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Seven-year review

Consolidated balance sheet

    2005   2005   2005   CAGR2   2005   2004 2003 2002 2001 2000 1999  
    US$m   UK£m   €m   %   Rm   Rm Rm Rm Rm Rm Rm  
Assets
                                  
Banking assets   93 353   54 222   78 953   21   593 728   506 020 444 371 307 592 306 196 209 337 185 087    
Cash and short-term negotiable
   securities		   13 970   8 114   11 815   18   88 848   52 787 44 521 48 583 43 908 31 648 32 452    
Trading assets   6 045   3 511   5 113   39   38 446   32 438 33 722 26 781 23 548 9 484 5 414    
Investments   2 885   1 676   2 440   15   18 347   20 068 20 421 18 964 23 804 7 818 7 959    
Loans and advances   52 536   30 514   44 432   19   334 128   258 873 222 100 180 418 178 094 139 089 119 863    
Current and deferred tax assets   142   82   120       902   1 093 803 460 1 322 – –    
Derivative and other assets   17 029   9 892   14 403   37   108 312   136 911 118 715 28 528 31 881 18 274 16 557    
Interest in associates and joint
   ventures		   128   74   108   52   815   296 541 276 187 100 65    
Goodwill and other intangible
   assets		   96   56   81       610   540 508 671 714 216 –    
Property and equipment   522   303   441   3   3 320   3 014 3 040 2 911 2 738 2 708 2 777    
Insurance assets   25 464   14 790   21 536   15   161 950   114 153 96 195 85 761 89 038 75 643 68 866    
Total assets   118 817   69 012   100 489   20   755 678   620 173 540 566 393 353 395 234 284 980 253 953    
Equity and liabilities
                                      
Equity   6 284   3 650   5 314   11   39 964   38 533 35 264 32 060 31 666 25 116 21 079    
Equity attributable to ordinary
   shareholders		   5 178   3 008   4 378   15   32 931   29 064 28 835 26 054 25 685 18 292 14 576    
Preference share capital
   and premium		   470   273   398       2 991   2 991 8 8 8 8 8    
Minority interest   636   369   538   (8)   4 042   6 478 6 421 5 998 5 973 6 816 6 495    
Liabilities   112 533   65 362   95 175   21   715 714   581 640 505 302 361 293 363 568 259 864 232 874    
Banking liabilities   87 931   51 072   74 367   22   559 239   476 153 417 518 283 614 282 694 193 644 173 034    
Deposit and current accounts   64 853   37 668   54 849   17   412 462   322 477 278 899 245 333 241 568 172 136 158 272    
Derivative, trading and other liabilities   20 786   12 073   17 580   48   132 199   140 607 128 560 28 953 31 294 15 272 12 596    
Current and deferred tax liabilities   627   364   530   11   3 988   3 409 2 826 2 415 3 804 2 686 2 131    
Subordinated bonds   1 665   967   1 408       10 590   9 660 7 233 6 913 6 028 3 550 35    
Insurance liabilities   24 602   14 290   20 808   17   156 475   105 487 87 784 77 679 80 874 66 220 59 840    
                                       
Total equity and liabilities   118 817   69 012   100 489   20   755 678   620 173 540 566 393 353 395 234 284 980 253 953    
1The group implemented IFRS from 1 January 2005. As permitted by IFRS, 2004 results have not been restated for IAS 32, IAS 39 and IFRS 4. With the exception of the reallocation of accrued interest to the relevant line items, results prior to 2004 have not been restated for the adoption of other IFRS statements.
2CAGR refers to compound annual growth rate based on rand amounts for the period 1999 to 2005.
Exchange rates utilised to convert the 31 December 2005 balance sheet:US$  –  6,36  (2004: 5,63)
 UK£  –  10,95  (2004: 10,82)
 Euro  –  7,52  (2004: 7,66)

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Consolidated income statement

    2005   2005   2005   CAGR2   2005   2004 2003 2002 2001 2000 1999  
    US$m   UK£m   €m   %   Rm   Rm Rm Rm Rm Rm Rm  
Banking operations
                                    
Net interest income   2 042   1 122   1 642   11   12 987   11 492 11 437 10 520 8 177 7 229 6 761  
Non-interest revenue   2 629   1 445   2 114   16   16 718   15 044 13 091 11 448 9 135 7 430 6 746  
Total income   4 671   2 567   3 756   14   29 705   26 536 24 528 21 968 17 312 14 659 13 507  
Credit impairment charges   190   104   153   (4)   1 207   1 050 1 848 1 955 1 603 1 406 1 527  
Income after credit impairment charges   4 481   2 463   3 603   16   28 498   25 486 22 680 20 013 15 709 13 253 11 980  
Operating expenses   2 644   1 454   2 126   12   16 817   15 384 13 938 12 738 10 005 8 655 8 457  
Net income before goodwill   1 837   1 009   1 477   22   11 681   10 102 8 742 7 275 5 704 4 598 3 523  
Goodwill impairment   4   2   3       24   48 – – – – –  
Net income from banking operations   1 833   1 007   1 474   22   11 657   10 054 8 742 7 275 5 704 4 598 3 523  
Income from associates and joint ventures   31   17   25   65   200   97 102 96 49 16 10  
Net income before indirect taxation   1 864   1 024   1 499   22   11 857   10 151 8 844 7 371 5 753 4 614 3 533  
Indirect taxation   89   49   71   7   565   389 388 382 309 341 381  
Profit before direct taxation   1 775   975   1 428   24   11 292   9 762 8 456 6 989 5 444 4 273 3 152  
Direct taxation   421   231   339   26   2 678   2 484 2 353 2 053 1 447 993 668  
Profit for the year   1 354   744   1 089   23   8 614   7 278 6 103 4 936 3 997 3 280 2 484  
Attributable to minorities and preference
   shareholders		   60   33   48   52   383   124 104 122 77 68 31  
Banking profit attributable to ordinary
   shareholders		   1 294   711   1 041   22   8 231   7 154 5 999 4 814 3 920 3 212 2 453  
Insurance operations
                                    
Net income before goodwill   460   253   370   (1)   2 927   2 848 2 408 1 215 3 401 1 260 3 162  
Goodwill impairment   62   34   50       397   – 63 – – – –  
Net income from insurance operations   398   219   320   (4)   2 530   2 848 2 345 1 215 3 401 1 260 3 162  
Indirect taxation   33   18   27   6   213   262 239 223 185 169 154  
Profit before direct taxation   365   201   293   (4)   2 317   2 586 2 106 992 3 216 1 091 3 008  
Direct taxation   257   141   207   12   1 634   792 823 368 1 123 457 849  
Profit for the year   108   60   86   (17)   683   1 794 1 283 624 2 093 634 2 159  
Attributable to minorities   76   42   61   (17)   482   1 264 904 441 1 488 447 1 522  
Insurance profit attributable to ordinary shareholders   32   18   25   (17)   201   530 379 183 605 187 637  
Group profit attributable to ordinary
   shareholders		   1 326   729   1 066   18   8 432   7 684 6 378 4 997 4 525 3 399 3 090  
Headline earnings   1 331   732   1 070   20   8 464   7 538 6 280 5 263 4 419 3 673 2 892  
Normalised headline earnings3   1 417   779   1 139   21   9 013   7 511 6 280 5 263 4 419 3 673 2 892  
1The group implemented IFRS from 1 January 2005. As permitted by IFRS, 2004 results have not been restated for IAS 32, IAS 39 and IFRS 4. Excluding exceptional items, which have been reallocated and included in the relevant income or expense categories, results prior to 2004 have not been restated for the adoption of other IFRS statements.
2CAGR refers to compound annual growth rate based on rand amounts for the period 1999 to 2005.
3Prepared on a normalised basis (refer to Normalised results for an explanation of normalised results).
Average exchange rates utilised to convert the 2005 income statement: US$  –  6,36  (2004: 6,44)
 UK£  –  11,57  (2004: 11,80)
 Euro  –  7,91  (2004: 8,01)

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Statistics, returns and capital adequacy


  CAGR1                    
  %   2005   2004 2003 2002 2001 2000 1999  
Standard Bank Group
                      
Share statistics                      
Number of ordinary shares in                      
issue (thousands)                      
   Listed on the JSE Limited                      
      – weighted average     1 353 382   1 345 786 1 334 099 1 328 192 1 318 6964 1 295 8414 1 277 0184  
      – end of period     1 352 383   1 352 108 1 338 730 1 331 078 1 324 938 1 309 1794 1 279 3134  
   In terms of IFRS2                      
      – weighted average     1 205 169   1 321 666 1 334 099 1 328 192 1 318 696 1 295 841 1 277 018  
      – end of period     1 206 704   1 252 918 1 338 730 1 331 078 1 324 938 1 309 179 1 279 313  
Dividend cover (times)     2,53   2,5 3,1 3,2 3,3 3,3 3,3  
Dividend yield (%)     3,5   3,5 3,9 4,1 3,3 2,8 2,7  
Earnings yield (%)     9,3   8,7 12,0 13,1 10,7 9,3 8,9  
Price earnings ratio (times)     10,8   11,5 8,3 7,6 9,3 10,8 11,3  
Normalised price earnings ratio (times)3     11,4   11,8 8,3 7,6 9,3 10,8 11,3  
Price-to-book (times)     3,1   3,1 1,8 1,5 1,6 2,2 2,2  
Normalised price-to-book (times)3     2,7   2,7 1,8 1,5 1,6 2,2 2,2  
Share price (cents) – high     7 875   6 750 3 960 3 810 3 605 3 120 2 650  
Share price (cents) – low     5 750   3 686 2 650 2 595 2 600 2 000 1 590  
Share price (cents) – closing 20   7 581   6 580 3 918 3 015 3 120 3 050 2 555  
Number of shares traded (thousands)     841 835   892 633 908 179 673 703 511 549 434 756 401 884  
Turnover in shares traded (%)     62,2   66,0 67,8 50,6 38,6 33,2 31,4  
Market capitalisation (Rm) 21   102 524   88 969 52 451 40 132 41 338 39 930 32 686  
Share statistics per ordinary share (cents)                      
Earnings 19   699,7   581,4 478,1 376,2 343,1 262,3 242,0  
Normalised earnings3 18   663,6   569,0 478,1 376,2 343,1 262,3 242,0  
Headline earnings 21   702,3   570,3 470,7 396,3 335,1 283,4 226,5  
Normalised headline earnings3 20   666,0   558,1 470,7 396,3 335,1 283,4 226,5  
Dividends 26   267,0   231,5 151,0 124,0 102,0 85,0 68,0  
Net asset value 16   2 729   2 320 2 154 1 957 1 939 1 397 1 139  
Normalised net asset value3 16   2 830   2 464 2 154 1 957 1 939 1 397 1 139  
Selected returns (%)                      
Return on equity     27,8   26,0 22,9 20,3 20,1 22,4 20,9  
Normalised return on equity3     25,2   24,2 22,9 20,3 20,1 22,4 20,9  
1CAGR refers to compound annual growth rates for the period 1999 to 2005.
2Shares in issue reduced by shares issued in terms of the Tutuwa initiative and deemed treasury shares held for the benefit of Liberty Life policyholders.
3Prepared on a normalised basis (refer to Normalised results for an explanation of normalised results).
4The number of shares has been adjusted for treasury shares acquired and cancelled in 2001.

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  CAGR1                    
  %   2005   2004 2003 2002 2001 2000 1999
Exchange rates at 31 December                      
US$ 1   6,36   5,63 6,68 8,58 12,00 7,57 6,16  
UK£ 2   10,95   10,82 11,95 13,82 17,45 11,30 9,92  
Euro 3   7,52   7,66 8,42 9,01 10,68 7,10 6,17  
Market indicators at 31 December                      
Prime overdraft rate (%)     10,50   11,00 11,50 17,00 13,00 14,50 15,50  
JSE All Share Index – closing 14   18 097   12 657 10 387 9 277 10 457 8 164 8 357  
JSE Banks Index – closing 15   29 234   22 975 14 153 12 035 12 812 13 697 12 482  
Standard Bank operations2
                      
Selected returns and ratios                      
Headline earnings (Rm) 22   8 145   7 187 6 010 4 965 3 985 3 249 2 428  
Normalised headline earnings (Rm)3 23   8 490   7 156 6 010 4 965 3 985 3 249 2 428  
Return on equity (%)     28,2   27,2 24,0 21,2 19,9 22,1 20,7  
Normalised return on equity (%)3     25,8   25,1 24,0 21,2 19,9 22,1 20,7  
Price-to-book (times)     3,1   3,2 1,8 1,5 1,6 2,1 2,2  
Normalised price-to-book (times)3     2,7   2,7 1,8 1,5 1,6 2,1 2,2  
Normalised return on risk-weighted                      
   assets (%)3     2,9   2,9 2,6 2,3 2,1 2,2 1,8  
Net interest margin (%)     2,93   3,07 3,46 3,22 3,31 3,77 3,94  
Non-interest income to total income (%)     56,3   56,7 53,4 52,1 52,8 50,7 49,9  
Cost-to-income ratio (%)     56,6   58,0 56,8 58,0 57,8 59,0 62,6  
Credit loss ratio (%)     0,41   0,43 0,90 1,07 0,99 1,06 1,27  
Effective tax rate (%)     27,4   28,3 31,0 33,0 30,5 28,9 31,4  
Normalised headline earnings                      
   per employee (rand)3 21   231 449   199 777 171 548 143 876 120 444 107 175 74 394  
Number of employees at year-end 2   36 682   35 820 35 034 34 509 33 086 30 315 32 637  
                       
Capital adequacy4                      
Risk-weighted assets (Rm) 14   318 279   265 148 236 346 225 995 219 773 158 451 142 498  
Tier I capital (Rm) 16   33 553   29 111 25 289 23 277 22 637 16 954 13 680  
Total capital (Rm) 19   45 328   39 722 33 797 31 187 29 669 22 500 16 245  
Tier I capital to risk-weighted assets (%)     10,5   11,0 10,7 10,3 10,3 10,7 9,6  
Total capital to risk-weighted assets (%)     14,2   15,0 14,3 13,8 13,5 14,2 11,4  
1CAGR refers to compound annual growth rates for the period 1999 to 2005.
2Standard Bank Group excluding Liberty Life.
3Prepared on a normalised basis (refer to Normalised results for an explanation of normalised results).
4In accordance with Basel II principles relating to the treatment of insurance entities, insurance operations are excluded from the capital base of the banking group and its related risk-weighted assets. Capital in insurance operations in excess of statutory minimum requirements is not recognised in group capital. Comparatives have been restated accordingly.
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