Measuring our strategic progress
A snapshot of our performance against strategy for 2018
Our strategic value drivers help us focus our efforts and measure our progress on delivering our strategy, across all our business units and corporate functions, and our geographic footprint.
Our clients are at the centre of everything we do. We strive to meet their individual needs by seamlessly delivering holistic, relevant financial services offerings through the channels of their choice.
|Net promoter score (NPS)|
|PBB South Africa channel||70||Met||Continually improve|
|PBB Africa Regions||25||Met|
|Client satisfaction index (CSI)|
NET PROMOTER SCORE
CLIENT SATISFACTION INDEX
Our on-the-ground presence in 20 countries in Africa and client-focused approach, connected by our enhanced IT platforms, supports our large, diverse client base. As we become more digitised and integrated, we are better able to understand our client’s financial services needs and match them with personalised experiences and solutions. We have made progress in improving service delivery across multiple channels, including faster account origination and online lending.
Digitisation has had a significant impact in improving client experience, and the pace at which our business units and clients are leveraging technology continues to gain momentum. Having completed the transformation of our core banking platforms, we have moved our focus to simplifying our IT estate and leveraging our data while continuing to deliver an ‘always on, always secure’ client experience.
Our presence across Africa and in key financial centres around the world provides our clients with access to international markets and capital, supporting our ability to drive Africa’s growth and development. Changes in organisational design are driving greater integration across geographies and financial offerings, be they retail, investment banking, wealth management or insurance, and delivering greater value.
How our people think and feel about their work correlates directly with how satisfied our clients are, and how successful we are in delivering our strategy and performance aspirations.
|Employee net promoter score (eNPS)|
|Standard Bank Group||+23||Met||+24|
|Overall employee turnover rate (%)||8.3||Met||14.41|
|Voluntary employee turnover rate (%)||4.9||Met||9.91|
|Voluntary regrettable employee turnover rate (%)||2.3||Met||–|
1. Gartner CEB Global benchmarks: 2017.
EMPLOYEE NET PROMOTER SCORE
2016: 48 622
2016: 5 726
Our licence to operate is a function of the trust our stakeholders place in us. Our ability to manage the risk inherent in our business and to ensure that our conduct reflects the highest standards of ethical and responsible business practice, underpin that trust.
|Risk (Including Liberty)|
|Common equity tier 1 ratio (CET 1) (%)||13.5||Met||11.0 – 12.5%|
|Liquidity coverage ratio (LCR) (%)||116.8||Met||Minimum of >100%|
|Return on risk-weighted assets (RoRWA) (%)||3.0||Met|
|Net stable funding ratio (NSFR) (%)||118.6||Met||Minimum of >100%|
|Conduct (Including Liberty)|
|We manage conduct risk in accordance with our governance framework and are guided by our values, ethics and principles.|
Risk and conduct
We manage our business and associated risks in a manner that balances the interests of our clients and other key stakeholders with the protection of the group’s long-term sustainability and the stability of the financial systems within which we operate. Our objective to do the right business the right way extends from our compliance with laws and regulations, including the enforcement of measures to combat financial crime, financing of terrorism or other fraudulent practices, to our ethical conduct as individuals and a financial services organisation.
The relationship between regulation and digitisation is complex and sometimes ambiguous. While digitisation strengthens regulatory control by increasing transparency and auditability and reducing manual errors, there is a concern among regulators that it may fail to protect clients and come at the expense of security compliance, risk management and business continuity.
The risk management and audit teams focus on managing this complexity by embracing the vital role of digitisation in the execution of the group’s strategy and understanding the processes of digitisation to ensure that the associated risks are managed in a manner that protects client data and assets without increasing client friction.
Delivering sustainable returns to our shareholders depends on the extent to which our investments in satisfied clients, engaged employees and managing risk and conduct are effective and efficient.
|Headline earnings (Rbn) (Including Liberty)||27.9||Met||Sustainable growth|
|Return on equity (ROE) (%) (Including Liberty)||18.0||Met||18 – 20%|
|Cost-to-income ratio (CTI) (%)||57.0||On track||Approaching 50%|
|Credit loss ratio (CLR) (%)||0.56||On track||80 – 100 bps|
HEADLINE EARNINGS AND ROE
- Group headline earnings (HE) growth reflects strong franchise growth, growing client numbers and growing deposits and loans. Growth was further enhanced by an 11% increase in Liberty HE.
- Currency movements continued to impact the group’s reported results, but less than in prior years. On a constant currency basis, group HE grew by 8%.
- Banking activities’ HE grew by 7% to R25.8 billion and banking activities’ ROE improved to 18.8%, up from 18% in 2017.
- Banking revenue growth remained steady, credit impairment charges decreased significantly while costs were carefully managed in a challenging environment.
- Africa Regions contribution to banking HE increased to 31% from 28% in 2017. The top five contributors to Africa Regions’ HE were Angola, Ghana, Mozambique, Nigeria and Uganda.
- PBB delivered satisfying results with a 10% increase in HE to R15.5 billion, contributing 56% to group HE, up from 44% in 2017. CIB HE decreased marginally to R11.2 billion, and a contribution of 40% to group HE in 2018, down from 44% in 2017.
- Despite the challenging economic environment in South Africa, the Standard Bank of South Africa (SBSA) performed acceptably and maintained HE at R16 billion.
- Liberty earnings attributable to the group were R1.6 billion, driven mainly by an improvement of 42% in operating earnings.
- The group’s share of HE from ICBC Argentina increased by 19%, offset by a poor performance from ICBCS, where the group’s 40% share was a loss of R74 million, down from a profit of R152 million in 2017
In line with our purpose, we believe that financial services done well – with conscience and conscientiousness – can improve the lives of Africans by addressing the pertinent issues that face the continent.
- Improving access and affordability – convenient digital products and services, accessible even without a bank account.
- Rethinking security and collateral requirements for loans.
- Providing consumer education to enable people to manage their finances more effectively.
- Helping our customers save, invest and plan for the future, according to their individual needs.
- Helping Africa’s small businesses access the tools and resources they need to become viable and sustainable.
- Providing financial products designed to meet the needs of SMEs and entrepreneurs.
Working with African governments and development institutions to structure appropriate funding instruments and mobilise funding for crucial developmental infrastructure:
- Transport (roads and railways, ports and harbours)
- Facilitating African trade and investment, particularly in the Africa-China corridor in conjunction with ICBC.
- Supporting early childhood development.
- Supporting improved access to education and improved educational outcomes.
- Improving access to student finance (including Feenix).
- Supporting access to work opportunities and skills development.
- Building and retaining local skills in our countries of operation.
- Development programmes for school leavers.