Standard Bank profit rises 1% after costs offset interest income
Standard Bank Group, Africa's largest lender, said full-year profit rose 1% as higher costs countered an increase in interest income.
Net income climbed to R16.2-billion from R16-billion a year earlier, the Johannesburg-based bank said in a statement on Thursday. Earnings per share excluding one-time items increased to R10.65, beating the R10.32 median estimate of 13 analysts surveyed by Bloomberg.
Standard Bank, which operates in 18 countries on the continent, said higher interest rates and subdued consumer demand will keep growth in South Africa at 2.2% this year, below the government's forecast of 2.7%.
Growth in higher-margin unsecured lending and a repricing of mortgages in its home market helped boost interest income, the bank said.
"Competition is high in all the markets we serve and business operating environments remain challenging," Standard Bank said in the statement. "The group's capital and liquidity strength, together with our firm commitment to our strategy which includes the building of world-class information systems, provides substantial opportunity to elevate our return on equity" over the medium term, it said.
Return on equity was little changed at 14.1% compared with 14% a year earlier, the bank said. The bank plans to pay a total dividend of 533 cents per share, 17% higher than the 2012 payout.
Standard Bank has dropped 3.8% this year, making the stock the second-worst performer on the six-company FTSE/JSE Africa Banks Index after Capitec Bank Holdings.