StanChart Kenya’s Investment In Tech Evident In Its 2023 Results

Standard Chartered Bank Kenya Limited’s full year results show that the bank registered a 32 per cent increase in its net interest income, which can partly be attributed to the bank’s investement in a digital strategy.

This is a good example of how technology is impacting organizations in Africa, especially given that the African population has improved in the adoption of technology. StanChart Kenya’s CEO, Kariuki Ngari, said that the bank’s investment in its digital expenses led to a 20 per cent rise in operating expenses. This increase can also be attributed to the impact of inflation given that the bank still realized an increase in profit.

“We delivered a strong performance in 2023 with Profit Before Tax up 15 per cent year on year to KES 19.7 billion. Our top line growth of 23 per cent benefited from strong business momentum coupled with improved margins. Our continued investment in a strong digital proposition and the impact of inflation led to a 20 per cent rise in operating expenses. Loans and advances were up 17 per cent, while deposits grew by 23 per cent, demonstrating that we continue to provide value to our clients,” Ngari said.

According to Ngari, the operating expenses rising by 20 per cent reflects on the impact of inflation as well as increased investment spend on digital capabilities.

“We have invested in digitizing all our processes including the experience of the staff. This was seen during the COVID-19 pandemic and we are still operating on a hybrid environment. We all know that technology keeps changing so we still have our ears on the ground to invest in the newest relevant technology so that we stay ahead of the curve in terms of technology adoption,” Ngari reiterated.

Speaking to CIO Africa, Jaine Mwai, the Chief Information Officer (CIO) of Standard Chartered Bank Kenya, supported Ngari’s statement saying that the digital strategy the company engaged in is now starting to bear fruits.

“In our digital strategy, we have invested in digitizing all our products both within the corporate space and the retail space. If you take an example of the Shillingi product, it has grown exponentially because of how technology penetration in the country (Kenya) has also grown. We have an app where we list all these products and our customers can access most services through the app. This has played a part in the growth of our YoY profit,” Mwai said.

More on StanChart Kenya Financial Results

All commentary that follows is on comparisons made to the year ended 31 December 2022.

• Operating income increased 23 per Within this:
  • Net interest income increased 32 per cent due to growth in asset volumes and improved
  • Non-interest income increased 6 per cent due to growth in transactions volumes, favourable market movements, and robust performance in the Wealth Management
• Operating expenses increased 20 per cent reflecting the impact of inflation as well as increased investment spend on digital
• Impairment losses on loans and advances increased by KES 1 billion, reflecting continued active management of the credit portfolio. Credit quality remained resilient. We remain alert to a volatile and challenging macro-economic environment.