Standard Chartered loss provision triple, profits drop 31%

 

Standard Chartered Bank Kenya’s loan loss provision more than tripled in nine months ended September 30 to cover for customers struggling to repay credit as coronavirus muzzle economy.

According to the lender’s financial results issued Thursday, loan loss cover rose to Sh2.7 billion in the quarter under review compared to Sh728 million in the corresponding quarter last year.

Its net earnings shrunk 30.6 per cent to Sh4.3 billion from Sh6.2 billion in 2019, continuing the downwards trend shown by other tier on lenders including Equity Bank, KCB and Co-op Bank who have also recorded a drop on Covid-19 related challenges.

The lender’s total interest income from loans to customers, investment in government paper and deposits held with other financial institutions, was down to Sh17.9 billion during the quarter compared to Sh19.1 billion recorded in Q3, 2019.

The lender’s pre-tax profit declined to Sh6.6 billion from Sh9.1 billion in Q3, 2019 while earnings per share declined to Sh11.13 in Q3, 2020, from Sh16.15 in the prior period.

However, its balance sheet grew in size from Sh290.6 billion to Sh314.4 billion during the period under review.

Loans to customers also rose from Sh118.5 billion to Sh131.7 billion, pushing up interest earned to Sh227.2 billion from Sh207.4 billion over a similar period last year.

According to Standard Chartered Bank Kenya CEO Kariuki Ngari, the lender Bank delivered resilient performance despite the extraordinary external environment.

‘’Customer deposits grew eight per cent  8 whilst loans  advances have grown 11 percent as we continue to support our clients,’’ Kariuki said.