Company Announcements

Standard Bank Group Limited

The Standard Bank of South Africa Limited

28 March 2024

Availability of the Standard Bank Group and The Standard Bank of South Africa Reporting Suite

Standard Bank Group (SBG)

An electronic version of the group's annual integrated report, governance report, remuneration report, risk and capital management report, sustainability disclosures, report to society and climate-related financial disclosures report have been made available on the following website: https://www.standardbank.com/sbg/standard-bank-group/investor-relations/results-and-reports  

The Standard Bank Group 2024 Annual General Meeting (AGM) will be held on 10 June 2024. The notice of the AGM and proxy forms will be published on 29 April 2024.

The Standard Bank of South Africa Limited (SBSA)

The annual financial statements and the annual integrated report for The Standard Bank of South Africa Limited (the group and company) have been made available on the following website: https://www.standardbank.com/sbg/standard-bank-group/investor-relations/results-and-reports/subsidairies

The group and company further wish to advise that their audit reports were unqualified.

Restatement of Previously Published Results

During the preparation of the 2023 annual financial statements, the following restatements relating to previously published results were noted for both SBG and SBSA:  

1.     During the finalisation of the group results, the group amended its calculation of interest income on stage 3 loans and advances for Personal & Private Banking (PPB) and Business & Commercial Banking (BCB) clients as follows: 

§ Previously, interest income on stage 3 loans and advances was calculated using a portfolio approach. The interest income on the stage 3 loan portfolio was calculated as the difference between the expected discounted and undiscounted recovery cash flows and was unwound on a straight-line basis over the expected period to resolution, being either recovery or write-off ("portfolio straight-line approach"). This modelling approach was utilised as a proxy for IFRS 9 Financial Instruments (IFRS 9) stage 3 interest income recognition requirement.  

§ Going forward, interest income on stage 3 loans and advances will be calculated on a loan-by-loan basis. This change in calculation methodology is not a change in accounting policy. Interest income on stage 3 loans and advances will be calculated by multiplying the net carrying amount of each customer balance (after deducting credit impairments) by the effective interest rate of the loan and advance ("loan-by-loan outstanding balance approach"), which is aligned to the requirements of IFRS 9 stage 3 interest income recognition requirement.   

§ During this change to the loan-by-loan outstanding balance approach, the group identified that by previously applying the portfolio straight-line approach to calculating stage 3 interest income, interest income and income statement credit impairments were erroneously understated by
R1 279 million for the 31 December 2022 reporting period.

§ The group has restated for this impact. The expected credit loss (ECL) provision is not impacted by this restatement, as the correction to interest income and income statement credit impairment each have an equal and opposite impact on the ECL provision.

§ This restatement has no impact on earnings attributable to ordinary shareholders or headline earnings but does impact the relevant ratios (being net interest margin, credit loss ratio, cost-to-income and jaws) which have been restated for this change. Furthermore, this change has no impact on gross loans and advances, balance sheet ECL provisions, coverage or statement of cash flows.

This restatement impact to the income statement line items is detailed below.

For details relating to the impact of the IFRS 17 Insurance Contracts transition on SBG, which is not included above, refer to the SBG annual financial statements.

For further information, please contact:

Marc Hearn

Standard Bank Group Limited
9th Floor
5 Simmonds Street, Johannesburg PO Box 2001
South Africa
Telephone number: +27 11 344 5004

DISCLAIMER

This Announcement is not intended to, and shall not, constitute or contain an offer to sell or solicitation of an offer to purchase the securities referred to herein by any person in any jurisdiction where it is unlawful to make an offer or solicitation. The distribution of the Announcement and the offer or sale of the securities referred to herein in certain jurisdictions is restricted by law. This Announcement may not be used for or in connection with, and does not constitute, any offer to, or solicitation by, anyone in any jurisdiction or under any circumstance in which such offer or solicitation is not authorised or is unlawful.

In the United Kingdom, this Announcement is being distributed only to, and is directed only at, persons who are (i) investment professionals, as such term is defined in Article 19(5) of the U.K. Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended, the Financial Promotion Order); (ii) persons falling within Article 49(2)(a) to (d) ("high net worth companies, unincorporated associations, etc.") of the Financial Promotion Order; (iii) outside the United Kingdom; or (iv) persons to whom an invitation or inducement to engage in investment activity (within the meaning of Section 21 of the Financial Services and Markets Act 2000) in connection with the issue or sale of any Notes may otherwise lawfully be communicated or caused to be communicated.

The securities referred to herein have not been and will not be registered under the US Securities Act of 1933, as amended (the Securities Act), or with any securities regulatory authority of any state or other jurisdiction of the United States, and may not be offered or sold in the United States or to US persons (as such term is defined in Regulation S under the Securities Act) except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the US Securities Act. The issuer of the securities has not registered, and does not intend to register, any portion of the offering in the United States, and does not intend to conduct a public offering of the securities in the United States.

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