{"id":420902,"date":"2020-07-29T16:25:17","date_gmt":"2020-07-29T14:25:17","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=420902"},"modified":"2020-07-29T16:31:40","modified_gmt":"2020-07-29T14:31:40","slug":"standard-bank-shares-rise-after-profit-slumps-less-than-expected","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/banking\/420902\/standard-bank-shares-rise-after-profit-slumps-less-than-expected\/","title":{"rendered":"Standard Bank gains after profit slumps less than expected"},"content":{"rendered":"

Shares of Standard Bank Group rose the most in three weeks after a decline in first-half profit was less severe than expected for Africa\u2019s largest lender.<\/p>\n

Earnings per share before one-time items in the six months through June probably fell 30% to 50% from a year earlier, Johannesburg-based Standard Bank said in a statement on Wednesday<\/p>\n

. The stock rallied as much as 4.4%, leading gains on the six-member FTSE\/JSE Africa Banks Index and helping to pare the gauge\u2019s decrease this year to 36%.<\/p>\n

Some investors \u201cwill breathe a sigh of relief that the extent of the credit impairments is limited to a number slightly larger than the global financial crisis, rather than a multiple of it,\u201d Citigroup Inc. analyst Charles Russell said in a report.<\/p>\n

Still, these could still increase when relief that the lender has extended to clients, such as payment holidays, come to an end and the \u201ctrue underlying credit performance is revealed.\u201d<\/p>\n

South Africa\u2019s banks are preparing for what could be the worst earnings slump since World War II as measures to curb the coronavirus drag the economy deeper into recession.<\/p>\n

Lenders are having to boost provisions for doubtful debts and restructure loans with companies and consumers struggling to meet their obligations.<\/p>\n

\"\"<\/a><\/p>\n

\u201cDespite considerable effort, the pandemic appears to be gaining momentum in certain of the markets in which the group operates on the continent, particularly in South Africa,\u201d Standard Bank said.<\/p>\n

\u201cThe path from here remains uncertain and this continues to weigh on sentiment and demand.\u201d<\/p>\n

Other South African banks are also likely to see one-time earnings fall by the same margin, said Nolwandle Mthombeni, an analyst at Mergence Investment Managers in Cape Town.<\/p>\n

Harry Botha, an analyst at Avior Capital Markets, also expects the country\u2019s diversified lenders to post a similar decline, adding that Standard Bank\u2019s trading update was better than expected.<\/p>\n

Standard Bank will release a detailed first-half earnings report on 20 August.<\/p>\n

FirstRand Ltd., the continent\u2019s second-largest bank, will release full-year earnings in September. Absa Group Ltd. and Nedbank Group Ltd., the smallest of the so-called Big Four, have said interim profit will also drop by at least 20%.<\/p>\n

Capitec Bank Ltd. has guided for more than 70% decline for earnings in the six months through August.<\/p>\n

Standard Bank\u2019s basic EPS probably declined as much as 80% due to accounting charges on the sale of its 20% stake in ICBC Argentina to Industrial and Commercial Bank of China and the impairment of some IT costs, it said.<\/p>\n

\n

Read: South Africa\u2019s biggest bank sends out coronavirus warning<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Shares of Standard Bank Group rose the most in three weeks after a decline in first-half profit was less severe than expected for Africa\u2019s largest lender.<\/p>\n","protected":false},"author":59,"featured_media":198064,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[961],"tags":[26],"class_list":["post-420902","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-banking","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/420902","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=420902"}],"version-history":[{"count":2,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/420902\/revisions"}],"predecessor-version":[{"id":420932,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/420902\/revisions\/420932"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/198064"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=420902"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=420902"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=420902"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}