Standard Chartered Bank Kenya (SCBK.NR) has announced a significant 15% rise in its pretax profit for 2023, buoyed by a surge in loan income to customers. With the economic landscape showing signs of improvement both locally and globally, the bank’s leadership is optimistic about its prospects for 2024.
During a recent investor briefing, CEO Kariuki Ngari highlighted several macroeconomic factors contributing to the positive outlook, including a stabilizing Kenyan shilling, declining inflation rates, and the reopening of international debt markets for frontier economies like Kenya. “All these are encouraging signs,” Ngari remarked, pointing to the potential start of monetary easing in major economies as another boost to market sentiment.
The Kenyan shilling’s nearly 13% appreciation this year signals a promising trend that could lead to lower costs for basic commodities and energy, a welcome development after last year’s sharp depreciation. However, Ngari also voiced concerns over emerging geopolitical risks, particularly disruptions to international trade caused by attacks on cargo vessels in the Red Sea, leading to delivery delays and increased insurance costs for clients.
Despite these challenges, StanChart Kenya, a subsidiary of Standard Chartered PLC (STAN.L), has seen its net interest income climb by 32%, pushing its pretax profit to 19.6 billion shillings ($141 million). Chief Financial Officer Chemutai Murgor underscored the bank’s continued growth and its strategic pivot towards wealth management for affluent clients, a move aimed at diversifying revenue streams.
The bank’s assets under management saw a robust 25% growth last year, reaching 185.5 billion shillings. In addition to its focus on wealth management, StanChart Kenya has been embracing digital transformation, making it easier for customers to access services such as account opening and loan applications remotely. A testament to this digital push is the upcoming launch of a microlending product on its mobile app, designed to offer customers short-term loans for small amounts.
“This is what is powering the bank,” Ngari stated, emphasizing the role of innovation and digital services in driving the bank’s success. As StanChart Kenya navigates the complex economic environment, its blend of strategic shifts, digital innovation, and a favorable economic climate positions it for continued growth and success in the coming year.
