Standard Bank Group Ltd., Africa’s largest lender, completed the sale of an 80 percent stake in its Argentine unit to Industrial and Commercial Bank of China Ltd. as its reverses its expansion strategy in emerging markets.
The Johannesburg-based lender expects a 1.6 billion-rand profit ($180 million) from the deal and will retain a 20 percent shareholding in the bank, it said in a regulatory filing today.
The bank plans to cut costs at its operations outside of South Africa by $100 million a year and will incur one-off costs of about $80 million as part of the rationalization.
“Conditions in our international operations remain very challenging,” the bank said. “We are currently taking action in respect of all aspects of the cost base in these operations so as to secure a sustainable reduction in costs.”
Proceeds from the Argentine sale will be used to boost the bank’s capital reserves and fund growth of its South African operations, the bank said.