[2008-08-14]  CFC partner banks on foreign interests to grow earnings
A difficult trading environment, including high interest rates and inflation, has forced Standard Bank of South Africa to rely increasingly on its foreign interests.

The bank, which owns 60 per cent of CFC through local subsidiary Stanbic Bank, is yet to reap from its recent merger which is expected to be influential in the long term.

In a teleconference from South Africa, the company said that African markets were proving to be a key strategic strength. In the half year results for 2008, the bank’s business in the rest of Africa grew by 55 per cent, while those outside Africa grew by 11 per cent. Total earnings outside of South Africa grew by 30 per cent.

South Africa Reserve Bank — the country’s central bank — has increased the benchmark interest rate 10 times to 15.5 per cent in June, making borrowing conditions quite tight.

In Kenya, policy benchmark interest rate is at nine per cent, though inflation is at 26 per cent. Chief executive Kacko Maree said Standard Bank’s business grew by a meagre one per cent in South Africa.

Source: Businessday