Standard Bank flags lower earnings

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Standard Bank flags lower earnings

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Published Date: 2021-03-04 | Source: Stephen Gunnion | Author: Stephen Gunnion

Standard Bank flags lower earnings

The banking group says its 2020 profits could halve from a year earlier due to the impact of Covid-19.

Standard Bank will report a sharp decline in full-year profit when it publishes its annual results next week due to the impact of Covid-19 on its banking and insurance operations across the continent.

In a trading statement, the group said earnings per share (EPS) for the year to end-December would be between 45% and 55% below the 1,593.5c it reported in 2019 and headline EPS would be 40% to 50% down from the 1,766.7c previously reported.

While it provided no further details in yesterday's statement, in November it said trends highlighted in an October update had continued, including slower balance sheet growth, pressure on margins due to last year's spate of interest rate cuts, and elevated credit losses. However, it said it remained capital generative. At the time, it said it would review its capital position, the economic outlook, and latest regulatory guidance before deciding on a final dividend for the year.

The bank held back on paying an interim dividend after the Reserve Bank's Prudential Authority (PA) issued guidance advising banks to hold back on dividend payments and cash bonuses to senior executives in order to conserve capital due to the potential impact of Covid-19. However, last month the PA revised its guidance to allow for dividends as long as banks remained prudent with their capital.

Standard Bank's results are scheduled for release on 11 March. Its shares fell 1.2% to R135.96 yesterday.





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