Stanbic Bank has become the first bank to reinstate interim dividends after its net profit dropped 37% in the half year ended June to Ksh. 3.5 billion. The company declared a payout of Ksh. 1.7 per share or a total of Ksh. 672 million to be paid on September 27 to shareholders who will have registered by September 6th.
In May this year, Stanbic registered a 26.7% increase in Profit after tax to Ksh. 1.9 billion from Ksh. 1.5 billion recorded in a similar period last year.
Stanbic, KCB, Absa Bank and Standard Chartered suspended interim dividends in 2020 after years of steady mid-year payouts. The move was attributed to capital-preservation strategies that took hold in the wake of the economic damage caused by economic interruptions caused by the COVID-19 pandemic.
Stanbic’s new interim dividend is the highest in three years and comes on the back of the group’s profit rising 37% to Ksh. 3.5 billion in the half year to June from Ksh. 2.55 billion in a similar period last year.
The bank’s net interest income grew by 9.5% to Ksh. 6.9 billion on loan book growth and improved margins. Similarly, non-interest income mainly linked to fees and commissions on loans, increased 10.5% to Ksh. 5.48 billion.
“We have realigned our strategy to focus more on our customer needs through our client-centricity value proposition and providing innovative solutions that are empowering and blend in with their lifestyle,” said Charles Mudiwa, CEO at Stanbic.
The Central Bank of Kenya (CBK) data shows that banks’ pre-tax earnings in the five months to May 2021 rose by 42% to Ksh. 76.4 billion from Ksh. 53.9 billion posted in a similar period last year.
The recent easing of COVID-19 restrictions and rollout of COVID-19 vaccines has triggered a gradual recovery in the economy, prompting banks to boost lending amid repayment of defaulted loans.