Stanbic Bank Kenya has reported a 4% decline in its full-year net profit for 2024, amounting to Ksh 39 billion. The decline is attributed to a contraction in its loan book, which fell to Ksh 230.32 billion. Despite this setback, the bank remains optimistic about a credit activity rebound in the second quarter of the year.
According to Stanbic Bank Chief Executive Officer Joshua Oigara, the lender anticipates an uptick in credit activity following the government’s planned payment of pending bills to the SME sector and a reduction in domestic borrowing. These measures are expected to improve liquidity and stimulate lending activities.
The bank’s financial performance was supported by increased transaction volumes and cost-cutting measures, resulting in an after-tax profit of Ksh 13.7 billion. However, customer deposits experienced a slight decline, dropping by 2.4% year-on-year to Ksh 339 billion, reflecting a cautious approach from depositors amid economic uncertainties.
Stanbic Bank has also raised concerns over the potential impact of the recent suspension of USAID operations by the US government. The lender warned that the move could negatively affect its subsidiaries’ operations in neighboring countries, where development funding plays a crucial role in economic activities.
Despite the profit dip, the bank has declared a dividend payout of Ksh 20.74 per share, reinforcing its commitment to delivering shareholder value. The dividend announcement signals confidence in the bank’s financial stability and long-term growth prospects.
Looking ahead, Stanbic Bank remains focused on leveraging digital banking solutions and expanding its service offerings to drive future growth. The expected resurgence in credit activity, coupled with a more favorable business environment, positions the bank for improved performance in the coming quarters.
While challenges such as reduced customer deposits and external economic uncertainties persist, Stanbic Bank’s strategic initiatives and prudent financial management could help navigate the evolving market dynamics. Investors and stakeholders will be keenly watching the bank’s performance in the second quarter to assess the impact of government fiscal interventions and global economic trends on its operations.
