SNG: StanChart makes $217mln loss on sale of business in Africa
James Anyanzwa
Standard Chartered Plc made a $217 million loss on the sale of its business in Zimbabwe, Angola and Sierra Leone as the British multinational moved to reorganise operations on the continent to maximise returns.
The lender, which is listed on the London Stock Exchange (LSE), says the losses from the sale of the three subsidiaries were largely due to forex translation, with the Zimbabwean unit accounting for the biggest hit.“Net loss on businesses disposed of/held for sale of $232 million includes losses related to the sale of Zimbabwe of $172 million, Angola of $26 million and Sierra Leone of $19 million – all primarily from the recycling of FX translation losses from reserves into the income statement – with no impact on tangible equity or capital, and $15 million loss on the sale of the aviation business,” the lender says in its latest annual report (2024)The group incurred restructuring charges of $441 million, reflecting the impact of actions to transform the organisation to improve productivity, primarily additional redundancy charges, and simplifying technology platforms and optimising the group’s office space and property footprint, of which $156 million related to the Fit-for-Growth programme.
Key marketsIn April 2022, the lender announced intention to leave several African markets – including Angola, Cameroon, Gambia, Sierra Leone and Zimbabwe – and exit thethe Consumer, Private and Business Banking (CPBB) segments in Tanzania and Cote d’Ivoire, driven by a desire to accelerate revenue and return growth by focusing on key markets and businesses.
These markets generated around one per cent of total Group 2021 income and a similar proportion of profit before tax.
In July 2023, the lender and Nigerian Access Bank Plc entered into agreements for the sale of Standard Chartered’s shareholding in its subsidiaries in Angola, Cameroon, Gambia and Sierra Leone, and its CPBB business in TanzaniaThe move followed rival Barclays Plc, which sold most of its stake in Africa, starting in 2016 to reduce the risk and capital burden that came with majority ownership of the businesses.
Standard Chartered is streamlining operations to concentrate resources on most profitable businesses. The exits are part of a plan to streamline operations and enhance focus on its wealth management and cross-border transactions.
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