Standard Chartered has launched eight digital-only retail banks across key markets in Sub-Saharan Africa in less than a year. The bank’s second wave of digital-only bank launches is purely driven by increasing consumer demand for banking innovation.
Africa is prime for banking innovation — and the African banking market is the second-most profitable globally. The retail banking sector in Sub-Saharan Africa is now exposed to new business models as a result of low banking penetration and heavy use of cash.
Standard Chartered has digitised its wealth management offering for its digital-only banks platforms — and the number of accounts have risen by more than 150,000. Based on the bank’s Africa and the Middle East performance, it is reported that the underlying pre-tax operating profit of $684 million increased 29 percent and underlying operating income of $2.56 billion dropped 2 percent. However, the underlying operating income was 3 percent higher on a constant currency basis demonstrating good performance in the bank’s financial markets across the regions.
Although the bank’s performance in the Middle East and Africa market has reflected strong performances in financial markets and corporate finance, the results are offset by margin compression in retail banking and lower wealth management in the UAE. Its markets in the Middle East, North Africa and Pakistan remain flat, while Africa was down 3 percent. On the customer front, loans and advances increased 5 percent and accounts were down 2 percent.
Sunil Kaushal, Regional CEO, Africa and Middle East, said in a statement, “For Africa and the Middle East, we were well-positioned for growth moving into the year and this is clearly illustrated in our results. Our strong performance demonstrates the transformation of the Africa and Middle East franchise despite a challenging macroeconomic backdrop across the region.”
The bank’s global performance in the fourth quarter of 2019 reported that its pre-provision operating profit increased 8 percent to $4.9 billion. Its earnings per share rose 23 percent and asset quality remained stable. The bank’s credit impairment grew $166 million — and is still at a historically low level.
Standard Chartered has had a good start in 2020. Its regional operations are focused on driving its growth strategy — and is determined to help clients achieve prosperity, Kaushal concluded.