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Sh5b profit for Standard Chartered

NAIROBI, Kenya, Nov 2 – Standard Chartered Bank recorded a Sh5.2 billion pre-tax profit in its third quarter marking a 41 percent increase in profitability compared to Sh3.7 billion in the corresponding period in 2008.

During the period under review, income rose 23 percent to Sh9.2 billion, compared Sh7.5 billion last year.

Commenting on the results, Stanchart Chief Executive Richard Etemesi said the bank continued to make good progress during the third quarter of 2009, building on the record income and profits posted in the first half of the year.

“We continue to benefit from the growth opportunities across our target market segments and our continued deliberate focus on capital and liquidity strength remains a source of competitive advantage,” he said.

The bank attributes its continued good performance to its strategy of building a long-term, sustainable business.

“We have a very clear strategy that is working well and has huge potential. In addition, we continue to focus relentlessly on the basics of banking, liquidity and capital management, credit risk management, cost control, efficiency and customer service. Finally, our investment in new technology has enabled us to manage our costs, improve efficiency, serve new customer segments and widen our customer reach,” Mr Etemesi said.

Total operating costs during the period went up five percent to Sh3.7 billion from Sh.3.5 billion, while net bad debt charge was up three percent from Sh291 million to Sh299 million.

Total non-performing loans, as a proportion of total loans, stood at 3.5 percent compared to 4.4 percent in 2008.

According to Mr Etemesi this remains one of the lowest in the banking sector in Kenya.

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Loans and advances grew by 18 percent to Sh48.4 billion from Sh41.1 billion as customer deposits grew by 18 per cent to Sh89.4 billion.

The improved performance comes with good news for shareholders with the bank recommending a second interim dividend of Sh2.50 per share.

This is after earnings per share increased by 46 percent from Sh9.03 per ordinary share to Sh13.21.

The bank anticipates continued stress and volatility in the economy due to the current drought, high food prices and high costs of fuel and other inputs that will continue to put the economy under enormous strain and slow down recovery.

Mr Etemesi however believes the bank is well positioned to weather the economic uncertainties as it continues to deliver strong and consistent financial performance in 2009.

“We also plan to continue on our journey to building a long-term sustainable business in Kenya,” he said.

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