Standard Chartered Bank profit falls by 18.7pc

StanChart CEO Lamin Manjang.

 

Standard Chartered Bank has posted 18.7 per cent decline in net profit in the first three months of 2017 as operating income dipped while costs went up.

While at a similar quarter last year, the bank posted a net profit of Sh3.7 billion, to reflect a reduction of Sh692.8 million to Sh3 billion. The bank now joins Kenya Commercial Bank, Cooperative Bank, NIC Bank, Stanbic Bank, Habib Bank, and Habib Bank AG Zurich in the growing list of lenders to record a drop in profits.

Financial statements for Standard Chartered Bank for the quarter up to March 30, 2017 show that interest income reduced by Sh68.9 million, while interest expenses went up by Sh180 million.

In what is becoming an industry trend in the first full quarter of capped interest rates, interest income from loans and advances by Lamin Manjang-led bank fell by Sh260 million or 6.7 per cent reflecting reduced spread on loans. However, interest income from investing in government securities went up by 4.5 per cent to Sh2.38 billion. The bank’s liquidity ratio was at 65.82 per cent against the minimum statutory requirement of 20 per cent. This was an increase of 5.15 percentage points.

In full year ended December 31, 2016, the bank’s net profit rose by 45 per cent from Sh6.3 billion to Sh9 billion supported by increased lending to government.