Standard Chartered Bank reported a profit of Rs. 13.132 billion in 2020 which is Rs. 2.8 billion or 21% less than the profit of last year which stood at Rs. 16 billion. The bank’s earnings per share also reduced to Rs. 3.39 from Rs. 4.14. Overall revenue grew 5 percent and client revenue increased by 15 percent year on year despite a significant reduction in interest rates and economic uncertainty due to the pandemic. Costs remained well managed and increased by only 4 percent year on year. The bank continued to follow a prudent risk approach and booked a loan impairment charge of Rs. 4.9 billion. The risk environment remains heightened and the bank will continue to monitor the portfolio given uncertainties surrounding COVID-19.
On the advance side, the portfolio declined 15 percent year on year, due to the slowdown in economic activity which impacted credit demand. Standard Chartered’s balance sheet is well capitalized and liquid and is positioned to leverage the opportunity from the resumption in economic activity. With a diversified product and client base, the bank will continue its strategy to build a profitable, efficient and sustainable portfolio.
On the deposits side, it achieved another milestone, with the highest ever growth of Rs. 91 billion, as total deposits crossed Rs. 550 billion. At year-end, total deposits closed at Rs. 557 billion with a growth of 20 percent, whereas current and saving accounts also grew by 19 percent from the start of the year and are now 93 percent of the deposit base.
The optimal funding structure of the balance sheet continues to support the bank’s performance. In 2020, the bank contributed around Rs. 12.9 billion to the national exchequer in lieu of direct income taxes, as an agent of the Federal Board of Revenue (FBR) and on account of FED/Provincial Sales Taxes. For the year 2020, the Board of Directors recommended a cash dividend of 27.5 percent (Rd. 2.75 per share).
Commenting on the results, Mr. Rehan Shaikh, Chief Executive Officer, Standard Chartered Bank (Pakistan) Limited said,
I am delighted to announce that the Bank has performed well in 2020, delivering a profit before tax of Rs. 23.6 billion. Our results demonstrate our strong business fundamentals. Having strengthened our foundations on controls and conduct we are well equipped to manage our risks, capital and liquidity effectively. The prudent and proactive measures that we are taking now will make us leaner and fitter to take advantage of the opportunities that lie ahead. As we move forward, we will increase our investments in further strengthening our digital infrastructure. These investments will be the fuel for our engine of growth in the future and will drive transformative change in the way we acquire, service, and deliver products to our clients.
I had been banking with SCB since 2012 but left SCB due to its staff insulting behaviour and working style like Govt employees….