Bank steps up focus

Standard Bank is focusing on clients, digitisation and integration in response to changing client expectations and new forms of competition, says CEO Sim Tshabalala.

At the presentation of Standard Bank Group results for the six months to June, where headline earnings increased 5% to R12.7 billion, he said the group welcomed increased competition, which, although uncomfortable at times, was good for the business and its clients.

But, he added, it is essential that new digital entrants fall within financial services rules and regulations.

The bank reported an improved return on equity of 16.8% (16.1%), creeping up to its target of 18% to 20%.

Banking headline earnings grew 6% to R11.7 billion, offset to some extent by a decline in other banking interests and Liberty’s contribution, although Liberty’s turnaround is on track.

Corporate and investment banking headline earnings were up 8% at R5.7 billion, and Africa headline earnings were up 20% to R3.8 billion, or by 32% in constant currencies, with a return on investment of 25.4%.

The group continues to gain clients in Africa outside South Africa, with active client numbers growing 4% to five million customers.

Tshabalala told Moneyweb Radio that the banking industry is “going through a seismic change”, where there is an accelerating trend towards use of electronic channels and less physical channels. He said the bank had suffered market share loss, but this had stabilised and it was now regaining market share.

Mobile transactions are growing at a high rate, resulting in reduced fees and commissions for banks.

Tshabalala said that if the Constitution clarifies how sustainable land reform and economic development are going to happen, “we will be in a better place”, especially if there is justice for land owners and those hungry for land.