STANDARD BANK GROUP LIMITED - Unaudited condensed consolidated interim results for the six months ended 30 June 2017

Release Date: 17/08/2017 08:00
Code(s): SBK
 
Wrap Text
Unaudited condensed consolidated  interim results for the six months ended 30 June 2017

Standard Bank Group
Registration number 1969/017128/06
Incorporated in the Republic of South Africa
JSE share code: SBK 
ISIN: ZAE000109815
NSX share code: SNB ZAE000109815

UNAUDITED CONDENSED CONSOLIDATED INTERIM RESULTS AND DIVIDEND ANNOUNCEMENT 2017
FOR THE SIX MONTHS ENDED 30 JUNE

The Standard Bank Group Limited's (the group) condensed consolidated interim results, including the statement of
financial position, income statement, statement of changes in equity, statement of other comprehensive income and 
statement of cash flows, for the six months ended 30 June 2017 (results) are prepared in accordance with the 
requirements of the JSE Limited (JSE) Listings Requirements, the requirements of International Financial Reporting 
Standards (IFRS) and its interpretations as adopted by the International Accounting Standards Board (IASB), the 
South African Institute of Chartered Accountants (SAICA) Financial Reporting Guides as issued by the Accounting 
Practices Committee, financial pronouncements as issued by the Financial Reporting Standards Council, the 
presentation requirements of IAS 34 Interim Financial Reporting (excluding paragraph 16A(j) as permitted by the 
JSE Listings Requirements) and the requirements of the South African Companies  Act, 71 of 2008 applicable 
to summarised financial statements. 

The group's results are prepared in accordance with the going concern principle under the historical cost basis as
modified by the fair value accounting of certain assets and liabilities where required or permitted by IFRS. This report 
is presented in South African rand, which is the presentation currency of the group. All amounts are stated in millions 
of rand (Rm), unless indicated otherwise. The accounting policies applied in the preparation of these unaudited condensed
consolidated interim results are in terms of IFRS and are consistent with the accounting policies applied in the
preparation of the group's previous audited consolidated annual financial statements, except for changes as required 
by the mandatory and early adoption of the revised IFRS, as set out in the accounting policy elections and
restatement below. 

Interim results have not been audited or independently reviewed by the group's external auditors. The group's 2016
annual financial information has been correctly extracted from the underlying audited consolidated annual financial
statements.

1H17 refers to the first half year results for 2017. 1H16 refers to the first half year results for 2016. FY16 refers
to the full year results for 2016. Change % reflects 1H17 change on 1H16.

All amounts relate to the group's results unless otherwise specified.

The directors of the group take full responsibility for the preparation of this report.

The preparation of the group's results was supervised by the group financial director, Arno Daehnke BSc, MSc, PhD,
MBA, AMP.

The results were made publicly available on 17 August 2017.

This report contains pro forma constant currency financial information. For further details refer to pro forma 
constant currency financial information below. In terms of the JSE's Listings Requirements, the group no longer 
posts a physical copy of this announcement to its shareholders. Investors are referred to 
www.standardbank.com/reporting where a detailed analysis of the group's financial results, including an income 
statement and a statement of financial position for The Standard Bank of South Africa Limited, can be found. 

Shareholders are reminded that should they wish to make use of the group's electronic communication notification
system to receive all shareholder entitled communication electronically as opposed to delivery through physical mail 
and have not already done so, this option can still be elected by advising the group's transfer secretaries at 
the following email address edc.support@computershare.co.za or call +27 861 100 933. Other related queries can be 
sent to electroniccommunication@standardbank.co.za.

Highlights

- R12 111 million                       
  Headline earnings up 12%     
  1H16: R10 861 million                   

- 400 cents                          
  Dividend per share up 18%                  
  1H16: 340 cents                      

- 16.1%                           
  Return on equity                  
  1H16: 14.4%                       

- 56.3%                               
  Cost-to-income ratio                  
  1H16: 56.8%                           

- 756 cents                                   
  Headline earnings per share up 11%                  
  1H16: 680 cents                               

- 9 554 cents                               
  Net asset value per share up 2%                   
  1H16: 9 381 cents                           

- 13.7%                            
  Common equity tier 1 ratio       
  1H16: 13.2%                      

- 0.96%                            
  Credit loss ratio                  
  1H16: 1.05%                        


Overview of financial results 
Group results
Standard Bank Group’s (SBG or the group) results for the period ended 30 June 2017 were robust, underpinned by our
universal client offering, geographic diversity and increasingly digital capabilities. Headline earnings per share 
(HEPS) grew by 11% to 756 cents supporting an interim dividend per share of 400 cents, up 18% period on period. 
Group credit impairments and operating costs were well managed, resulting in an overall decline in the credit loss 
ratio from 105bps to 96bps and positive jaws of 1.0%. Group return on equity (ROE) improved from 14.4% to 16.1%. 
As at 30 June 2017, the group’s capital position remained strong with a common equity tier 1 (CET1) ratio of 13.7% 
(1H16: 13.2%). 

Currency movements adversely impacted the group’s reported results, reducing group headline earnings by 7% period on
period. On a constant currency (CCY) basis, group headline earnings grew by 19%, supported by Africa Regions which grew
by 46%. Despite the dilution impact from ZAR strength, Africa Regions still increased its contribution to banking
headline earnings to 29% and contributed positively to group HEPS growth and ROE. The top five contributors to Africa 
Regions’ headline earnings were Angola, Ghana, Mozambique, Nigeria and Uganda, which together represent c.60% of the Africa
Regions’ headline earnings. Against a backdrop of adverse macro-economic developments, policy uncertainty and rating agency
downgrades The Standard Bank of South Africa’s (SBSA) asset and income growth were constrained. Despite these headwinds,
SBSA demonstrated its resilience and grew its headline earnings 18% on the back of good cost management and muted credit
impairment charges.

Operating environment
In 1H17, global growth prospects firmed, supported by post-election optimism in the US and better than expected growth
in Europe and China. More specifically, China grew 6.9% in 2Q17, matching the robust momentum seen in 1Q17. Despite
better momentum, the stubbornly low inflation levels in key developed markets and slower than expected rate hikes provided
support to emerging market (EM) flows. EM markets, including South Africa, have benefited from the EM risk-on trade,
providing broad support to funding costs and currencies. This is best illustrated by the fact that despite entering a
technical recession in 1Q17 and being downgraded by three rating agencies during the period, SA funding costs remained
broadly flat and the ZAR strengthened on average against the major currencies period on period. The ZAR also appreciated
relative to all our key African Regions’ currencies over the same period; most notably the NGN, GHS and MZN. 

The challenges facing South Africa, namely low growth, high unemployment and high levels of inequality, are well
ventilated. During the period, despite business confidence levels remaining low overall, certain parts of the economy did
grow. The moderate recovery in commodity prices provided some support to miners. As the drought abated in certain parts of
the country, it provided much needed respite to parts of the agricultural sector. Consumers had an opportunity to catch
their breath as rates remained flat and inflation trended downwards. Inflation re-entered the South African Reserve
Bank’s (SARB) 3% - 6% target range in April and remained in the range for the rest of the period. Underlying credit growth
remained lacklustre, supported by low single digit real corporate growth whilst household credit continued to contract,
albeit at a slower rate. 

Across the 19 African countries in which we operate outside of South Africa, the dynamics continue to be diverse. In
the oil-export reliant countries on the west coast, such as Nigeria and Angola, prospects improved as oil recovered from
lows in 1H16. In contrast, foreign currency liquidity constraints continued for most of the period, depressing market
activity. East Africa suffered the effects of a drought. In Kenya specifically, the combination of the drought, the
effects of the regulatory caps and floors introduced in September 2016 and pre-election anxiety resulted in a slowdown in
credit growth. Mozambique’s currency, although weaker than in 1H16, stabilised in 1H17. 

The combination of higher rates, higher cash balances on the back of foreign currency liquidity constraints, flight to
quality and improved macros provided support for the Africa Regions’ performance. 

Revenue
Total income declined by 1% period on period to R49 336 million, driven primarily by weaker non-interest revenue 
(NIR) which decreased 7%. Net interest income (NII) increased 4% underpinned by net interest margin (NIM) expansion. 
NIM expanded 22bps to 394bps driven by higher average rates, loan pricing and funding margin. Total income grew by 
8% in CCY, supported by 11% growth in NII and 4% growth in NIR. 

NIR was impacted negatively by trading revenue which declined 19% in ZAR and 8% in CCY. Relatively lower volatility in
SA and in various Africa Regions’ markets reduced the opportunity to generate revenue. Despite recording strong growth
in Africa Regions (up 23% in CCY) and 4% growth in SBSA, group net fee and commission income declined 2% period on
period due to currency headwinds. Other revenue was broadly flat. 

Credit impairment charges
Declines in early arrears and non-performing loans (NPL) underpinned the decline in credit impairment charges period
on period, while coverage levels remained broadly flat overall. The credit loss ratio decreased marginally from 105bps to
96bps. In Personal & Business Banking (PBB), declines in early arrears, and portfolio provisions, were driven by continued 
improvements in collections, including early interventions. PBB’s specific impairment charges increased across card,
personal unsecured and business lending. Business lending charges increased following the migration of a few larger
exposures to NPLs in the period. Improvements in mortgages, as poorer vintages continue to roll-off, and vehicle and asset
finance (VAF), as the quality of the book improved, resulted in declines in the credit loss ratios for those portfolios.
Corporate & Investment Banking’s (CIB) impairment charges declined from elevated levels in the prior period, in particular, 
Africa Regions’ portfolio impairments. CIB SA’s portfolio impairment charges increased period on period. Coverage ratios 
increased across card debtors, personal unsecured and business lending as well as CIB portfolios in the current period. 

Operating expenses
Operating expenses declined 2% period on period driven by tight control on headcount, focus on discretionary spend and
favourable currency tailwinds. On a CCY basis, operating costs grew by 7%. Despite the challenging revenue environment,
the group managed to deliver positive jaws, in ZAR and CCY, in line with our strategic focus to reduce the
cost-to-income ratio. The cost-to-income ratio declined from 56.8% to 56.3%. 

In 1H16 the group recorded an operational loss of R300 million related to a fraud incident in Japan which did not
recur in 1H17. IT function spend decreased 3% in ZAR, as the R261 million increase in IT amortisation charge was more 
than offset by decreases in other IT spend. Certain USD licensing and maintenance costs were also lower once translated 
into ZAR.

Loans and advances
Gross loans and advances to customers grew 1% period on period, supported by PBB which grew by 3% to R598 billion
while CIB declined by 3% to R359 billion. On a CCY basis, Africa Regions’ PBB grew 7% and CIB declined 5%. As at 
30 June 2017, Africa Regions represented c.9% of the PBB portfolio and c.12% of the CIB portfolio. Although the PBB 
SA portfolio recorded low single digit growth overall, business lending grew 15% period on period in line with our 
strategic focus to grow in this business. On average, mortgage and VAF disbursements in SA amounted to more than 
R5.7 billion a month. CIB loans recorded a decline of 3% in ZAR and 1% in CCY basis, as trends seen in 2H16 
continued into 1H17. 

Capital, funding and liquidity
The group remains well capitalised with a CET1 ratio of 13.7% (1H16: 13.2%) and a total capital adequacy ratio of
16.2% (1H16: 15.9%). The group’s capital position remains strong and in excess of the group’s target ranges. In line 
with the group’s objective to optimise its capital stack, SBG successfully executed its inaugural Basel III compliant
Additional Tier 1 (AT1) bond issue in March 2017, raising R1.7 billion. The group will issue further AT1 subject to 
pricing and market conditions. The group continues to monitor a number of developments locally and internationally 
which could negatively impact the group’s capital ratios, most pertinent of which are IFRS 9 and the finalisation 
of the Basel III reforms. The IFRS 9 impact will be moderated by the removal of the capital deduction relating to 
the existing shortfall of credit provisions to expected losses, which amounted to R2.0 billion as at 30 June 2017. 

Deposits and current accounts from customers increased 4% period on period, and 8% in CCY. Retail-priced deposits
increased 6% in ZAR and 12% in CCY. The group remains focused on sourcing stable deposits from a diverse range of 
sources. The group’s established, on-the-ground franchises across our African footprint provide locally sourced 
deposits complemented by the USD and GBP funding raised through the group’s offshore operations in Isle of Man 
and Jersey. 

During the period, the group’s liquidity position remained strong and within approved risk appetite and tolerance
limits. Market cost of liquidity widened marginally during the period. As at 30 June 2017 the group’s quarterly average
Basel III liquidity coverage ratio (LCR) amounted to 116%, exceeding the minimum phased-in Basel III LCR requirement of 80%.
The group is appropriately positioned to meet the minimum Basel III net stable funding ratio requirements on 1 January
2018.

Gross loans and advances to customers                                                                          
                                           CCY1        Change            1H17           1H16           FY16    
                                              %             %              Rm             Rm             Rm    
Personal & Business Banking                   4             3         598 422        582 076        588 353    
Mortgage loans                                3             3         342 128        332 782        336 451    
Vehicle and asset finance                     1            (0)         80 889         80 929         81 035    
Card debtors                                  2             1          32 119         31 683         31 229    
Other loans and advances                     10             5         143 286        136 682        139 638    
Corporate & Investment Banking               (1)           (3)        359 486        370 822        360 336    
Corporate loans                              (2)           (5)        291 899        306 981        294 817    
Commercial property finance                   6             6          67 587         63 841         65 519    
Central and other                            56            56          (3 730)        (8 534)        (5 056)   
Gross loans and advances to customers         3             1         954 178        944 364        943 633    
1 Constant currency change.                                                                                    
                                                                                                
Deposits and current accounts from customers                                                                         
                                            CCY        Change            1H17           1H16           FY16    
                                              %             %              Rm             Rm             Rm    
                                                                                                               
Personal & Business Banking                   9             5         509 276        486 515        497 558    
Retail priced deposits                       12             6         412 022        389 910        401 497    
Wholesale priced deposits                     1             1          97 254         96 605         96 061    
Corporate & Investment Banking                7             4         623 208        598 024        616 601    
Central and other                             6             6          (3 870)        (4 121)        (4 413)   
Deposits and current accounts                                                                   
from customers                                8             4       1 128 614      1 080 418      1 109 746    
Comprising:                                                                                     
Retail priced deposits and                                                                      
current accounts                             12             6         412 022        389 910        401 497    
Wholesale priced deposits                     6             4         716 592        690 508        708 249    
Deposits and current accounts                                                                   
from customers                                8             4       1 128 614      1 080 418      1 109 746    
                                                                                                
Headline earnings by business unit                                                                           
                                            CCY        Change            1H17           1H16           FY16    
                                              %             %              Rm             Rm             Rm    
                                                                                                               
Personal & Business Banking                  15            11           6 109          5 523         12 748    
Corporate & Investment Banking               19            10           5 335          4 856         10 339    
Central and other                            (1)           (5)           (427)          (406)        (1 025)   
Banking activities                           18            10          11 017          9 973         22 062    
Other banking interests                    >100          >100             212              2             (8)   
Liberty (attributable to the group)          (0)           (0)            882            886            955    
Standard Bank Group                          19            12          12 111         10 861         23 009    


Overview of business unit performance
Personal & Business Banking
PBB’s headline earnings grew 11% to R6.1 billion and ROE improved from 16.5% to 17.7%. On a CCY basis, headline
earnings grew 15%. Credit impairments were flat on the back of improved collection strategies. PBB headcount 
declined 1% driven by PBB SA. PBB continues to grow the client base in its target segments, namely prestige 
and private banking as well as business banking. 

PBB SA’s earnings grew by 13% to R5.7 billion. Total income grew 6% supported by target customer growth and product
yield. Operating expenses grew 5%, delivering positive jaws. In line with our clear focus on client experience, staff are
being re-skilled, branch formats revised and rationalised and digital capabilities enhanced. Headcount, branch numbers
as well as branch size, all recorded declines in the period. Credit impairments declined 6% period on period. Ongoing
improvements in the mortgage and VAF performance were partially offset by a reduction in post write-off recoveries and a
deterioration in card and business lending. Wealth recorded an improvement in the product mix and pricing in the brokerage
and underwriting business as well as good asset growth. Wealth income was impacted by losses associated with the storm
and fire events in the Western Cape.

Results outside SA were impacted by relative currency depreciation. To better reflect the underlying trends, the
commentary below refers to movements in the PBB Africa Regions and PBB International businesses on a constant currency 
basis, unless indicated otherwise. 

PBB Africa Regions continues to gain momentum. Customer loans and deposits grew by 7% and 12% respectively, supporting
income growth of 11%. This growth was underpinned by a combination of an expanding active customer base in targeted
countries and an increasing adoption of digital banking. Active PBB customers increased by more than 10% in each of the
following countries: Kenya, Nigeria, Botswana, Mozambique and Tanzania. NII was supported by positive endowment in Nigeria
and Mozambique on cash management, savings and investment portfolios. Regulatory changes in Swaziland, Zimbabwe and
Malawi impacted fees. In 1H17 the credit loss ratio increased by c.44bps to 264bps, driven predominantly by increased
charges in Nigeria following an accelerated write-off of NPLs. Measured in ZAR, PBB Africa Regions earnings were 
materially impacted by the depreciation of the NGN period on period. 

PBB International’s headline earnings grew 41% supported by an 18% increase in the deposit base in GBP, margin
expansion and growth in the trust business. 

Collaboration with Liberty has been enhanced, with a focus on improving alignment of product development and sales
initiatives. Opportunities to better leverage the respective customer bases both in SA and in Africa Regions continue 
to be pursued.

Digital adoption continued to gain traction. PBB SA recorded close on 500 million mobile transactions, up 55% relative
to the prior period while ATM and teller volumes were down 5% and 15% respectively. Africa Regions recorded 100 million
digital transactions, up 47% period on period.

Corporate & Investment Banking
CIB’s headline earnings grew 10% to R5.3 billion and ROE improved from 17.8% to 21.4%. On a CCY basis, headline
earnings grew 19% supported by strong revenue growth, better credit performance and tight management of costs. 
CIB recorded targeted asset growth in the Consumer, Financial Institutions and Real Estate sectors. Due to the 
impact of currency, all growth percentages reported hereafter are on a CCY basis. 

NII grew 18% supported by higher customer deposits, an improved mix towards current accounts as well as positive
endowment. Fees increased 18% following improvements in client activity across the debt and equity capital markets 
business. Trading revenue declined by 5% due to a combination of compressed margins and lower volumes as a result of 
low market volatility. Total income grew 10% to R17.4 billion underpinned by CIB’s diversified and sustainable 
franchise, reflecting the successful deepening of client relationships. Tightly managed headcount and discretionary 
spend assisted in containing  cost growth. Operating costs increased 3%, delivering positive jaws of 7% and a lower 
cost-to-income ratio of 52.2%. 

The credit loss ratio to customers declined from 71bps in the prior period to 45bps, as prior period impairments on
specific names in SA, Nigeria and Ghana were not repeated. 

Global markets headline earnings declined 6% to R2.0 billion. Income growth was subdued at 2% due to lower client
activity and reduced market volatility across various countries, including SA. Liquidity shortages and regulatory
constraints impacted trading revenues in Nigeria, Mozambique and Uganda.

Transactional products and services headline earnings grew 67% to R1.9 billion. Total income was 20% higher than the
prior period due to continued good deposit growth and positive endowment underpinned by new clients gained. Impairment
charges declined from elevated levels in the prior year. Costs were well contained.

Investment banking headline earnings increased 18% to R1.4 billion. Total income increased 10%, mainly as a result of
strong fee and commission income growth from certain landmark deals concluded in the period. Despite a subdued macro
environment, loans and advances grew, supporting NII growth. The quality of the book improved, which was reflected in 
lower margins and NII growth. Impairment charges declined and cost discipline delivered positive jaws for the period.

Central and other 
This segment includes costs associated with corporate activities and servicing the group capital requirements, namely
the preference shares. The net headline loss for the period was broadly in line with the prior period. 

Other banking interests
Headline earnings from other banking interests increased from R2 million in 1H16 to R212 million in 1H17. The headline
earnings contribution from the group’s 40% stake in ICBC Standard Bank Plc (ICBCS) amounted to R48 million, a significant 
improvement on the R356 million loss recorded in the prior period. The headline earnings contribution from the group’s 
20% stake in ICBC Argentina declined 54% from R358 million to R164 million on the back of lower trading revenue, a weaker 
macro-economic environment in Argentina, higher impairments and a weaker Argentinian Peso. 

Liberty
The financial results reported are the consolidated results of the group’s 56% investment in Liberty, adjusted for the
group’s shares held by Liberty for the benefit of Liberty policyholders and treated as treasury shares in the group’s
consolidated accounts. Liberty’s normalised headline earnings for the period decreased 30% to R1.3 billion, driven, in
particular, by continued pressure in new business margins affecting Individual Arrangements and the performance of
STANLIB. Liberty’s IFRS headline earnings, post the impact of BEE preference shares and the Liberty Two Degrees listed 
Real Estate Investment Trust accounting mismatch, was 15% lower at R1.5 billion. Shareholders are referred to the full 
Liberty announcement dated 4 August 2017 for further detail. The impact of Liberty’s deemed treasury shares period on 
period amounted to R139 million. Liberty’s IFRS headline earnings attributable to the group, adjusted for the impact 
of Liberty’s deemed treasury shares, was R882 million, down slightly from the R886 million recorded in the prior period.

Prospects
Looking ahead, stronger global growth and firmer commodity prices should provide some support in 2H17. In July, the
IMF reaffirmed its outlook for global growth of 3.5% in 2017 and 3.6% in 2018. Global trade is expected to grow faster.
The EM trajectory is also favourable underpinned by supportive policy in China as well as broader infrastructure spend in
Asia. In sub-Saharan Africa, the macro environment is expected to continue to improve and interest rates to trend down
as inflation moderates. The IMF expects sub-Saharan Africa’s GDP growth to recover in 2017 and 2018, from a low of 1.3%
in 2016 to 2.7% and 3.5% respectively. More specifically, the GDP growth across our Africa Regions franchises is expected
to accelerate to 3.3% in West, 3.9% in South and Central and 5.9% in East in 2018. Nigeria’s economy is expected to
recover from a 1.6% contraction in 2016 to positive growth of 0.8% in 2017 and accelerate to 1.9% in 2018. In terms of
South Africa’s outlook, the expectations of a recovery in 2017 have moderated and the current SARB forecast is for 0.5%
growth for the year. The threat of further rating agency downgrades remains. Declining interest rates, in SA and in some 
of the countries in our Africa Regions, will be a headwind in 2H17.

In the period, we have successfully embedded the five value drivers of client focus, employee engagement, risk and
conduct, financial outcomes and social, economic and environmental (SEE) impact in the businesses. They underpin our
decisions and drive the group’s shared value outcomes.

Across our CIB franchise, we remain committed to partnering our clients on their growth journeys and delivering
exceptional client experiences. We bank clients, not economies, and will continue to seek out pockets of growth. In August
2017, we opened our doors in Abidjan, Ivory Coast, the biggest economy in the West African Economic and Monetary Union
(WAEMU) and one of the fastest growing economies on the continent, providing our clients with on-the-ground CIB capabilities
and access to the broader WAEMU region. In Africa Regions, we continue to develop our PBB franchises in a consciously
systematic manner; banking the employees, suppliers and customers of our corporate clients. Our strategy of banking the
ecosystems surrounding our clients continues to gain traction. 

We will continue to invest in our digital capabilities and the re-skilling of our employees, with the primary
objective of improving the client experience. We recognise that we are not where we want to be in terms of customer 
satisfaction and are making changes to ensure that we improve this going forward. Our core banking replacement journey 
in SA and Africa Regions remains on track to close by the end of the year. Although it has been a long and costly exercise, 
we remain of the opinion that it provides us with the resilient platform required to compete in a digital world. Our 
innovation initiatives extend across analytics, robotics, cyber security and blockchain. We will continue to seek 
opportunities to successfully collaborate with FinTechs and support relevant IT skills development initiatives.

In a complex business environment, we rely on the people across our network to navigate the challenges each business
faces and make appropriate decisions in line with strategic priorities. Doing the right business the right way remains a
priority. We take swift action against those who are proved to be at odds with this. Regulatory change, both locally and
internationally, has continued apace and appears unlikely to slow. We continue to engage with policymakers and regulators 
across our footprint to broker appropriately balanced outcomes. In South Africa specifically, we will continue to actively 
engage in the debates around the banking sector’s role in promoting transformation and inclusive growth, and on
specific issues such as the importance of the SARB’s mandate and independence.

As underpinned by our purpose of driving Africa’s growth, our view is that a financial institution’s role in society
is broader than providing superior returns to shareholders. In terms of our SEE impact, we have a responsibility to
facilitate growth in the markets in which we operate, improve financial literacy and access, and develop local markets 
in a responsible and sustainable way. 

We remain committed to our medium term targets of delivering through-the-cycle HEPS growth and ROE within our target
range of 15% - 18%. We are focused on the levers available to deliver on our targets, including positive jaws, efficient
capital management and improving returns from PBB Africa Regions. 

Sim Tshabalala                  Ben Kruger
Group chief executive           Group chief executive

Thulani Gcabashe
Chairman

16 August 2017

Declaration of dividends
Shareholders of Standard Bank Group Limited (the company) are advised of the following dividend declarations out of
income reserves in respect of ordinary shares and preference shares.

Ordinary shares
Ordinary shareholders are advised that the board of directors (the board) has resolved to declare an interim gross
cash dividend No. 96 of 400 cents per ordinary share (the cash dividend) to ordinary shareholders recorded in the 
register of the company at the close of business on Friday, 15 September 2017. The last day to trade to participate 
in the dividend is Tuesday, 12 September 2017. Ordinary shares will commence trading ex dividend from 
Wednesday, 13 September 2017.  

The salient dates and times for the cash dividend are set out in the table that follows.

Ordinary share certificates may not be dematerialised or rematerialised between Wednesday, 13 September 2017, and
Friday, 15 September 2017, both days inclusive. Ordinary shareholders who hold dematerialised shares will have their
accounts at their Central Securities Depository Participant (CSDP) or broker credited on Monday, 18 September 2017.

Where applicable, dividends in respect of certificated shares will be transferred electronically to shareholders' bank
accounts on the payment date. In the absence of specific mandates, dividend cheques will be posted to shareholders.

Preference shares
Preference shareholders are advised that the board has resolved to declare the following interim dividend:
- 6.5% first cumulative preference shares (first preference shares) dividend No. 96 of 3,25 cents (gross) per first
  preference share, payable on Monday, 11 September 2017, to holders of first preference shares recorded in the books 
  of the company at the close of business on the record date, Friday, 8 September 2017. The last day to trade to 
  participate in the dividend is Tuesday, 5 September 2017. First preference shares will commence trading ex dividend 
  from Wednesday, 6 September 2017.
- Non-redeemable, non-cumulative, non-participating preference shares (second preference shares) dividend No. 26 of
  400,93 cents (gross) per second preference share, payable on Monday, 11 September 2017, to holders of second preference
  shares recorded in the books of the company at the close of business on the record date, Friday, 8 September 2017. 
  The last day to trade to participate in the dividend is Tuesday, 5 September 2017. Second preference shares will 
  commence trading ex dividend from Wednesday, 6 September 2017.

The salient dates and times for the preference share dividend are set out in the table that follows.

Preference share certificates (first and second) may not be dematerialised or rematerialised between Wednesday, 
6 September 2017, and Friday, 8 September 2017, both days inclusive. Preference shareholders (first and second) who
hold dematerialised shares will have their accounts at their CSDP or broker credited on Monday, 11 September 2017.

Where applicable, dividends in respect of certificated shares will be transferred electronically to shareholders' bank
accounts on the payment date. In the absence of specific mandates, dividend cheques will be posted to shareholders.

The relevant dates for the payment of dividends are as follows:
                                                                                                            Non-redeemable,     
                                                                                                            non-cumulative,     
                                                                              6.5% cumulative             non-participating     
                                                        Ordinary            preference shares             preference shares     
                                                          shares    (First preference shares)    (Second preference shares)    
JSE Limited                                                                                                                   
Share code                                                   SBK                         SBKP                          SBPP    
ISIN                                                ZAE000109815                 ZAE000038881                  ZAE000056339    
Namibian Stock Exchange (NSX)                                                                                                  
Share code                                                   SNB                                                               
ISIN                                                ZAE000109815                                                               
Dividend number                                               96                           96                            26    
Dividend per share (cents)                                400,00                         3,25                        400,93    
Last day to trade in order to be                        Tuesday,                     Tuesday,                      Tuesday,
eligible for the cash dividend                 12 September 2017             5 September 2017              5 September 2017 
                                                      Wednesday,                   Wednesday,                    Wednesday,     
Shares trade ex the cash dividend              13 September 2017             6 September 2017              6 September 2017    
                                                         Friday,                      Friday,                       Friday,     
Record date in respect of the cash dividend    15 September 2017             8 September 2017              8 September 2017    
Dividend cheques posted and CSDP/broker                  Monday,                      Monday,                       Monday, 
account credited/updated (payment date)        18 September 2017            11 September 2017             11 September 2017 
                                                 
The above dates are subject to change. Any changes will be released on the Stock Exchange News Service (SENS) and
published in the South African and Namibian press.

Tax implications
The cash dividend received under the ordinary shares and the preference shares is likely to have tax implications for
both resident and non-resident ordinary and preference shareholders. Such shareholders are therefore encouraged to
consult their professional tax advisers.

In terms of the South African Income Tax Act, 58 of 1962, the cash dividend will, unless exempt, be subject to
dividends tax that was introduced with effect from 1 April 2012. South African resident ordinary and preference 
shareholders that are not exempt from dividends tax, will be subject to dividends tax at a rate of 20% of the cash 
dividend, and this amount will be withheld from the cash dividend with the result that they will receive a net amount 
of 320 cents per ordinary share, 2,6 cents per first preference share and 320,744 cents per second preference share. 
Non-resident ordinary and preference shareholders may be subject to dividends tax at a rate of less than 20% depending 
on their country of residence and the applicability of any Double Tax Treaty between South Africa and their country 
of residence.

The issued share capital of the company, as at the date of declaration, is as follows:
- 1 618 211 936 ordinary shares
- 8 000 000 first preference shares
- 52 982 248 second preference shares.

The company's tax reference number is 9800/211/71/7 and registration number is 1969/017128/06.


Financial statistics
for the six months ended 30 June 2017
                                             Change            1H17             1H16            FY16    
                                                  %       Unaudited        Unaudited         Audited    
Number of ordinary shares in issue (000's)                                                              
End of period                                             1 602 748        1 595 627       1 596 583    
Weighted average                                          1 603 040        1 597 746       1 597 739    
Diluted weighted average                                  1 622 574        1 618 260       1 619 444    
Cents per ordinary share                                                                                
Basic earnings                                   14           769,8            676,7         1 389,8    
Headline earnings                                11           755,5            679,8         1 440,1    
Diluted headline earnings                        11           746,4            671,2         1 420,8    
Dividend                                         18             400              340             780    
Net asset value                                   2           9 554            9 381           9 442    
Financial performance (%)                                                                               
ROE                                                            16.1             14.4            15.3    
Net interest margin on banking activities                      3.94             3.72            3.83    
Credit loss ratio on banking activities                        0.96             1.05            0.86    
Cost-to-income ratio on banking activities                     56.3             56.8            56.3    
Capital adequacy ratios (%)                                                                             
Basel III                                                                                               
Common equity tier 1 (CET1) capital 
adequacy ratio                                                 13.7             13.2            13.9    
Tier 1 capital adequacy ratio                                  14.2             13.6            14.3    
Total capital adequacy ratio                                   16.2             15.9            16.6    


Condensed consolidated statement of financial position
as at 30 June 2017
                                                            1H17             1H161              FY16    
                                                       Unaudited         Unaudited           Audited    
                                                              Rm                Rm                Rm    
Assets                                                                                                  
Cash and balances with central banks                      70 949            73 442            77 474    
Derivative assets                                         53 690            79 942            68 620    
Trading assets                                           126 565           122 839           129 845    
Pledged assets                                            17 447            18 324            18 777    
Financial investments                                    519 084           470 968           483 774    
Current and deferred tax assets                            2 264             1 962             2 467    
Loans and advances                                     1 043 398         1 071 206         1 065 405    
Policyholders' assets                                      7 689             7 661             7 314    
Other assets                                              30 547            29 127            21 547    
Interest in associates and joint ventures                  9 712             8 827             8 196    
Investment property                                       31 508            30 955            31 155    
Property and equipment                                    15 852            16 210            16 041    
Goodwill and other intangible assets                      23 814            23 970            23 675    
Total assets                                           1 952 519         1 955 433         1 954 290    
Equity and liabilities                                                                                  
Equity                                                   183 817           176 257           179 359    
Equity attributable to ordinary shareholders             153 132           149 690           150 757    
Equity attributable to other equity                                                   
instrument holders2                                        7 247             5 503             5 503    
Non-controlling interests                                 23 438            21 064            23 099    
Liabilities                                            1 768 702         1 779 176         1 774 931    
Derivative liabilities                                    59 861            90 951            75 083    
Trading liabilities                                       45 758            46 848            47 867    
Current and deferred tax liabilities                       7 970             7 992             8 317    
Deposits and debt funding                              1 212 115         1 197 155         1 213 621    
Policyholders' liabilities                               309 200           312 111           307 230    
Subordinated debt                                         24 954            28 438            25 997    
Provisions and other liabilities                         108 844            95 681            96 816    
Total equity and liabilities                           1 952 519         1 955 433         1 954 290    
1 Refer to the accounting policy elections and restatement regarding details of the change in presentation policy.             
2 Other equity instruments comprise: preference share capital of R5 503 million (1H16 and FY16: R5 503 million) and 
  AT1 capital of R1 744 million (1H16 and FY16: Rnil). Refer to the subordinated debt instruments paragraph within other 
  reportable items for further details regarding the AT1 capital.                                                                     


Condensed consolidated income statement
for the six months ended 30 June 2017
                                                                  1H17                 1H16                FY16    
                                                             Unaudited            Unaudited             Audited    
                                                                    Rm                   Rm                  Rm    
Income from banking activities                                  49 336               49 863              99 857    
Net interest income                                             28 770               27 775              56 892    
Non-interest revenue                                            20 566               22 088              42 965    
Income from investment management and life 
insurance activities                                            12 097               11 695              21 365    
Total income                                                    61 433               61 558             121 222    
Credit impairment charges                                       (5 155)              (5 815)             (9 533)   
Net income before operating expenses                            56 278               55 743             111 689    
Operating expenses in banking activities                       (27 769)             (28 340)            (56 235)   
Operating expenses in insurance activities                      (8 822)              (8 433)            (17 374)   
Net income before non-trading and capital related items         19 687               18 970              38 080    
Non-trading and capital related items                              214                 (214)             (1 123)   
Share of post tax profit from associates and joint ventures        412                  152                 187    
Net income before indirect taxation                             20 313               18 908              37 144    
Indirect taxation                                               (1 154)              (1 137)             (2 418)   
Net income before direct taxation                               19 159               17 771              34 726    
Direct taxation                                                 (4 526)              (4 716)             (8 932)   
Profit for the period                                           14 633               13 055              25 794    
Attributable to ordinary shareholders                           12 340               10 812              22 206    
Attributable to other equity instrument holders                    257                  196                 406    
Attributable to non-controlling interests                        2 036                2 047               3 182    
                                                                                                                   
Earnings per share                                                                                                 
Basic earnings per ordinary share (cents)                        769,8                676,7             1 389,8    
Diluted earnings per ordinary share (cents)                      760,5                668,1             1 371,2    


Condensed consolidated statement of other comprehensive income
for the six months ended 30 June 2017
                                                                  1H17                 1H16                FY16                
                                                             Unaudited            Unaudited             Audited                
                                                                    Rm                   Rm                  Rm                
Profit for the period                                           14 633               13 055              25 794                
Other comprehensive loss after tax for the period               (2 473)              (9 364)            (14 647)               
Items that may be reclassified subsequently 
to profit and loss                                              (2 368)              (9 306)            (14 773)               
Exchange differences on translating foreign operations          (2 697)              (9 315)            (14 680)               
Movement in the cash flow and net investment 
hedging reserve                                                     25                   28                  30                
Net change in fair value of cash flow and net investment 
in foreign operations' hedges                                       (7)              (1 164)             (1 319)               
Realised fair value adjustments of cash flow hedges 
transferred to profit or loss                                       32                1 192               1 349                
Movement in the available-for-sale revaluation reserve             304                  (19)               (123)               
Items that may not be reclassified to profit and loss                                                                          
Defined benefit fund and other remeasurements                     (105)                 (58)                126                
                                                                                                                               
Total comprehensive income for the period                       12 160                3 691              11 147                
Attributable to ordinary shareholders                           10 547                3 689              10 882                
Attributable to other equity instrument holders                    257                  196                 406                
Attributable to non-controlling interests                        1 356                 (194)               (141)               
                                                                                                                                  

Condensed consolidated statement of changes in equity
for the six months ended 30 June 2017
                                                                                      Equity         
                                                                                attributable         
                                                                   Ordinary         to other            Non-         
                                                              shareholders'           equity     controlling          Total   
                                                                     equity         holders1        interest         equity       
                                                                         Rm               Rm              Rm             Rm    
Balance at 1 January 2016 (audited)                                 151 069            5 503          22 336        178 908    
Total comprehensive income for the period                             3 689              196            (194)         3 691    
Transactions with owners, recorded directly in equity                (5 068)            (196)           (970)        (6 234)   
Equity-settled share-based payment transactions2                        487                               16            503    
Deferred tax on share-based payment transactions                         47                                              47    
Transactions with non-controlling shareholders                         (126)                            (302)          (428)   
Net dividends paid                                                   (5 979)            (196)           (693)        (6 868)   
Other equity movements                                                  503                                9            512    
Unincorporated property partnerships' capital                                                                   
reductions and distributions                                                                            (108)          (108)   
Balance at 30 June 2016 (unaudited)                                 149 690            5 503          21 064        176 257    
Balance at 1 July 2016                                              149 690            5 503          21 064        176 257    
Total comprehensive income for the period                             7 193              210              53          7 456    
Transactions with owners, recorded directly in equity                (6 126)            (210)          2 093         (4 243)   
Equity-settled share-based payment transactions2                       (361)                              32           (329)   
Deferred tax on share-based payment transactions                        160                                             160    
Transactions with non-controlling shareholders                         (522)                           2 407          1 885    
Net dividends paid                                                   (5 484)            (210)           (405)        (6 099)   
Other equity movements                                                   81                               59            140    
Unincorporated property partnerships' capital                                                                   
reductions and distributions                                                                            (111)          (111)   
Balance at 31 December 2016 (audited)                               150 757            5 503          23 099        179 359    
Balance at 1 January 2017 (audited)                                 150 757            5 503          23 099        179 359    
Total comprehensive income for the period                            10 547              257           1 356         12 160    
Transactions with owners, recorded directly in equity                (8 172)           1 487            (905)        (7 590)   
Equity-settled share-based payment transactions2                       (348)                               7           (341)   
Deferred tax on share-based payment transactions                        (45)                                            (45)   
Transactions with non-controlling shareholders                           81                              (67)            14    
Net dividends paid                                                   (7 100)            (257)           (814)        (8 171)   
Other equity movements                                                 (760)           1 744             (31)           953    
Unincorporated property partnerships' capital                                                                   
reductions and distributions                                                                            (112)          (112)   
Balance at 30 June 2017 (unaudited)                                 153 132            7 247          23 438        183 817    
1 Other equity holders are holders of preference share capital and AT1 capital. The group issued no preference shares for 
  1H17 (1H16 and FY16: nil) and issued R1 744 million AT1 capital for 1H17 (1H16 and FY16: nil).                                 
2 Includes hedges of the group's equity settled share incentive schemes.                                      


Condensed consolidated statement of cash flows
for the six months ended 30 June 2017
                                                                        1H17            1H16            FY16    
                                                                   Unaudited       Unaudited         Audited    
                                                                          Rm              Rm              Rm    
Net cash flows from operating activities                              17 401          10 839          40 255    
Cash outflow from direct taxation paid                                (5 187)         (4 745)         (9 232)   
Cash flow from other operating activities                             22 588          15 584          49 487    
Net cash flows (used in)/generated from investing activities         (10 382)          1 969         (13 377)   
Cash outflow from capital expenditure                                 (2 185)         (3 123)         (7 537)   
Cash flow from other investing activities                             (8 197)          5 092          (5 840)   
Net cash flows used in financing activities                           (5 944)         (5 736)        (12 030)   
Cash flow from equity transactions with non-controlling interests      1 674            (524)          1 575    
Cash outflow from subordinated debt instruments redeemed              (1 400)                         (3 175)   
Cash inflow from subordinated debt instruments issued                  2 001           1 714           2 694    
Cash outflow from dividends paid                                      (8 171)         (6 868)        (12 967)   
Cash flow from other financing activities                                (48)            (58)           (157)   
Effect of exchange rate changes on cash and cash equivalents          (7 600)         (8 742)        (12 486)   
Net (decrease)/increase in cash and cash equivalents                  (6 525)         (1 670)          2 362    
Cash and cash equivalents at beginning of the period                  77 474          75 112          75 112    
Cash and cash equivalents at the end of the period                    70 949          73 442          77 474    
Comprising:                                                                                                     
Cash and balances with central banks                                  70 949          73 442          77 474    

Notes

Condensed segment report
for the six months ended 30 June 2017
The group’s primary segments comprise the group’s banking activities (comprising PBB, CIB and central and other), the
group’s other banking interests (comprising the group’s interest in ICBC Argentina and ICBCS) and Liberty (comprising
the group’s investment management and life insurance activities). 

                                                                     1H17               1H16              FY16    
                                                                Unaudited         Unaudited1          Audited1    
                                                                       Rm                 Rm                Rm    
Revenue contribution by business unit                                                                             
Personal & Business Banking                                        33 398             33 617            67 622    
Corporate & Investment Banking                                     17 441             17 732            35 274    
Central and other                                                  (1 503)            (1 486)           (3 039)   
Banking activities                                                 49 336             49 863            99 857    
Liberty                                                            12 097             11 695            21 365    
Standard Bank Group                                                61 433             61 558           121 222    
Profit or loss attributable to ordinary shareholders                                                              
Personal & Business Banking                                         6 124              5 499            12 637    
Corporate & Investment Banking                                      5 307              4 832            10 247    
Central and other                                                    (213)              (407)           (1 625)   
Banking activities                                                 11 218              9 924            21 259    
Other banking interests                                               240                  2                (8)   
Liberty                                                               882                886               955    
Standard Bank Group                                                12 340             10 812            22 206    
Total assets by business unit                                                                                     
Personal & Business Banking                                       696 189            677 600           689 183    
Corporate & Investment Banking                                    858 127            911 751           897 565    
Central and other                                                 (22 312)           (40 059)          (42 990)   
Banking activities                                              1 532 004          1 549 292         1 543 758    
Other banking interests                                             7 811              7 028             6 445    
Liberty                                                           412 704            399 113           404 087    
Standard Bank Group                                             1 952 519          1 955 433         1 954 290    
Total liabilities by business unit                                                                                
Personal & Business Banking                                       622 077            606 450           618 113    
Corporate & Investment Banking                                    800 774            851 516           842 751    
Central and other                                                 (38 852)           (52 853)          (62 425)   
Banking activities                                              1 383 999          1 405 113         1 398 439    
Liberty                                                           384 703            374 063           376 492    
Standard Bank Group                                             1 768 702          1 779 176         1 774 931    
1 Where responsibility for individual cost centres and divisions within business units change, the comparative figures 
  have been reclassified accordingly.


Headline earnings
for the six months ended 30 June 2017
                                                                        1H17              1H16            FY16    
                                                                   Unaudited         Unaudited         Audited    
                                                                          Rm                Rm              Rm    
Profit for the period                                                 12 340            10 812          22 206    
Headline adjustable items (reversed)/added                              (230)               80             989    
IAS 16 - (Gain)/loss on sale of property and equipment                   (18)                5              50    
IAS 21 - Realised foreign currency profit on foreign operations         (214)                              (62)   
IAS 27/IAS 28 - Loss/(gains) on disposal of businesses                    18                 3             (11)   
IAS 28/IAS 36 - Impairment of associate                                                     10              10    
IAS 36 - Impairment of intangible assets                                                   196             654    
IAS 36 - Goodwill impairment                                                                               482    
IAS 39 - Realised gains on available-for-sale assets                     (16)             (134)           (134)   
Taxation on headline earnings adjustable items                            (1)              (26)           (178)   
Non-controlling interests’ share of headline earnings 
adjustable items                                                           2                (5)             (8)   
Standard Bank Group headline earnings                                 12 111            10 861          23 009    
Headline earnings per ordinary share (cents)                                                                      
Headline earnings per ordinary share                                   755,5             679,8          1440,1    
Diluted headline earnings per ordinary share                           746,4             671,2          1420,8    


Private equity associates and joint ventures
The following table provides disclosure of those private equity associates and joint ventures that are equity
accounted in terms of IAS 28 Investments in Associates and Joint Ventures and have been ring-fenced in terms of the 
requirements of Circular 2/2015 Headline Earnings, issued by SAICA at the request of the JSE. On the disposal of these 
associates and joint ventures held by the group’s private equity division, the gain or loss on the disposal will be 
included in headline earnings.

                                                           1H17             FY16    
                                                      Unaudited          Audited    
                                                             Rm               Rm    
Cost                                                         47               48    
Carrying value                                              411              389    
Fair value                                                  411              389    
Realised gains on disposal for the period 
included in headline earnings                                                 45    
Attributable income before impairment                        22                3    


Contingent liabilities and commitments
as at 30 June 2017
                                                           1H17             FY16 
                                                      Unaudited          Audited 
                                                             Rm               Rm 
Letters of credit and bankers’ acceptances               12 791           12 607 
Guarantees                                               62 793           64 076 
Contingent liabilities                                   75 584           76 683 
Investment property                                         514              633 
Property and equipment                                      357              315 
Other intangible assets                                     397              399 
Commitments                                               1 268            1 347 


Day one profit or loss
The table below sets out the aggregate net day one profits or loss yet to be recognised in profit or loss at the
beginning and end of the period with a reconciliation of changes in the balances during the period.

                                                                Derivative         Trading
                                                               instruments          assets            Total
                                                                        Rm              Rm               Rm    
Balance as at 1 January 2016 (audited)                                 295             582              877    
Additional net profit on new transactions during the year                2             137              139    
Recognised in profit or loss during the year                           (16)           (131)            (147)   
Exchange differences                                                  (120)                            (120)   
Balance as at 31 December 2016 (audited)                               161             588              749    
Balance as at 1 January 2017 (audited)                                 161             588              749    
Additional net profit on new transactions during the period            411              37              448    
Recognised in profit or loss during the period                         (25)            (36)             (61)   
Balance as at 30 June 2017 (unaudited)                                 547             589            1 136    


Related party transactions
Tutuwa related parties
Tutuwa participants were allowed to access their underlying equity value post the expiry of the lock-in period on 
31 December 2014. For both 1H17 as well as FY16 the shares in issue financed by the group had an opening and closing 
balance of 5 750 291 shares, with no movements in these shares for both periods. The weighted number of shares thus 
also equated to 5 750 291 for both periods.

Post-employment benefit plans
The group manages R11 193 million (FY16: R11 918 million) of the post-employment benefit plans’ assets.  Other
significant balances between the group and the group’s post-employment benefit plans are listed below:

                                                                       1H17            FY16 
                                                                  Unaudited         Audited 
                                                                         Rm              Rm 
Investments held in bonds and money market instruments                1 023             947 
Value of ordinary group shares held                                     528             570 


Balances and transactions with ICBCS
The following significant balances and transactions were entered into between the group and ICBCS, an associate of the
group. 
                                           1H17             FY16    
                                      Unaudited          Audited    
                                             Rm               Rm    
Derivative assets                         1 308            1 856    
Loans and advances                       11 301           30 111    
Other assets                              1 928              256    
Derivative liabilities                   (1 975)          (2 271)   
Deposits and debt funding                  (712)          (1 315)   
Provisions and other liabilities         (1 199)            (287)   


The group entered into certain transitional service level arrangements with ICBCS in order to manage the orderly
separation of ICBCS from the group post the sale of 60% of Standard Bank Plc (SB Plc). In terms of these arrangements,
services are delivered to and received from ICBCS for the account of each respective party. As at 30 June 2017 the 
expense recognised in respect of these arrangements amounted to R106 million (FY16: R202 million).


Balances and transactions with the Industrial and Commercial Bank of China (ICBC)
The following significant balances and transactions were entered into between the group and ICBC, a 20.1% shareholder
of the group.
                                          1H17               FY16 
                                     Unaudited            Audited 
                                            Rm                 Rm 
Loans and advances                         182                246 
Other assets                               629                656 
Deposits and debt funding                                  (6 583)


The group recognised losses in respect of certain commodity reverse repurchase agreements with third parties prior to
the date of conclusion of the disposal of a controlling interest in SB Plc to ICBC. As a consequence of the disposal of
SB Plc, the group has a right, by means of a post-disposal adjustment, to 60% of insurance and other recoveries, net of
costs, relating to claims by SB Plc for those recognised losses prior to the date of conclusion of the transaction.
Settlement of these amounts will occur based on audited information on pre-agreed anniversaries of the completion of the
transaction and the full and final settlement of all claims in respect of losses incurred. As at 30 June 2017, a balance 
of USD48 million (R629 million) (FY16: USD48 million; R656 million) is receivable from ICBC in respect of this arrangement. 

Mutual funds
The group invests in various mutual funds that are managed by Liberty. Where the group has assessed that it has control 
(as defined by IFRS) over these mutual funds, it accounts for these mutual funds as subsidiaries. Where the group has
assessed that it does not have control over these mutual funds, but has significant influence, it accounts for them as
associates. 

The following significant balances and transactions were entered into between the group and the mutual funds which the
group does not control:
                                                 1H17                  FY16    
                                            Unaudited            Unaudited1    
                                                   Rm                    Rm    
Trading liabilities                              (380)                 (397)   
Deposits and debt funding                     (12 774)              (14 105)   
Provisions and other liabilities               (3 095)               (1 595)   
Trading (losses)/gains                            (55)                   51    
Interest expense                                 (713)               (1 017)   
1 While this level of disclosure was not included in the FY16 audited group 
  financial statements, disclosure of the assets held by mutual funds in group 
  companies was provided only for those mutual funds which were material to 
  the group.
  
  
Change in group directorate
The following changes in directorate took place during the six months ended 30 June 2017: 

APPOINTMENTS
Dr H Hu                 As joint deputy chairman             1 June 2017    
L Wang                  As non-executive director            1 June 2017    
RESIGNATIONS                                                                
Dr S Gu                 As joint deputy chairman             1 June 2017    
Dr W Wang               As non-executive director            1 June 2017    
RETIREMENTS                                                                 
EM Woods                As non-executive director            26 May 2017    

Offsetting and other similar arrangements
Financial instruments subject to offsetting, enforceable master netting arrangements or similar agreements
IFRS requires a financial asset and a financial liability to be offset and the net amount presented in the 
statement of financial position when, and only when, the group has a current legally enforceable right to set 
off recognised amounts, as well as the intention to settle on a net basis or to realise the asset and settle 
the liability simultaneously. There are no instances where the group has a current legally enforceable right 
to offset without the intention to settle on a net basis or to realise the asset and settle the liability 
simultaneously.

The following table sets out the impact of offset, as well as the required disclosures of financial assets and
financial liabilities that are subject to enforceable master netting arrangements, or similar agreements, 
irrespective of whether they have been offset in accordance with IFRS. It should be noted that the information 
below is not intended to represent the group's actual credit exposure nor will it agree to that presented in 
the statement of financial position.

                                                              Financial            Net amounts of                                 
                                                    liabilities set off          financial assets                                 
                                 Gross amount          in the statement          presented in the                                            
                                of recognised              of financial              statement of      Collateral                    
                            financial assets1                 position2       financial position3        recieved4      Net amount  
                                           Rm                        Rm                        Rm               Rm              Rm  
Assets                                                                                                                                
30 June 2017 (unaudited)                                                                                                              
Derivative assets                      44 536                       (11)                   44 525          (38 101)          6 424    
Trading assets                         23 378                                              23 378          (18 687)          4 691    
Loans and advances5                    85 882                   (30 424)                   55 458          (54 304)          1 154    
Total                                 153 796                   (30 435)                  123 361         (111 092)         12 269    
31 December 2016 (audited)                                                                                                            
Derivative assets                      45 972                       (38)                   45 934          (41 316)          4 618    
Trading assets                         48 153                                              48 153          (45 370)          2 783    
Loans and advances5                   111 072                   (33 190)                   77 882          (76 589)          1 293    
Total                                 205 197                   (33 228)                  171 969         (163 275)          8 694    


                                                                                   Net amounts of                 
                                                                                        financial                 
                                                       Financial assets               liabilities                          
                                 Gross amount            set off in the          presented in the                                     
                                of recognised              statement of              statement of                                     
                                    financial                 financial                 financial       Collateral                  
                                 liabilities1                 position2                 position3         pledged6      Net amount
                                           Rm                        Rm                        Rm               Rm              Rm
                                                                                                                                      
Liabilities                                                                                                                           
30 June 2017 (unaudited)                                                                                                              
Derivative liabilities                 47 613                       (11)                   47 602          (40 309)          7 293    
Trading liabilities                    18 323                                              18 323          (18 323)                   
Deposits and debt funding5             36 034                   (30 424)                    5 610                            5 610    
Total                                 101 970                   (30 435)                   71 535          (58 632)         12 903    
31 December 2016 (audited)                                                                                                            
Derivative liabilities                 53 915                       (38)                   53 877          (46 424)          7 453    
Trading liabilities                    31 147                                              31 147          (31 147)                   
Deposits and debt funding5             39 374                   (33 190)                    6 184                            6 184    
Total                                 124 436                   (33 228)                   91 208          (77 571)         13 637    
1 Gross amounts are disclosed for recognised financial assets and financial liabilities that are either offset in the statement 
  of financial position or are subject to a master netting arrangement or a similar agreement, irrespective of whether the 
  offsetting criteria is met.                                                                                                               
2 Gross amounts of recognised financial assets or financial liabilities that qualify for offset in accordance with the criteria 
  per IFRS.
3 Related amounts not offset in the statement of financial position that are subject to a master netting arrangement or similar 
  agreement, including financial collateral (whether recognised or unrecognised) and cash collateral.                   
4 In most cases the group is allowed to sell or repledge collateral received.                                                  
5 The most material amounts offset in the statement of financial position pertain to cash management accounts. The cash management 
  accounts allow holding companies (or central treasury functions) to manage the cash flows of a group by linking the current 
  accounts of multiple legal entities within a group of companies. It allows for cash balances of the different legal entities 
  to be offset against each other to arrive at a net balance for the whole group. In addition, it should be noted that all 
  repurchase agreements and reverse repurchase agreements, subject to a master netting arrangement (or similar agreement), 
  have been included.                                                                                                               
6 In most instances, the counterparty may not sell or repledge collateral pledged by the group.       

The table below sets out the nature of the agreements and the rights relating to items which do not qualify for offset
but that are subject to either a master netting arrangement or similar agreement.

FINANCIAL ASSET/LIABILITY                   NATURE OF AGREEMENT                                  RELATED RIGHTS TO OFFSET              
Derivative assets and liabilities           International swaps and derivatives associations     The agreement allows for offset 
                                                                                                 in the event of default.             
Trading assets and trading liabilities      Global master repurchase agreements                  The agreement allows for offset 
                                                                                                 in the event of default.                       
Loans and advances                          Customer agreement and Banks Act                     In the event of liquidation or 
                                                                                                 bankruptcy, offset shall be 
                                                                                                 enforceable subject to Banks Act 
                                                                                                 requirements being met.    
Deposits and debt funding                   Customer agreement and Banks Act                     In the event of liquidation or    
                                                                                                 bankruptcy, offset shall be 
                                                                                                 enforceable subject to Banks Act
                                                                                                 requirements being met.    

Other reportable items 
Equity securities
During the period, the group allotted 1 239 731 shares (FY16: 2 646 456 shares) in terms of the group's share
incentive schemes and repurchased 1 448 961 shares (FY16: 2 477 472 shares).

The total equity securities held as treasury shares at the end of the period was 9 713 295 shares (FY16: 16 086 916
shares). These treasury shares exclude group shares that are held by certain structured entities (SEs) relating to the
group's Tutuwa initiative (refer to the related party transaction note for more detail) since those SEs hold the voting
rights on such shares and are accordingly not treasury shares as defined by the JSE Listings Requirements.

Foreign currency translation reserve (FCTR)
During the six months ended 30 June 2017 the group's share of FCTR decreased by R1.9 billion (1H16: decrease of 
R7.1 billion). This decrease was partly attributable to the weakening of the Nigerian naira (22%), US dollar (4%), 
and Kenyan shilling (5%) against the South African rand which resulted in an FCTR loss of R833 million, R540 million 
and R220 million respectively.

Included in the FCTR loss of R833 million for the period relating to the Nigerian naira was a loss of R698 million as
a result of the establishment of the Nigerian Autonomous Foreign Exchange Fixing (NAFEX) by the Central Bank of Nigeria
(CBN) in April 2017. The CBN introduced the NAFEX to improve foreign exchange liquidity.

IFRS 9 financial instruments (IFRS 9)
Background
IAS 39 Financial Instruments: Recognition and Measurement (IAS 39), the existing standard dealing with the accounting
treatment for financial instruments will be replaced by IFRS 9 for the group's 2018 financial year. The following areas
represent the major changes from that of IAS 39:
- Revised requirements for the classification and measurement of financial assets and consequential changes in the
  classification and measurement of financial liabilities.
- Recognition of changes in fair value due to changes in own credit risk on fair value designated financial
  liabilities in OCI as opposed to the income statement.
- Revised requirements and simplifications for hedge accounting.
- An expected credit loss (ECL) impairment model.

Comparative financial results and elections
The group has elected not to restate comparative financial results in line with the IFRS 9 transitional requirements.
The difference between the previous (IAS 39) and new (IFRS 9) carrying values (including any tax impact) will be
recognised in the group's opening retained earnings on 1 January 2018. 

The group's date of adoption of the IFRS 9 revised hedge accounting requirements will be based on further IFRS
developments with respect to the IASB's macro hedge accounting project or on the group deeming it opportune to 
adopt the revised requirements. In the interim the group will continue to utilise the accounting policy choice 
to continue hedge accounting in terms of IAS 39.

Parallel run
From January 2017, the group commenced a process by which the group's IFRS 9 results are computed alongside that 
of the existing IAS 39 financial results (referred to as the group's parallel run). This parallel run aims to:
- Provide results that will be utilised to finalise and, where applicable, update impairment methodologies.
- Refine and approve the ECL impairment and business models for the classification and measurement of financial
  assets. 
- Assist in the audit of the group's transition to IFRS 9. 

Impact - qualitative assessment
The impact of the IFRS 9 revised classification and measurement requirements for financial assets is not expected 
to be material. This conclusion is however dependent on the nature of and carrying value of financial assets in 
place on 1 January 2018.  

The IFRS 9 ECL impairment model requirements are expected to increase the level of balance sheet impairments that 
are currently held in terms of IAS 39. The impact of the IFRS 9 ECL requirements can only be reliably determined 
on the date of transition to IFRS 9. This impact is primarily dependent on the finalisation of the group's impairment
methodologies, conclusion of audit procedures by the group's external auditors as well as the credit quality and 
extent of the group's exposures and determination of forward-looking economic expectations at that date. 

The following table summarises IFRS 9's key drivers as compared to that of IAS 39:

IFRS 9 driver                             Reason                                                                        
Stage one                                 PBB's existing emergence period is between three to six months and for CIB                
(12-month                                 is 12 months. The change to a 12 month expected loss requirement is expected                   
expected loss)                            to impact PBB with minimal impact to CIB.                       
Stage two                                 IFRS 9 will require a lifetime loss to be recognised for items for which     
(lifetime expected loss                   there has been a deterioration in credit risk. It is expected that this 
for items for which there is a            will increase both PBB and CIB's balance sheet impairments.           
significant increase in credit risk)                                                                                                    
Stage three (lifetime expected            Similar requirements to that of existing accounting requirements.
loss for credit impaired exposures)                                                            
Off-balance sheet exposures               The IFRS 9 requirement for impairments for off-balance sheet facilities  
                                          results in the requirement for additional balance sheet impairments for  
                                          both PBB and CIB.                                                   
Forward-looking information               The inclusion of forward-looking economic information is expected to 
                                          increase the transition adjustment on adoption of IFRS 9, but will depend 
                                          on the economic outlook at that date.                            

Tax implications
Within South Africa, National Treasury recently released the draft Taxation Laws Amendment Bill which contained
requirements for the deductibility of impairments in accordance with IFRS 9. National Treasury has proposed an 85% 
allowance for impairment provisions for defaulted exposures and a 25% allowance for impairment provisions for all 
other exposures. It is expected that this legislation will result in an increase in the deferred tax asset carrying 
value for the group and a consequential further deduction of both CET1 and Tier 1 capital for the group. 

Capital implications
IFRS 9 (including the related tax consequences) will affect the group's regulatory capital requirements. The expected
increase in impairment provisions, along with the increase in the group's deferred tax asset carrying value, will 
reduce CET1 capital. This reduction in CET1 capital will, however, be partially reduced by the release of the existing 
CET1 deduction for the excess of regulatory expected losses over IFRS impairments (currently cR2 billion). The Basel 
Committee on Banking Supervision (BCBS) has provided country regulators with national discretion to consider 
transitional phase-in provisions for the capital impact of IFRS 9. The SARB is considering the BCBS's proposals for 
possible adoption in South Africa.

Communication of transition impact
The group will, together with our 1Q18 SENS announcement regarding the group's statement of changes in equity, release
a transitional report which will outline the impact of the transition to IFRS 9 on the group's financial results.

Legal proceedings 
In the ordinary course of business, the group is involved as a defendant in litigation, lawsuits and other
proceedings. Management recognises the inherent difficulty of predicting the outcome of defended legal proceedings. 
Nevertheless, based on management's knowledge from investigation, analysis and after consulting with legal counsel, 
management believes that there are no individual legal proceedings that are currently assessed as being 'likely to 
succeed and material' or 'unlikely to succeed but material should they succeed'. The group is also the defendant in 
some legal cases for which the group is fully indemnified by external third parties, none of which are individually 
material. Management is accordingly satisfied that the legal proceedings currently pending against the group should 
not have a material adverse effect on the group's consolidated financial position and the directors are satisfied 
that the group has adequate insurance programmes and, where required in terms of IFRS for claims that are probable, 
provisions in place to meet claims that may succeed.

Competition Commission - trading of foreign currency 
In April 2015, the South African Competition Commission announced that it had initiated a complaint against Standard
New York Securities Inc. (SNYS) and 21 other institutions concerning possible contravention of the Competition Act in
relation to USD/ZAR trading between 2007 and 2013. No mention was made of SBSA. On 15 February 2017 the Competition
Commission lodged five complaints with the Competition Tribunal against 18 institutions, including one against SBSA and 
two against SNYS, in which it alleges unlawful collusion between those institutions in the trading of USD/ZAR. The group 
only learned of the complaints at this time. SBSA has made an application to the Competition Tribunal for an order directing
the Competition Commission to deliver a copy of the documents and other evidence that it relied upon when deciding to
refer its complaint to the Tribunal, the application being necessary due to the Competition Commission's failure to comply
with the applicable rules in this regard. Both SBSA and SNYS have, together with 12 of the other respondents, applied
for dismissal of the complaint referral on various legal grounds. A date for the hearing of those applications has yet to
be set. The group considers these allegations in an extremely serious light and remains committed to maintaining the
highest levels of control and compliance with all relevant regulations. The allegations, against SBSA, are confined to
USD/ZAR trading activities within SBSA and do not relate to the conduct of the group more broadly. 

Indemnities granted following disposal of SB Plc 
Under the terms of the disposal of SB Plc on 1 February 2015, the group provided ICBC with certain indemnities to be
paid in cash to ICBC or, at ICBC's direction, to any SB Plc (now ICBCS) group company, a sum equal to the amount of
losses suffered or incurred by ICBC arising from certain circumstances. Where an indemnity payment is required to be made 
by the group to the ICBCS group, such payment would be grossed up from ICBC's shareholding at the time in ICBCS to 100%.
These payments may, inter alia, arise as a result of an enforcement action, the cause of which occurred prior to the date
of disposal. Enforcement actions include actions taken by regulatory or governmental authorities to enforce the relevant
laws in any jurisdiction. While there have been no material claims relating to these indemnification provisions during
2017, the indemnities provided are uncapped and of unlimited duration as they reflect that the pre-completion regulatory
risks attaching to the disposed-of business remain with the group post completion. The indemnification provisions
covered the Deferred Prosecution Agreement (DPA) that ICBCS entered into with the United Kingdom Serious Fraud Office (SFO)
(as more fully set out in the announcement made to shareholders via the JSE's SENS on 30 November 2015). In terms of the
DPA, prosecution has been suspended and will be withdrawn after three years provided that ICBCS has complied with its
obligations under the DPA. Any claims that may arise for SNYS with respect to the Competition Commission matter are also
likely to fall within the scope of this indemnity as the conduct, which is the subject of the referral, pre-dates SB
Plc's acquisition of SNYS as part of the disposal of SB Plc.

Subordinated debt instruments
During the period, the group did not issue (FY16: R2.7 billion) Basel III compliant Tier 2 subordinated debt
instruments. R0.3 billion (FY16: Rnil) of Basel II compliant Tier 2 subordinated debt instruments were issued during the 
period in jurisdictions that have not yet adopted the Basel III framework. The group redeemed R1.4 billion (FY16: R3.2 billion)
Basel II compliant Tier 2 subordinated debt instruments during the period.

The group issued its debut Basel III compliant AT1 capital bond that qualifies as Tier 1 capital on 30 March 2017
amounting to R1.7 billion. The capital notes are perpetual, non-cumulative with an issuer call option after a minimum 
period of five years and one day and on every coupon payment date thereafter. 

The terms of the Basel III compliant AT1 capital bond and Tier 2 bonds include a regulatory requirement which provides
for the write-off, in whole or in part, on the earlier of a decision by the relevant regulator (the SARB) that a
write-off without which the issuer would have become non-viable is necessary, or a decision to make a public sector 
injection of capital or equivalent support, without which the issuer would have become non-viable.   

All of the above-mentioned subordinated debt instruments have been recognised within the subordinated debt in the
statement of financial position with the exception of the AT1 capital bonds that have been recognised within other 
equity instruments in the statement of financial position. 

Accounting policy elections and restatement
Adoption of amended standards effective for the current financial period
The accounting policies are consistent with those reported in the previous year except as required in terms 
of the adoption of the following amendments effective for the current period:
- Annual improvements 2014 - 2016 clarification to IFRS 12 Disclosure of Interests in Other Entities. 
  Early adoption of revised standards:
- Amendment to IFRS 2 Classification and Measurement of Share-based Payment Transactions
- Annual improvements 2014 - 2016 clarification to IFRS 1 First-time Adoption of International Financial Reporting
  Standards (IFRS 1) and  IAS 28 Investments in Associates and Joint Ventures.
- Amendment to IAS 40 Investment Property.

The abovementioned amendments to the IFRS standards, adopted on 1 January 2017, did not have any effect on the 
group's previously reported financial results or disclosures and had no material impact on the group's 
accounting policies. 

Change in presentation policy for policyholders' assets and liabilities
For the year ended 31 December 2016, a change in presentation was adopted to disclose portfolio level negative
policyholders' liabilities as policyholders' assets. In addition, to provide more relevant and useful information 
to the user, reinsurance liabilities were also excluded from policyholders' liabilities and is now included in 
provisions and other liabilities. 

The financial impact of this change on the results for the six months ended 30 June 2016 is as follows:

                                                              1H16                                        
                                      As previously presented      Revised presentation    
Description                                                Rm                        Rm    
                                                  (Liability)         Asset/(liability)    
                                                                                           
Policyholders' assets                                                             7 661    
Policyholders' liabilities                           (305 065)                 (312 111)   
Provisions and other liabilities1                     (95 066)                  (95 681)   
1 Reinsurance liabilities of R615 million as at 30 June 2016 were previously disclosed within policyholders' 
  liabilities and are now included within the provisions and other liabilities line item.                                                                 

Other information
Pro forma constant currency financial information
The pro forma constant currency information disclosed in these results is the responsibility of the group's directors.
The pro forma constant currency information has been presented to illustrate the impact of changes in currency rates on
the group's results and may not fairly present the group's results of operations. In determining the change in constant
currency terms, the comparative financial reporting period's results have been adjusted for the difference between the
current and prior period's average exchange rates (determined as the average of the daily exchange rates). The
measurement has been performed for each of the group's material currencies. The pro forma constant currency financial 
information contained in this announcement has not been reviewed and reported on by the group's external auditors. 

The following average exchange rates were used in the determination of the pro forma constant currency information and
were calculated using the average of the average monthly exchange rates (determined on the last day of each of the 
six months in the period).

                         1H17 average             1H16 average     
                        exchange rate            exchange rate    
US dollar                       13.20                    15.40    
Pound sterling                  16.62                    22.07    
Argentinian peso                 0.84                     1.08    
Nigerian naira                   0.04                     0.08    
Kenyan shilling                  0.13                     0.15    
Zambian kwacha                   1.39                     1.44    

Johannesburg, 17 August 2017

Administrative and contact details

Standard Bank Group Limited
Registration number 1969/017128/06
Incorporated in the Republic of South Africa
Website: (www.standardbank.com)

Registered office
9th Floor, Standard Bank Centre
5 Simmonds Street, Johannesburg, 2001
PO Box 7725, Johannesburg, 2000

Group secretary
Zola Stephen
Tel: +27 11 631 9106
Email: Zola.Stephen@standardbank.co.za 

Head: Investor relations
Sarah Rivett-Carnac
Tel: +27 11 631 6897
Email: Sarah.Rivett-Carnac@standardbank.co.za

Group financial director
Arno Daehnke
Tel: +27 11 636 3756
Email: Arno.Daehnke@standardbank.co.za

Head office switchboard
Tel: +27 11 636 9111 

Directors
TS Gcabashe (chairman), H Hu2 (deputy chairman), 
JH Maree (deputy chairman), A Daehnke*, RMW Dunne1, 
GJ Fraser-Moleketi, GMB Kennealy,
BJ Kruger* (chief executive), NNA Matyumza,
KD Moroka, ML Oduor-Otieno3, AC Parker, 
ANA Peterside CON4 , MJD Ruck, PD Sullivan5,
BS Tshabalala, SK Tshabalala* (chief executive), 
JM Vice, L Wang2
*Executive Director 1British   2Chinese  3Kenyan   4Nigerian   5Australian 

All nationalities are South African, unless otherwise specified above.

Share transfer secretaries in South Africa
Computershare Investor Services Proprietary Limited
Rosebank Towers, 15 Biermann Avenue, Rosebank, 
Johannesburg, 2196
PO Box 61051, Marshalltown, 2107

Share transfer secretaries in Namibia
Transfer Secretaries (Proprietary) Limited
4 Robert Mugabe Avenue
(entrance in Burg Street), Windhoek
PO Box 2401, Windhoek

JSE independent sponsor
Deutsche Securities (SA) Proprietary Limited

Namibian sponsor
Simonis Storm Securities (Proprietary) Limited

JSE joint sponsor
The Standard Bank of South Africa Limited

Share and bond codes
JSE share code:  SBK ISIN: ZAE000109815
NSX share code: SNB ZAE000109815

SSN series and CLN series (all JSE-listed bonds issued in terms of The Standard Bank 
of South Africa Limited's Domestic Medium Term Note Programme and Credit Linked Note Programme)

Please direct all customer queries and comments to: 
Information@standardbank.co.za

Please direct all shareholder queries and comments to: 
InvestorRelations@standardbank.co.za

Refer to www.standardbank.com/reporting for a list of definitions, acronyms and abbreviations

www.standardbank.com/reporting




Date: 17/08/2017 08:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
 the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, 
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
 information disseminated through SENS.

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