Follow us Now on Telegram ! Get daily 10 - 12 important updates on Business, Finance and Investment. Join our Telegram Channel https://t.me/InvestmentGuruIndia
Download Telegram App before Joining the Channel
JOHANNESBURG- Standard Bank said on Wednesday credit impairment charges were "significantly higher" in the three months to March 31 compared to a year earlier, as the impact of the coronavirus hit its customers.
The bank, Africa's largest by assets, has withdrawn its financial guidance for 2020 amid the outbreak of the virus and a nationwide lockdown in South Africa that is expected to have dire consequences for the continent's most industrialised economy.
A number of the lender's other markets have also announced lockdowns or imposed restrictions.
"Credit impairment charges for the period were significantly higher than in the prior year," Standard Bank said in a statement giving an overview of its performance.
While it said this was in part driven by a deterioration in the performance of its lending portfolio, it added much of the stress on individuals and businesses had not emerged by the end of the period and therefore provisions were based on its best estimate at the time.
Earnings attributable to ordinary shareholders were down 27% in the first quarter and Standard Bank said it had seen slow growth in its net interest income, while non-interest revenue, from transaction fees for instance, grew.
South Africa's economy had already slipped into recession at the end of the year, and many consumers and firms have been left struggling after years of stagnant or shrinking growth.
President Cyril Ramaphosa on Tuesday announced a 500 billion rand ($26.41 billion) stimulus package to provide some relief, which included a 200 billion rand loan guarantee scheme to be channelled via the banks. The full details have not been announced but it will likely see the government and banks share losses.
($1 = 18.9288 rand)
(Reporting by Emma Rumney. Editing by Carmel Crimmins)