Standard Bank slows Africa expansion, cut jobs

Standard Bank, Africa’s biggest bank by assets, will slacken its Africa expansion drive as part of plans to hold down costs after confirming it would slash more than 2,000 jobs.

Standard Bank, 20 percent owned by Industrial and Commercial Bank of China, said on Friday it would slow down the roll out of the number of new branches across the continent.

The bank, which is looking to position itself as a full-service gateway to fast growing Africa, will cut 2,015 jobs in South Africa and London to ease pressure on revenue.

Standard Bank said it would shed a total of 1,145 permanent and 600 contractors in Johannesburg and 160 permanent and 110 contractors in London.

“As a responsible management team you have to do something … we have taken the knife out everywhere,” Chief Executive Jacko Maree told a news conference.

Banks in Africa’s largest economy have struggled as high unemployment and household debt levels have blunted demand for loans and hurt corporate spending.

Standard Bank reported a 9 percent rise in first-half profit in August, helped by a decline in bad loans. However, net interest income and non-lending revenue — the two most important earnings measures for a commercial bank — both declined.

Maree said revenue for the next financial year was likely to be flat or lower as demand for credit remained weak while the cost of longer-term funding climb.

Shares in Standard Bank, which have gained just over 1 percent so far this year, were 0.60 percent lower at 102.61 rand, largely in line with Johannesburg’s blue-chip Top-40 index

Source: Reuters