Financial information provided to ICBC and update on operational performance
Standard Bank Group Limited
Registration No. 1969/017128/06
Incorporated in the Republic of South Africa
JSE and A2X share code: SBK
NSX share code: SNB
(“Standard Bank Group” or “the group”)
Financial information provided to the Industrial and Commercial Bank of China Limited (“ICBC”) and
update on the group’s operational performance for the nine months ended 30 September 2019
Financial information provided to ICBC
On a quarterly basis the Standard Bank Group discloses to ICBC sufficient information to enable ICBC to equity
account the group's results. Accordingly, the following consolidated financial information, prepared on an
International Financial Reporting Standards (“IFRS”) basis, is being provided to ICBC for the nine months ended
30 September 2019.
Statement of changes in ordinary shareholders' equity for the nine months ended 30 September 2019
Balance as at Earnings Other movements Balance as at
1 January attributable to for the period 30 September
2019 ordinary 2019
Rm Rm Rm Rm
capital 162 162
premium 17 698 124 17 822
hedging reserve (2 977) (1 165) (4 142)
(FCTR) (1 800) (1 045)1 (2 845)
net investment and
cash flow hedging
reserve (1 177) (120) (1 297)
Retained earnings 149 308 17 973 (16 428)2 150 853
treasury shares (2 358) 1 170 (1 188)
Other 3 418 1 316 4 734
shareholders’ equity 165 251 17 973 (14 983) 168 241
1 The movement in the FCTR was mainly due to the introduction of the RTGS dollar in Zimbabwe.
2 Primarily comprises the ordinary dividends declared in March and August 2019 and transactions with
Update on the group’s performance for the nine months ended 30 September 2019
For the nine months to 30 September 2019, net interest income grew faster than non-interest revenue. Net
interest income was supported by higher average loan and deposit balances relative to the nine months to
30 September 2018. Income growth remained above operating expense growth resulting in positive jaws. Credit
impairment charges increased period on period on the back of loan book growth and charges in East Africa and
Banking activities headline earnings growth continues to outpace the group’s headline earnings growth.
The major business lines of ICBC Standard Bank Plc (‘ICBCS’) continue to be negatively impacted by
deteriorating market conditions and lower than anticipated client flows. These factors have impacted the
business’ ability to deliver appropriate returns on a standalone basis. The group has accordingly reviewed and
impaired the value of its 40% associate investment in ICBCS from USD383 million to USD220 million as at 30
September 2019. The impairment of R2.4 billion has been recognised in earnings attributable to ordinary
shareholders. As at 30 September 2019 ICBCS had sufficient capital to meet its regulatory requirements.
Standard Bank Group is engaging with ICBC and ICBCS to determine the best way forward for the business.
In the nine months to 30 September 2019, headline adjustable items, other than the ICBCS impairment, were not
significant. Adjusting for the ICBCS impairment, earnings attributable to ordinary shareholders were 2% higher
than recorded in the nine months to 30 September 2018.
The group’s Basel III disclosure as at 30 September 2019 will be released in November 2019.
The information contained in this announcement and that on which the operational performance update is based
has not been reviewed and reported on by the group's external auditors.
22 October 2019
The Standard Bank of South Africa Limited
JP Morgan Equities South Africa Proprietary Limited
Simonis Storm Securities (Proprietary) Limited
Date: 22/10/2019 08:00:00
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