Stanbic Bank Posts Ksh 5.2 Billion In Profits For 2020

Stanbic Holdings Plc has registered a profit of 5.2 billion shillings for the year 2020 reflecting the resilience amidst Covid-19 induced restrictions, subdued interest rates, weakening of the local currency, and increased regulations.

Stanbic was the first bank in Kenya to issue loan moratoriums for individuals, SMEs, and corporates, benefiting over 7,200 clients.  Stanbic focused on assessing how to stimulate the SME sector directly.

The lender restructured loans worth 40 billion shillings of which 3.1 billion shillings related to SMEs. Stanbic bore the costs of the restructures.

Through its insurance franchise, over 400 retrenchment claims were fully paid to assist clients to weather the challenges presented by COVID-19.  The Group waived charges on digital channels to the tune of 283 million in foregone fee revenue and lowered interest rate in line with regulations saving clients KES 665 million in interest thereby reducing the interest income for the lender.

The Group increased its provisioning to reflect the worsening credit risk on the back of layoffs and liquidity constraints on businesses caused by the pandemic. However, the Group maintained strong balance sheet growth as evidenced by a 12 percent increase in customer deposits and 4 percent growth in customer loans and advances.

Stanbic rolled out digital onboarding, allowing individual clients to open accounts remotely and transact at the convenience of their homes with 92 percent of accounts having been opened through this channel since the launch in the 3rd quarter of 2020.

The lender also made instant cash/salary advances available to clients digitally via the Stanbic App and USSD, issuing over 685 million shillings in loans via this digital channel.

Speaking at the announcement, Chief Executive of Stanbic Bank Kenya, Charles Mudiwa said: “Despite a challenging operating environment, I am proud that Stanbic stood shoulder to shoulder with our clients and the Kenyan community when it really mattered the most. We supported clients through our DADA proposition where we onboarded over 10,000 women while issuing loans worth KES 844 million to support them and their businesses.”

He added that: “Since the launch of the Stanbic Kenya Foundation, the Group has supported various efforts towards the national COVID-19 response. A key milestone was when we arranged one of the boldest strategic investments in Kenya’s private sector. Together with our partners, we collaboratively spent over KES 147 million in various Covid-19 relief interventions which included a donation of 192 ventilators to the Ministry of Health.”

The Group will continue to strengthen partnerships via the Stanbic Kenya Foundation, which has over the year, trained 500 entrepreneurs, completed financial fitness academies for 9 corporates training 681 individuals. The Group also recently announced a partnership with Microsoft dubbed the Digital Global Skills initiative geared towards imparting technical skills to the youth to enable them to participate in the global gig economy. Health is one of the key priority areas for the Foundation. In 2020, Stanbic distributed over 1000 hand-washing stations across Kenya to promote regular hygiene practice and facilitated over 3,000 free breast cancer screening sessions.

Sharing the Group’s outlook Mr. Mudiwa stated, “The COVID-19 pandemic, has given us a unique opportunity to live our purpose, we recognize the need for inclusive and sustainable growth and environmental sustainability. In a fast-changing world, we recognize the need to adapt to evolving risks, optimize resource allocation and drive returns. In doing so, we will leverage our core strengths, while seeking new ways to expand our offering and diversify our revenue streams further”.