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Africa's standard bearer.

Despite the fact that its network in Africa was renamed Stanbic several years ago, the South African banking and financial services group Standard Bank Investment Corporation is still sometimes confused with the UK's Standard Chartered Bank. This is all the more understandable if one considers that their history is intertwined. To clarify the situation once and for all, here is a brief account of the history of the birth and separation of the Standard Bank siblings.

In 1862, the Standard Bank of British South Africa, incorporated in England and established in Port Elizabeth, began its expansion by internal and external growth. In 1883 the bank became The Standard Bank of South Africa Ltd to take advantage of recent gold discoveries in the Transvaal.

Following the 1890 depression, the bank consolidated its position as the leading bank in southern Africa by opening branches in neighbouring territories. It was, in fact, the first bank in both Southern Rhodesia (Zimbabwe) in 1892 and Northern Rhodesia (Zambia) in 1906. Other countries brought into its sphere of activities included the then Portuguese East Africa (Mozambique) in 1894, Bechuanaland (Botswana) in 1897, Basutoland (Lesotho) and Nyasaland (Malawi) in 1901, East Africa (Kenya and part of Tanzania), Belgian Congo (Zaire, then DRC) and Zanzibar in 1911, Uganda in 1912, South West Africa (Namibia) in 1915 and Tanganyika (part of Tanzania) in 1916.

In 1920, the bank bought another imperial bank, the African Banking Corporation, established in 1890. Its administrative office was moved to Cape Town in 1885, to Pretoria in 1954 and finally to Johannesburg in 1959.

By 1961, the bank operated over 200 branches and agencies outside South Africa and South West Africa. The first parting of ways occurred in 1962 when the Standard Bank of South Africa Ltd was renamed The Standard Bank Ltd, and transferred its South African business to a locally incorporated subsidiary which retained the former name.

In 1965, The Standard Bank Ltd acquired the Bank of West Africa Limited (founded in 1894), with over 60 branches in Nigeria, nearly 30 in Ghana and others in Sierra Leone and the Gambia. In 1967, the Standard Bank of South Africa made an initial public offering of shares on the Johannesburg Stock Exchange (JSE).

Severing of links

In 1969, links were further loosen between the London and South African siblings with two major events. First, The Standard Bank Investment Corporation was formed to serve as a holding company for the Standard Bank of South Africa and its affiliates. The company was listed on the JSE the following year. Second, 1969 also saw the merger of The Standard Bank and The Chartered Bank, an Asian bank, by incorporation of Standard and Chartered Banking Group Limited, renamed Standard Chartered Bank plc in 1985.

The final separation was pronounced in 1987 when Standard Chartered Bank sold its 39% share in the Standard Bank Group, making the Standard Bank Investment Corporation a totally South Africa-owned institution for the first time in its 125 years existence. The South African bank, which no longer had a network of its own outside South Africa, immediately started establishing representative offices overseas.

In 1992, its subsidiary Standard Bank London became the first South African bank granted a banking licence in the UK since South Africa's debt moratorium in 1985. The momentum was launched for a second expansion northward. In 1988, Union Bank of Swaziland Ltd, in which Standard Bank had a major shareholding, became an operational commercial bank. Upon Namibia's independence in 1990, the bank's subsidiary there since 1978, Standard Bank South West Africa Ltd, was renamed Standard Bank Namibia Ltd.

Then in 1991 Union Bank of Botswana Ltd was registered as a subsidiary of the group. Soon afterwards the bank established a representative office in Angola (later closed down) and in Mozambique (before a minority interest was acquired in Banco Standard Totta de Mozambique), as well as a small interest in Madagascar' Union Commercial Bank.

In 1992, the bank's Africa Banking Group acquired the operations of ANZ Grindlays Bank in eight Africa countries (Botswana, Ghana, Kenya, Nigeria, Uganda, Zambia, Zaire and Zimbabwe). All the acquisitions, except for Merchant Bank (Ghana) Ltd, were renamed Stanbic Bank in 1993. The subsidiaries in Namibia and Botswana were also renamed Stanbic. In 1994, the bank bought Barclays' subsidiary in Lesotho and, the following year, Meridien BIAO Bank Tanzania, both also renamed Stanbic.

Today, the Standard Bank Group is the leading South African banking and financial services group ranked by profits, assets and market capitalisation, employing more than 32,000 people world-wide. Standard Chartered is an international banking group with over 25,000 people.

One difference between the two banks is that banks trading under the name "Standard Chartered" are generally listed on the local stock exchange. Their "Stanbic" cousins, with the exception of Stanbic Namibia, have not yet dared to make the leap.
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Title Annotation:Standard Bank Investment Corp.; An African Business Special Report
Author:Giorgio, Emmannualle Moors de
Publication:African Business
Date:Apr 1, 1999
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