* Sees opportunities in consumer, wholesale banking
* Net interest income up 18 percent in 2013
* Pretax profit rises to 13.4 billion shillings
* Shares rise by as much as 2.2 percent
(Recasts, adds outlook, share price)
By Duncan Miriri
NAIROBI, March 25 Standard Chartered Bank of
Kenya expects east Africa's burgeoning middle class to
drive growth in 2014 after it recorded a 16 percent rise in 2013
pretax profit, its chief executive said.
The lender, which is controlled by Standard Chartered Plc
, said its net interest income jumped by 18 percent to
16.8 billion shillings ($194.00 million), driving pretax profits
to 13.4 billion shillings ($154.73 million).
Lamin Manjang, who took over the leadership of the bank this
year after running its business in Oman, attributed the positive
outlook to a range of opportunities across personal, corporate
and project financing.
"On the consumer banking side, the growing middle class
clearly is an area that plays into our focus in terms of
strategy, therefore we see the outlook for 2014 as being quite
positive," the chief executive told Reuters.
He said the bank would also benefit from a range of planned
infrastructure and energy investment projects by the government,
as well as the country's nascent oil and gas sector, that would
bring it new business.
Kenya is racing to alleviate infrastructure bottlenecks by
constructing new roads and a modern railway line. It is also
expanding its main airport in the capital Nairobi.
It is also building new power plants and electricity lines
to meet growing demand for energy and to cut the cost per unit
of electricity, which is viewed as too high.
Manjang said bad loans, which rose to 3.8 billion shillings,
representing 3 percent of gross loans, from 2.2 billion
shillings in the previous year or 2.2 percent of total loans,
had started to improve this year.
Standard Chartered plans to open only two new branches this
year, 50 percent fewer than last year, and instead make
"significant" investments in mobile phone and Internet banking.
"We will give more focus on the digital channels because we
see this as the wave of the future. This is what our clients
want," Manjang said.
Mobile phone-based financial services have helped the east
African nation of 40 million people to raise its financial
inclusion to 70 percent of the population in recent years.
Kenyan banks including the largest lender by depositors,
Equity Bank, and the biggest by assets, KCB,
posted double-digit earnings growth last year, though rising bad
debts curbed earnings.
Standard Chartered raised its dividend per share to 14.5
shillings from 12.5 shillings in the prior year.
Its shares rose by as much as 2.2 percent to 315 shillings
each, after the results, before giving up some of the gains to
trade at 310 shillings each in mid-morning.
The bank launched Islamic banking earlier this month to take
advantage of a low reach in that area. Islamic banking accounts
for about 2 percent of the market, in a country where the Muslim
population makes up 15 percent of the population.
($1 = 86.6000 Kenyan Shillings)
(Editing by Drazen Jorgic and Sophie Walker)