Stanchart Kenya’s Earnings Per Share Rise to Ksh 23.49 in FY2019

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Standard Chartered Bank Kenya on Thursday reported 1.70 percent marginal growth in net profit for the year ended December 2019 registering Ksh8.24 billion attributed to reduced interest expenses and provisions against bad debt.

Interest expenses dropped 22.40 percent to KSh5.8 billion, while loan loss provisions dipped 70.33 percent to KSh573 million.

“We have achieved important milestones on our strategic priorities in 2019. Our investments to transform the Bank digitally, develop and scale new business models, and build skills of strategic value to our clients continue apace,” said Kariuki Ngari, Chief Executive Officer.

“Key client digital adoption measures continue to improve – we have over 70 digital services and products on our mobile app, over 85% of transactions conducted through non-branch channels in Retail Banking, and close to 90% of our corporate clients are utilising our Straight2Bank platform,” he added.

According to Genghis Capital, the lender’s growth in profitability amid flat interest and non-interest income was below their expectations.

“Standard Chartered Bank of Kenya Plc (NSE: SCBK) announced a 1.7% y/y growth in FY19 EPS to KES 23.49, below our expectations of a 4.5% rise,” they said in the Earning’s note.

A final dividend of Ksh 15.00 was declared totaling to Ksh 20.00 which represents a dividend yield of 10.2% up from KSh19 in 2019.

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“Management has placed emphasis on the retail platform in what seems to be a gradual movement away from the corporate book. 

The bank launched its retail digital platform in March 2019 and the move to focus on the retail space could be in line with reducing the cost of funding, improving asset quality (corporate book has accounted for the bulk of NPL) and a drive for efficiency on digital platforms, which the bank has heavily invested in. 

Despite this, management has shown no indication of laying off its conservative strategy, which should curtail growth prospects for the bank, especially with the existence of more aggressive players in the retail segment,” commentary from Genghis Capital.