Standard Bank Group (SBK) investor relations material

Macroeconomic and Operating Environment

• Global and regional uncertainty persisted, with higher energy prices, geopolitical tensions, and trade policy issues impacting growth and inflation expectations.

• IMF raised 2026 global inflation forecast to 4.4% and lowered GDP growth to 3.1%; sub-Saharan Africa's GDP growth forecast was also reduced.

• South Africa benefited from structural reforms, improved fiscal trajectory, and resilient terms of trade, leading to positive credit rating outlooks and a 25bps repo rate hike to 7.0%.

• Inflation in South Africa rose to 4.5% in May 2026, with no further rate hikes expected this year.

• The rand strengthened against most African currencies except the naira and kwacha.

Business Performance and Financial Trends

• Net interest income and non-interest income grew on strong balance sheet expansion, higher client activity, and a growing client base, especially in investment and business banking.

• Cost growth matched revenue growth, reflecting disciplined cost management and ongoing investment in operational efficiency.

• Credit impairment charges were lower period on period, but are expected to rise later in the year due to loan growth and higher charges in H2.

• Credit loss ratio was around the midpoint of the 70-100bps range, with lower charges in CIB and business banking, but higher in personal banking.

• Trading revenue remained strong, benefiting from elevated market volatility and market-making opportunities.

Segment and Regional Performance

• Insurance and asset management earnings momentum continued, supported by improved risk experience and asset growth in South Africa and Nigeria.

• ICBCS contributed positively, driven by trading profits in precious metals.

• Africa Regions portfolio diversity offset softer performance in South and Central Africa, with growth in West and East Africa.

• South African franchise maintained positive momentum, with strong commercial loan growth outpacing the industry and competitive client offerings.

• Home loans growth remained subdued due to aggressive pricing competition, with a focus on profitability over volume.