Standard Chartered Bank has reported a profit of Sh5.2 billion in the six months ended June, up from Sh3.8 billion in a similar period last year.
This came as the bank announced that it had turned to buying government securities as it cut back on risky ordinary lending even as its half year net profit grew 34 per cent.
The bank’s loan book shrunk seven per cent to Sh114 billion from Sh123 billion over the same period, underlining its cautionary approach after its bad loans shot up 84 per cent to Sh15.3 billion.
Interest earned from the government increased by Sh1.6 billion to Sh4.7 billion being a 51.6 per cent increase compared to an 8.4 per cent growth in interest income from loans to Sh7.7 billion.
Its deposit base expanded to Sh190 billion from Sh163 billion, resulting to a 68.7 per cent increase in interest paid to customers to Sh2.7 billion.
StanChart’s liquidity ratio is one of the highest in the industry at 61.9 per cent against the statutory 20 per cent, with the lender opting to hold cash and treasuries rather than lend.StanChart management has recommended an interim dividend of Sh. 6 per share.