Standard Chartered Plc, the U.K. bank that earns most of its profit in Asia, expects to open 100 new branches in Africa by 2016 to benefit from the continent’s $1 trillion of annual retail spending.
The lender opened 27 new outlets last year and will also “invest heavily” in digital technology over the next four years, Raheel Ahmed, Dubai-based head of consumer banking for the Middle East, Africa and Pakistan, said in e-mailed comments yesterday. The bank will focus on small and medium-sized companies and private banking, he said.
“There is so much growth potential, particularly where economies are growing rapidly,” Ahmed said. “In Nigeria, only 14 or 15 percent of the people have bank accounts,” he said.
Standard Chartered’s operating revenue at its Africa consumer banking unit rose 9.4 percent in the first half to $257 million. Economic growth in Sub-Saharan Africa will accelerate to 5.1 percent this year and 5.9 percent next year from 4.9 percent in 2012, according to the International Monetary Fund.
The bank posted a 24 percent drop in first-half profit to $2.18 billion after a $1 billion write-down of its Korean business. Revenue rose 6.6 percent as growth in Hong Kong and India helped offset declines in Korea, Singapore and China.
Standard Chartered’s income from retail banking in Africa, including credit cards and personal loans, is growing helped by expansion in Kenya and Botswana, Ahmed said. Income in Ghana grew 32 percent and in Zambia by 45 percent in the first half, he said. The bank has a “high single digit” market share in consumer banking in most countries on the continent in which it operates and more than 10 percent in some, he said.
The lender also expects to benefit from growing trade between Africa and China, which it forecasts to rise to $1.7 trillion by 2030 from $200 billion in 2012. Standard Chartered’s presence in Asia, the Middle East and Africa will help it connect companies and help facilitate trade, Ahmed said.