Standard Bank lukewarm on earnings growth

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Standard Bank lukewarm on earnings growth

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Published Date: 2018-04-25 | Source: Stephen Gunnion | Author: Stephen Gunnion

Standard Bank lukewarm on earnings growth

The bank says asset growth has been slow in South Africa and at its operations across the rest of the continent

Standard Bank says an improvement in business and consumer confidence hasn't yet translated into stronger asset growth in South Africa. And while the positive momentum in its retail customer franchise across the rest of the continent has continued, growth in non-interest revenue has been partially offset by slow growth in net interest income. That's also due to slow asset growth and declining interest rates. However, the group says a relatively benign credit environment has continued to provide support to banking earnings.

In a first-quarter performance update, Standard Bank says earnings from banking activities and other banking interests grew in the three months to end March. Group earnings were, however, dampened by the strength of the rand relative to the US dollar and the Argentine peso and weakness in key African currencies over the three months relative to the same period last year.

It says earnings attributable to the group from its 55.5% stake in Liberty Holdings are adjusted for the Standard Bank shares held by Liberty for the benefit of policyholders. The increase in Standard Bank's share price over the quarter had a negative impact on the earnings attributable to the group from Liberty in the period. Last year, they had a small positive impact.

The bank's share price rallied 12% in the first quarter of the year and declined by 5.3% in the first quarter of 2017. The stock closed 5% weaker at R213.93 yesterday.



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