth at 3.2% for 2024, with a slight increase to 3.3% in 2025. Within this context, Standard Bank forecasts a modest 1.1% growth in South Africa’s GDP for 2024, improving to 1.8% in 2025. The bank expects more robust growth in its sub-Saharan African portfolio, with GDP expansion outside of South Africa anticipated to exceed 4% in the short term and approach 5% in the medium term.
Sim Tshabalala reaffirmed the group’s strategic focus, emphasising that the bank’s strong capital position, combined with its diversified and resilient earnings streams, enables it to continue paying dividends while also investing in growth opportunities. Notably, the bank plans to increase investments in its subsidiaries in Angola and Nigeria, support growth in South Africa and East Africa, and play a leading role in Africa’s transition towards sustainable energy.
Standard Bank Group’s performance in the first half of 2024 underscores its ability to navigate an uncertain global environment, mitigate risks, and continue delivering strong earnings and attractive returns. The bank remains focused on achieving its 2025 targets and its ambitious sustainable finance objectives, ensuring continued value creation for its shareholders and other stakeholders.
