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StanChart values Africa, Middle East units on sale at Sh216 billion


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StanChart values Africa, Middle East units on sale at Sh216 billion


Standard Chartered Bank on Kenyatta Avenue in Nairobi. FILE PHOTO | EVANS HABIL | NMG

British multinational lender Standard Chartered Plc has valued the assets in the markets it plans to exit in Africa and the Middle East at $1.63 billion (Sh216.6 billion).

The London Stock Exchange-listed firm is pulling out of the markets that include Angola, Cameroon, Zimbabwe, Gambia and Sierra Leone, Jordan and Lebanon to focus resources on others in the regions that are more profitable while simplifying the group’s business that spans Africa, the Middle East, Asia, Europe and America.

Standard Chartered said in its 2022 annual report that the assets and liabilities of the units have been placed under the ‘held for sale’ classification, which signals that they are available for immediate disposal and that a sale is highly probable.

The move, once done, will leave its Kenyan and Nigerian subsidiaries as its most important units on the continent. The Kenyan unit contributed 10 percent of the group’s earnings from Africa and the Middle East last year.

“Following a decision by the Board of Directors to exit certain markets in Africa & Middle East, the assets and liabilities of those markets have been moved to ‘Held for sale’… the transactions are expected to complete in 2023,” Standard Chartered Plc said in its annual report.

Out of the $1.63 billion assets held by the units to be disposed of, the bulk ($1.39 billion/Sh185 billion) are in the form of financial assets such as loans to customers and other banks, cash and balances at central banks, and debt securities.

Property, plant and equipment accounts for $174 million (Sh23.2 billion), with the balance in the form of goodwill and other assets.

StanChart also disclosed that the liabilities of the units stood at $1.307 billion (Sh174 billion) by the end of last year, with customer deposits accounting for $1.21 billion (Sh161.3 billion) out of this amount.

The multinational’s presence in Africa will drop to 10 from the current 15 countries once the sale goes through. It will continue operating in Kenya, Tanzania, Botswana, Mauritius, Uganda, Nigeria, Zambia, Cote d’Ivoire, Egypt and Ghana.

In Tanzania and Cote d’Ivoire, the retail banking business will be sold and only corporate and institutional banking will be retained.

The lender will, however, continue to serve corporate and institutional clients and facilitate cross-border capital flows and offshore business in all the markets it is exiting.

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