Home » Mercia Geises-led Standard Bank Namibia posts $13.2-million mid-year profit

Mercia Geises-led Standard Bank Namibia posts $13.2-million mid-year profit

by Omokolade Ajayi

Namibia-based financial services group Standard Bank Namibia (SBN) Holdings Limited has posted N$189.3 million ($13.2 million) in profits at the end of the first half of its 2021 fiscal year, as earnings fell by 16.5 percent compared to 2020.

The group’s half-year profit was pressured downwards by the weak operating environment, coupled with a low-interest-rate climate, which impacted the group’s mid-year financial performance. Profit after tax declined by double digits compared with last year.

As a result of the low-interest-rate environment, SBN’s net interest income fell by 4.7 percent from N$630 million ($43.9 million) to N$601 million ($41.9 million) for the six months ending June 30.

The bank revealed that the repurchase rate by the Central Bank of Namibia, which sets the pace for its interest income, suffered a 2.75-percent decrease between February and April 2020. This was also combined with a negative growth in loans and advances in the period.

This negative endowment combined with increased operating expenses pressured the group’s earnings power in the first half of 2021.

SBN Holdings is the Namibia-based subsidiary of Standard Bank Group, a financial services conglomerate, headquartered in South Africa, with subsidiaries in 20 African countries.

The holding company is led by Mercia Geises, who was appointed to replace Vetumbuavi Mungunda, who resigned in April 2021.

Since its founding in 106 years ago, the financial services group has seen the number of its branch offices reach 63 across Namibia, while its asset base has reached a valuation of N$33.1 billion ($2.3 billion).

Aside from the decline in interest income, which pressured profits downward by 16.5 percent, the management said the group’s non-interest income fell by 2.7 percent to N$571 million ($39.8 million).

The decline in non-interest income was triggered by a 29.8-percent drop in other gains and losses on financial instruments due to a 2.75-percent decline in the repo rate* between February and April 2020. 

Despite the weak performance, the board of the Namibia-based group recommended an interim cash dividend of N$83.6 million ($5.8 million), which translates to a payment of N$0.16 ($0.01114) per share.

*Repo rate is the rate at which the central bank in a country lends money to commercial banks.

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