Standard Bank: Summary of Full Year Results

Lester Davids

4 hours ago3 min read

Trade Standard Bank with Unum Capital.

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Analyst's Disclosure: This summary was compiled using an A.I tool.

Overall Performance: Standard Bank Group reported headline earnings of R45 billion for 2024, with a return on equity (ROE) of 18.5%. This demonstrates solid growth and profitability across their banking, insurance, and asset management divisions.
Strategic Progress: The group confirmed they are on track to meet their 2025 strategic goals and targets, indicating successful execution of their planned initiatives.
Client Growth: The bank saw a 4% increase in active clients, reaching 20 million, primarily driven by growth in South Africa. Digital adoption also increased, with a 6% rise in digitally active retail clients in South Africa.
Regional Contributions: The South African franchise experienced double-digit earnings growth, while the Africa Regions division contributed 41% to the group's headline earnings, despite currency headwinds.
Africa Regions Performance: The Africa Regions portfolio, despite currency challenges, showed strong underlying growth, with a 22% increase in local currency earnings and a ROE exceeding 28%. Key contributors included Angola, Ghana, Kenya, and Nigeria.
Capital and Dividends: Standard Bank maintained a strong capital position with a common equity tier 1 ratio of 13.5%. The board declared a final dividend of 763 cents per share, bringing the total annual dividend to 1,507 cents per share, a 6% increase.
Sustainable Finance: The group is progressing well towards its sustainable finance mobilization target, having already mobilized over R177 billion since 2022, with R74 billion added in 2024.
Global Economic Context: In 2024, global inflation moderated, interest rates declined, and global GDP showed moderate growth. However, regional variations persisted.
Sub-Saharan Africa Environment: Sub-Saharan Africa saw varying economic conditions. While inflation trended down, it remained high. Interest rates were also elevated, particularly in West Africa, where currency weakness was prevalent.
South African Economic Conditions: South Africa experienced improved consumer and business confidence following the general elections and the formation of the Government of National Unity. Inflation moderated, and interest rates were reduced, supporting economic stability.
South African GDP: South Africa's real GDP growth was 0.6% for 2024, following a decline in the third quarter.
Global Economic Outlook: The IMF forecasts continued global GDP growth in 2025 and 2026, driven by moderating inflation and normalized monetary policy.
Africa Regional Outlook: Economic headwinds are expected to ease in Standard Bank's Africa Regions portfolio in 2025, with more stable currencies and improved economic performance.
South African Economic Forecast: South Africa's inflation is expected to remain within the target band, and interest rates are projected to decline further. GDP growth is anticipated to improve in 2025 and 2026.
2025 Targets: Standard Bank is focused on achieving its 2025 targets, including mid-to-high single-digit banking revenue growth, a marginally declining cost-to-income ratio, and a group ROE within the 17% to 20% range.
Post-2025 Strategy: Looking beyond 2025, the group aims to capitalize on Africa's development opportunities. They will focus on core business growth and strategic expansion in areas like energy, infrastructure, and private banking.
Medium-Term Targets (2026-2028): Standard Bank has set new medium-term targets, including headline earnings per share growth of 8% to 12% and a ROE target range of 18% to 22%.
Dividend Declarations: The board declared final dividends for ordinary and preference shares. Ordinary shareholders will receive 763 cents per share, and preference shareholders will receive varying amounts based on their share type.
Dividend Payment Details: The report provides detailed information on the last trading dates, ex-dividend dates, record dates, and payment dates for the declared dividends, including specifics for the different share types.
Tax Implications and Share Capital: The report outlines the tax implications of the dividends and provides information on the company's issued share capital, including the number and par value of ordinary and preference shares.

Previous Post: Getting Paid: For Active Traders, Standard Bank Delivers On The Long & Short Side

Standard Bank tested it's 200-day SMA, rebounded, and is now looking to break below this level again. We are going to have to see the price stabilize before considering a new buy long position. The move lower over the last few months is in line with our 15 August view: " Caution To New Longs" as well as our alert (12 November: Channel Check) which warned around a change of trend from neutral to bearish.

Original Posts:

Caution to New Longs > https://www.unum.capital/post/standard-bank-trading-at-multi-month-highs-here-s-what-the-data-says-thursday-15-august-2024

Channel Check (12-Nov) > https://www.unum.capital/post/channel-check-standard-bank

SBK Daily Chart at Friday's close: