Financial results

Standard Bank Group produces solid results despite elevated levels of macro, political and policy uncertainty.

2016 year-end results (six months to 31 December 2016)

Standard Bank key results at a glance

  • Headline earnings: R23 009 million, up 4% 
  • Headline earnings per share (HEPS): 1 440 cents, up 4% 
  • Total dividend per share: 780 cents per share, up 16% 
  • Total capital adequacy ratio: 16.6% (2015: 15.7%) 
  • Net asset value (NAV) per share: 9 433 cents (2015: 9 433 cents) 
  • Return on equity (ROE): 15.3%, down from 15.6% in 2015 
  • Cost-to-income ratio: improved marginally from 56.5% to 56.3% 
  • Credit loss ratio: 86bps, in line with the 87bps recorded in the prior year

Standard Bank Group continued to grow its business both in South Africa and in our Africa regions franchise despite the elevated levels of macro, political and policy uncertainty experienced in many of the markets in which the group operates.

During the year under review our Africa regions franchise contributed 30% to the group’s total income and 25% to the group’s headline earnings.

The group’s banking activities headline earnings grew by 9% to R22 062 million and delivered an ROE of 16.8%, up from 16.3% in the prior year.

Our Corporate & Investment Banking division’s headline earnings grew by 16% to R10 558 million. Total income grew by 12% to R35 249 million, with client revenue growing by 10%, indicative of the resilience of our strong, diversified CIB client franchise. Our focus on multinational corporates is paying dividends and revenue from these customers contributed more than half our total revenues. Partnering with local corporates in their respective markets has resulted in a strong performance across our franchise with revenue from local corporates within the South African franchise growing by 18%. 

  • Global markets headline earnings growth was robust at 23% to R4 655 million while total income increased by 13%
  • Transactional products and services headline earnings grew by 17% to R3 073 million with total income at 19% higher than the prior year
  • Investment banking headline earnings increased 15% to R3 098 million with total income increasing 6% year-on-year
  • Real estate and principal investment management (PIM) recorded a headline earnings loss of R268 million

Sim Tshabalala, Standard Bank Group Chief Executive, commented: “We look to our clients, to the challenges and opportunities they may face, and seek ways to partner with them on their journeys in 2017 and beyond. As we focus on delivering market-leading client experiences, we continue to invest in our client-facing digital capabilities to enable our clients to transact independently and safely anytime anywhere.”

View our full year-end results

Operating environment

2016 was a tumultuous year. Globally, the ambiguity in the run-up to the UK's "Brexit" vote and the US election, as well as the contrarian outcomes, drove uncertainty and volatility. During the year, China’s policy stimulus continued and growth stabilised, providing some support to commodity prices, while OPEC's decision to trim output helped to lift oil prices. 

In sub-Saharan Africa, widespread drought in east, central and southern Africa continued, which placed strain on food supply and drove inflation. Oil-export reliant countries remained constrained on the back of low prices, and many countries tightened monetary policy in an attempt to control inflation. Despite these headwinds, the more diversified oil-importing east African countries continued to offer better macro prospects, attract investment and outperform. 

In South Africa, the threat of a sovereign downgrade by rating agencies to sub-investment grade persisted throughout the year. This in turn negatively impacted the already weak business and consumer confidence and further delayed much needed domestic investment and job creation opportunities. Politically driven actions added to uncertainty and heightened  international investor caution. Inflationary pressures brought about by the drought and the weak exchange rate placed additional pressure on already constrained consumers.

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