[2008-08-12]  Stanchart Profit Rises By Sh24 Million
Standard Chartered Bank Kenya Limited has reported a 9 per cent increase in half-year pre-tax profit making it the first bank to record a single-digit growth in profitability.
The bank, which last year recorded a 21 per cent increase in its half-year pre-tax profit, only managed to record Sh24 million more than it did in the first half of 2007.
Results published in the dailies on Tuesday showed the bank's profit for the six months ending June 30, 2008 grew to Sh2,326 million up from Sh2,304 million recorded over similar period in 2007.
The bank's revenue base expanded by 6.6 per cent to Sh4.8 billion compared to Sh4.5 billion in the same period in 2007 driven by an increase in fees and commission and in forex income.
The bank recently increased its minimum lending rate to 15 per cent as it seeks to increase income earned from loans and advances. "The raising of interest rates by banks was inevitable as the situation in the market forced us to review our rates upwards.
It is a response to market fundamentals," said Mike Hart, Stanchart CEO for Africa when he presided over the ground breaking ceremony for the bank's new headquarters in Westlands.
Charges on loans and advances increased by 25 per cent from Sh191 million to Sh240 million while income from foreign exchange trading increased by 68 per cent to Sh911 million against the Sh542 million recorded in 2007.
The bank's loans and advances grew by 14.5 per cent to Sh45.4 billion up from Sh39.6 billion while customer deposits shrunk by 2 per cent to Sh73.5 billion from a high of Sh75 billion.
Ranked as the second most profitable bank in Kenya after Barclays Bank, at Sh4.9 billion pretax profit for 2007, Standard Chartered Bank is in the process of setting up new headquarters in Westlands. It will spend Sh2.3 billion on the new building which will serve as the bank's East African regional headquarters.
The headquarter will also act as the link between the African and Asian markets as the bank seeks to capitalise on the growing Africa-Asia business route.
Trade between the regions is on the rise with last year's trade figures totalling Sh8 billion with India, Japan, and Korea accounting for over Sh3 billion.
"The launch of this unit is an exciting initiative that will enable us to significantly enhance our service to clients operating in Africa and Asia," Mr Hart said.

Source: ALLAFRICA