SH6.3BN

Business Daily (Kenya) - - FRONT PAGE - Charles Mwaniki [email protected]­tion­media.com

REV­ENUE

Stan­dard Char­tered Kenya’s net pro it for the nine months ended Septem­ber.

Stan­dard Char­tered Kenya’s net profit for the nine months ended Septem­ber rose by a third to Sh6.3 bil­lion on higher rev­enue from govern­ment se­cu­ri­ties, fees and com­mis­sions and a fall in pro­vi­sion for bad loans.

The top tier lender, which had made a net profit of Sh4.7 bil­lion in the cor­re­spond­ing pe­riod last year, cut its pro­vi­sion for bad loans by half, from Sh3.73 bil­lion last year to Sh1.88 bil­lion this year.

In­ter­est in­come from govern­ment se­cu­ri­ties went up by 15 per cent to Sh9.5 bil­lion even as the bank’s out­stand­ing stock of se­cu­ri­ties shrank by Sh10 bil­lion to Sh115.5 bil­lion, in­di­cat­ing a shift to higher-yield­ing bonds.

The lender how­ever saw a two per cent fall in in­ter­est in­come from cus­tomer loans to Sh9.9 bil­lion, con­tin­u­ing a trend that has hit a num­ber of banks this year due to a lower cap on rates and a pref­er­ence for govern­ment lend­ing. In­ter­est ex­penses rose marginally by two per cent to Sh5.76 bil­lion, while op­er­at­ing ex­penses fell by 6.7 per cent to Sh12.4 bil­lion largely due to lower pro­vi­sions for bad loans.

“Non-in­ter­est in­come in­creased by 10 per cent to Sh7 bil­lion com­pared to a sim­i­lar pe­riod in 2017 driven by good growth in fees and com­mis­sions, for­eign ex­change in­come and growth in our wealth man­age­ment busi­ness,” said Stanchart in a state­ment.

“In­ter­est in­come on cus­tomer

In­ter­est in­come from govern­ment se­cu­ri­ties went up by 15 per cent

loans and ad­vances de­clined by two per cent to Sh9.9 bil­lion due to lower av­er­age bal­ances cou­pled with re-pric­ing in line with the re­duc­tion of the Cen­tral Bank Rate while in­ter­est in­come from govern­ment se­cu­ri­ties in­creased by 15 per cent.”

The fall in loan loss pro­vi­sion con­tin­ues to pro­vide the base for banks’ in­creas­ing their prof­its in the nine month pe­riod, with fel­low top tier lenders KCB, Co­op­er­a­tive Bank, DTB and Eq­uity Bank all mak­ing sig­nif­i­cant re­duc­tions in their loan loss pro­vi­sions even as the stock of bad loans goes up.

THE LENDER SAW ITS PROF­ITS JUMP 34%

FILE

Stan­dard Char­tered Bank branch on Keny­atta Av­enue, Nairobi.

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