South African banker Sim Tshabalala-led Standard Bank targets Kenya, Ethiopia for future growth

Omokolade Ajayi -

Key Points

  • Standard Bank is focusing on expanding in East Africa, particularly Kenya and Ethiopia, to leverage the region’s rapid growth.
  • The bank aims for cautious, strategic growth through both organic development and potential acquisitions, emphasizing a strong relationship-building approach.
  • Despite challenges, the bank’s headline earnings rose by 4% to $1.22 billion for the first half of 2024.

Standard Bank, a Johannesburg-based financial services giant led by South African banker Sim Tshabalala, is intensifying its growth strategy across East Africa, focusing on Kenya and Ethiopia. This aligns with plans to bolster its presence in one of Africa’s fastest-growing regions.

In recent interim results presentation, Tshabalala outlined a strategic plan to enhance the bank’s footprint in East Africa, citing the region’s rapid expansion and its integration with major global economies such as China, the Gulf States, the United States, and the European Union as driving factors.

Cautious growth strategy in Kenya and Ethiopia

Standard Bank currently has a mid-sized corporate and investment bank, a developing business and retail bank, and an asset management arm in Kenya. As the third-largest financial services group in East Africa, Tshabalala acknowledged the bank’s relatively small presence in Kenya, which he described as “a giant in the East African community, growing at 5 percent.” 

The bank is pursuing a balanced approach to growth, focusing on both organic and inorganic opportunities without rushing into acquisitions. In Ethiopia, where Standard Bank has had a representative office since 2015, the focus is on cultivating strong relationships with local businesses, private clients, and regulatory bodies.

Strong earnings fuel expansion ambitions

As Africa’s largest lender by assets, Standard Bank operates in 19 African countries outside South Africa, including Uganda, Tanzania, the Democratic Republic of Congo, Kenya, South Sudan, and Ethiopia. With a market capitalization of $22 billion on the Johannesburg Stock Exchange (JSE), the bank remains a major player in the continent’s financial sector.

Under Sim Tshabalala, Standard Bank is enhancing its presence in sub-Saharan Africa and exploring new territories beyond the region. Despite facing macroeconomic and geopolitical challenges, the bank delivered a resilient performance in the first half of 2024, with headline earnings rising 4 percent to R22 billion ($1.22 billion) from R21.1 billion ($1.17 billion).

The expansion strategy continues amid legal challenges, including a setback in a home loan recovery case, and a new Memorandum of Understanding (MoU) with the African Union Peace Fund, demonstrating commitment to supporting peace-building initiatives across the continent.