Standard Bank Group started 2025 with a strong financial performance, reporting a 10 percent increase in headline earnings in rand terms despite ongoing currency volatility and global economic challenges.
Group Chief Executive Sim Tshabalala said on June 19, that when measured on a constant currency basis, earnings growth was even stronger, rising by the mid-teens.
This demonstrates the bank’s resilience in managing persistent macroeconomic pressures, including fluctuating exchange rates and geopolitical uncertainties.
The Group’s return on equity remained solid within the targeted 17 to 20 percent range, highlighting the institution’s profitability in the face of volatile exchange rates and unpredictability in the geopolitical landscape. Recognised as a short-term obstacle, currency volatility is predicted to have a lesser effect in the second half of the year.
Diversified business model
A diversified business model helped Standard Bank maintain a strong performance across its operations in South Africa and throughout Africa.
Balance sheet growth was reportedly slower than expected, although operational momentum was maintained.
This slowdown can be partially ascribed to the timing of changes in monetary policy, specifically postponed interest rate reductions that have reduced demand for credit.
Comparing the same period in 2024 to this one, net interest income stayed largely unchanged. On the other hand, fee and commission revenue grew steadily, which was indicative of a growing clientele and robust activity in the advisory and transactional sectors.
The bank believes this development is consistent with seasonal financial trends seen in the early part of the year, as operating expenses grew at a slightly faster rate than revenue.
The management reiterated that cost discipline is a top priority, and they expect the cost-to-income ratio to improve in the upcoming quarters.
Risks of microeconomic and geopolitical factors
Standard Bank reaffirmed its forecast for mid-to-high single-digit revenue growth from 2025 onwards. In addition to keeping return on equity within the predetermined target range, the Group is still dedicated to maintaining or increasing its cost efficiency metrics.
Although the Group acknowledged the risks of macroeconomic and geopolitical factors, such as changes in international trade policy and instability in the region, it expressed confidence in its capacity to adjust to changing circumstances and sustain strategic growth.
The August 2025 release of interim results is anticipated to shed more light on performance trends. Nevertheless, the Group pointed out that compared to the same time in 2024, which was marked by exceptionally impressive outcomes, the rate of headline earnings growth may slow.