Profits jump at South Africa bank

Africa's largest bank, the Standard Bank of South Africa, enjoyed a 32% rise in profits in 2007.

The bank called it "a momentous year" in which it had "weathered the global financial stresses".

Profit after tax was 16.57bn rand, (£1.07bn; $2.11bn), up from 18.36bn the year before.

Standard Bank reported strong growth in loans as the number of personal and business current accounts grew, while the number of mortgages also rose.

"The group's strategy of building revenue streams in other emerging markets started to show results in 2007," a company statement said.

Standard Bank's home market of South Africa accounted for a 15% growth in earnings. But businesses in the rest of Africa increased their contribution by 58% and those outside Africa by 98%.

Expansion

The group has recently been on a shopping spree, buying a number of other banks to expand the business.

In 2007, it completed the acquisition of Argentina's Bank Boston, IBTC Chartered Bank in Nigeria and Kenya's CFC Bank.

The Industrial and Commercial Bank of China (ICBC) bought a 20% stake in Standard Bank for $5.5bn (£2.7bn) late last year.

Co-operation between the two banks is expected to boost Standard Bank's revenues by $50m in 2008, rising to $180m annually by the third year of the deal.

But the bank's earnings per share will be "diluted" in the short term because of new shares issued under the China deal, it said.

Standard Bank hinted at further expansion to keep the company growing in "deteriorating" market conditions.

"The group will focus on identifying suitable capital deployment opportunities for the capital inflow arising from the transaction with ICBC," the said from Johannesburg.

Standard Bank operates in 18 African countries as well as 20 outside the continent, focusing on emerging markets.

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