CFC Stanbic Bank Posts $25m Profit, Expands To South Sudan

CFC-Stanbic-bank

VENTURES AFRICA – CFC Stanbic Bank, a subsidiary of Standard Bank, has posted its result for the nine months ended September 2012, with the results revealing a 51.55 percent surge in after-tax profit to Sh2.14 billion ($25 million) from Sh1.4 billion ($12.6 million) in the same period the previous year.

The bank’s deposits climbed a meagre 7.8 percent to Sh85.73 billion ($991 million) from Sh79.53 billion ($921 million) while its loan book dropped by 9.44 per cent to Sh62.22 billion ($723 million) from Sh68.7 billion ($80 million).

According to BusinessDaily, while many commercial lenders interest paid on deposits multiplied to Sh4.27 billion ($50 million) from Sh1.47 billion ($12.6million), CFC Stanbic saw its interest income grow to Sh9.08 billion ($109 million) from Sh5.77 billion ($62 million).

Last week, CFC Stanbic Holdings new shares begun trading at the Nairobi Securities Exchange (NSE) following a successful Rights Issue which commenced November 9 and saw the offer subscribed by 112 percent.

Speaking at the floor of the Nairobi bourse, CFC Stanbic Holdings Chairman, Mr. Fred Ojiambo said the proceeds from the liquidity totalling Sh4.014 billion ($49 million) would go towards helping the financial services firm boost its business in both Kenya and South Sudan, noting that there was strong interest in the rights issue from both local and foreign investors.

At the launch, Greg Brackenridge managing director at CFC Stanbic Bank disclosed that the bank was looking to open three or four new branches in South Sudan next year and expand its presence in Mombasa with an additional branch bringing its total network in Kenya to 24.

He added that the bank’s current operation in South Sudan could break even by the end of this year and that the back office operations of the South Sudan branch were being done in Kenya helping to cut costs.

“We anticipate that the branch will break even much earlier that we had originally planned. Typically it takes between 12 to 18 months for a new operation to begin to make a profit. We think we will make a profit this year,” said Mr Brackenridge.