Standard Bank Malawi has posted an after-tax profit of K13.4 billion (about $18.4million) in the year ended December 31 2015, a nine percent increase from the previous year’s K12.3 billion (about $16.4million) despite the tough economic environment.
The Malawi Stock Exchange (MSE)-listed bank said in a statement published on Friday accompanying the financial results that it posted “a good set of results” with total assets increasing by 20 percent over the same period last year.
Reads the report: “Loans and advances to customers grew by 68 percent due to the group’s continued focus on growing the asset book in spite of the high interest rate environment which prevailed during the course of the year.”
The report said the bank’s management continued to focus on a robust management and emphasis on recoveries on written off loans, which resulted in a net recovery of K673 million against a credit impairment charge of K2.4 billion during the same period last year.
According to the report, operating income during the period under review grew by eight percent owing a 35 percent growth in net interest income while non-interest income declined by 17 percent over the same period last year.
On the other hand, operating cost also grew by 24 percent where cost to income ratio for the year stood at 51 percent compared to 44 percent realised in the previous year on account of slow income growth from pressure on margins on the trading revenue.
Going forward, the bank predicts that the economy’s overreliance on rain-fed agriculture system will become a regular risk issue.
The financial institution has advised the country to diversify and exploit other available opportunities.
This will ensure that the country is food secure throughout the year and counter the shocks of drought and dry spells.
The directors have since recommended a final dividend K3 billion, representing K12.13 per share to be tabled at the banks’ forthcoming annual general meeting.
The bank has said it will endeavour to deliver superior customer experience and focus their resources on the segments and sectors that drive the growth of the economy.
“In 2016, the group will continue to focus on delivering a superior customer-experience through improved service and the introduction of new products and services,” said the report,” said the report