StanChart Record 30.4% Profit Decline on Covid-19 Loan Defaults in 3Q20

StanChart Record 30.4% Profit Decline on Covid-19 Loan Defaults

Stanchart CEO Kariuki Ngari I Courtesy

Standard Chartered Bank reported a 30.4 percent dip in profit to Ksh 4.3 billion for the nine months to September 2020 due to loan default losses in the wake of Covid-19 pandemic.

The lender’s loan loss provision surged  3.7 times to KSh2.7 billion in response to gross defaults rising 10.2 percent to KSh21.9 billion.

However, investment in government and other securities grew 6.9 percent y/y (1.1% q/q) with the bank maintaining a very liquid balance sheet (65.7%).

“The NPL ratio still stands above the sector average of 13.1 percent and has remained elevated for the past 4 years. With the operating environment worse off due to the pandemic, we may see further weakening in the NPL ratio,”  Genghis Capital said in its commentary.

READ