SBN Holdings Limited, the holding company for Standard Bank Namibia Limited, has recorded a profit after tax of N$1.053 billion for the year ended 31 December 2024.
This marks a significant increase from N$770 million in 2023, crossing the N$1 billion mark for the first time.
The Group attributed this growth to strategic initiatives, including funding optimization, expansion of digital banking platforms, improved cost efficiency, and disciplined credit risk management.
“This impressive growth is directly attributable to a combination of strategic initiatives, funding optimization, the successful scaling of our digital banking platforms driving increased transactional volumes, enhanced cost efficiency achieved through operational improvements, and a steadfast commitment to disciplined credit risk management,” said Chief Executive Officer Erwin Tjipuka.
Pre-provision profit increased by 27.6% from N$1.279 billion in 2023 to N$1.631 billion in 2024. Meanwhile, net interest income surged to N$2.067 billion, marking a 14.8% increase from the prior year.
“This growth was underpinned by strong average balance sheet growth and higher margins resulting from funding optimization strategies,” the bank noted.
Net interest margin increased by 40 basis points to 5.6% in the current year. Non-interest revenue rose by 15.3% to N$1.678 billion, driven by increases in net fee and commission revenue (9%), trading revenue (11.7%), other revenue (31.7%), and other gains and losses on financial instruments (46.8%).
“The main driver for the increase in net fee and commission revenue was the growth in transactional volumes. Trading volumes, expanded client propositions, foreign exchange and commodity volatilities underpinned the growth in trading revenue,” Standard Bank stated.
Other revenue growth stemmed from a 7.9% increase in insurance-related revenue and profits earned from the disposal of Spearmint Investments (Pty) Ltd-related entities.
“The increase in other gains and losses in financial instruments is largely due to a 57.2% growth in distributions from financial investments driven by higher investments resulting from excess funds held during the year,” the bank added.
Credit impairments decreased by 35.1% year on year, attributed to the regularization of group scheme home loan accounts, previously impaired due to technical challenges, and the implementation of the bank’s non-performing loan (NPL) strategy.
“The credit loss ratio (CLR) decreased to 0.37% compared to 0.59% in the prior year. The CLR improved due to the decrease in credit impairment charges and the growth in loans and advances. The group is prudent in its provisioning and closely monitors and reassesses its strategic NPL initiatives to ensure they are fit for purpose,” the bank noted.
Operating expenses growth slowed to 6.9%, a 10.8% decrease from the prior year, aligning more closely with the average inflation rate of 4.3%.
Loans and advances to customers increased by 3.8% year on year, reversing a 2.8% decline in the prior year.
“The franchise portfolio increased as follows: CIB by 9.8%, driven by the growth experienced in medium-term loans, and BCB and PPB portfolios by 1.7%, underpinned by growth in vehicle and asset finance and unsecured lending as a result of the digital lending introduced in the current year,” the results revealed.
Deposits from customers saw a significant 10.9% increase, driven by growth in demand and term deposits and a strategic decrease in negotiable certificates of deposit.
“The aforementioned increase is a result of our efforts to diversify our deposit mix to meet strategic goals. Debt securities decreased by 23.2% following the redemption at maturity of the SBNA24 and SBNO2 facilities with an issuance volume of N$658.5 million during the year,” the bank noted.
The group’s liquidity position remained strong and within approved risk appetite and tolerance limits.
“The group continuously ensures that it has sufficient marketable assets available in its portfolio to meet the outflow demand in both business-as-usual and stress circumstances,” SBN stated.
