StanChart reports USD937Mn profit driven by higher income,disciplined cost management

Standard Chartered Bank released its Record Performance for the Bank in Africa and the Middle East (AME) in the Quarter 4 Financial Year 2022.Commenting on the results,Sunil Kaushal, Regional CEO, Africa and Middle East said: “In 2022, we achieved remarkable success as we advanced our transformation journey to recalibrate and restructure our network across Africa and the Middle East. Our outstanding financial performance is a reflection of the efforts and dedication of our team”.

“As we forge ahead to drive future growth, we are excited about the scale of opportunities across the region.Despite ongoing challenges, the GCC markets are expecting to outpace global growth on the back of oil recovery, increased government spending and bilateral trade negotiations. We remain committed to investing in our differentiated international network, our affluent client business and market-leading digitisation initiatives to help our clients achieve prosperity, as we continuously aim to be an industry leader across the region.” Sunil concluded.

Sunil Kaushal, Regional CEO, Africa and Middle East;{Photo/Courtesy}

AME – Performance Highlights

Underlying working profit of USD 937 million (up 25 per cent on constant currency basis) was driven by higher income and disciplined cost management. Underlying profit before tax of USD 819 million (up 4 per cent on constant currency basis) despite higher loan impairment that is primarily related to provisions for sovereign downgrades in Ghana & Pakistan.
Operating income of USD 2,606 million was up 7 per cent (up 14 per cent constant currency) driven by growth in Transaction Banking, Financial Markets and Retail. Income was up 9 per cent (up 15 per cent constant currency) in Middle East, North Africa, & Pakistan and up 3 per cent (up 13 per cent constant currency) in Africa.

Risk-weighted assets (RWA) were 17 per cent lower than December 2021, despite the impact of sovereign downgrades, due to continuing RWA optimisation activities and de-risking in markets with elevated macro-economic risk.

Loans and advances to customers were down 14 per cent (9 per cent down on constant currency basis) and customer accounts were down 8 per cent (3 per cent down on constant currency basis) since 31 December 2021.

Strategic priorities

Provide best-in-class structuring and financing solutions and drive creation through client initiatives
Invest to accelerate growth in differentiated international network and Affluent client businesses
Invest in market-leading digitisation initiatives in CPBB to protect and grow market share in core markets, continue with our transformation agenda to recalibrate our network and streamline structures
Be an industry leader in the transition to net zero across the region
Refocusing and simplifying our presence in AME

Progress

The Bank strengthened its footprint with the approval for a banking licence in Egypt
Led the AME bond and Sukuk markets in 2022, taking the top spot in the AME league tables and ranking #1 in MENA G3 issuance for the fifth year in a row. The commitment to ESG across DCM helped the Bank rank #1 in the AME ESG rankings where we doubled our volume and brought the year’s most innovative deals to market
On Sustainable Finance it brought new ideas to the market, and supported our clients with closing market firsts and landmark transactions that are creating a strong reputation for us amongst clients
SatnChart successfully launched end to end digital onboarding in Pakistan with embedded eKYC, allowing clients to seamlessly open accounts from the SC Mobile App. We have also expanded our agent banking proposition to 5 countries helping to drive financial inclusion by offering multiple touch points for clients to transact. We have expanded digital wealth management solutions in Kenya and UAE.
Broad-based growth in income across products, with Financial Markets at the highest level since 2015
Continuing cost discipline has allowed investments to continue through the cycle. CIR lower at 64 per cent (vs. 66 per cent in ‘21) and Revenue per Headcount has grown 11 percent vs FY’21.