Standard Bank’s Role in SMME Financing
14 June 2000
What does Stanbic stand for?
Standard Bank and its role in SMME
|
SEGMENT |
NEEDS |
OFFERING |
DTI EQUIVALENT |
|
Commercial Banking (30% ) |
|
|
|
|
SME (34%) |
|
|
|
|
Mass Market (35%) |
|
|
|
Standard Bank is a significant player in the SME market and has a large lending book characterised by many small loans
|
Standard Bank's SME Base |
Total |
|
Number of customers |
360,000 |
|
Market share |
34% |
|
% Customers with lending arrangements |
37% |
|
Total lending |
R5.21 b |
|
Overdraft Facilities |
|
|
% Customers Borrowing < R 10,000 |
75% |
|
% Customers Borrowing < R 50,000 |
82% |
|
% Non performing loans |
18% |
|
% Bad debt |
4% |
Black business is becoming an increasing contributor to our SME profitability
|
Total SME Base |
Total |
ACI's |
|
Number of customers |
360,000 |
80,000 |
|
Market share |
34% |
34-38% |
|
% Customers with overdrafts |
34% |
34% |
|
Total value of overdrafts |
R 3,182 b |
R 386 m |
|
% Facility < R 10k (accounts) |
70% |
75% |
|
% Facility < R 50k (accounts) |
92% |
95% |
|
% NPL |
17% |
|
|
% Bad debt |
4% |
Standard Bank makes a large number of loans in the less than R50 000 category to going concerns.
Over 70% of these loans are < R10 000
|
Statistic |
Total Market |
BCI's |
||
|
<R50k |
>R50k |
<R50k |
>R50k |
|
|
Number of Accounts |
115,500 |
8,500 |
32,000 |
1,240 |
|
Rand value of Overdraft Facilities |
939 m |
908 m |
136 m |
89 m |
|
% Non-Performing Loans |
19.1% |
19.0% |
SME overdrafts split across facility size and number of accounts shows that….
[PMG Ed. Note: graph not included]
New SME business continues to reflect a large number of small loans
|
New Business |
Total |
BCI's |
|
Current Accounts opened |
47,000 |
19,740 |
|
Accounts closed |
34,000 |
13,620 |
|
% Accounts with overdrafts |
43% |
38% |
|
Overdrafts approved Rands |
143 m |
44 m |
|
% Facility < R 10k (Accounts) |
75% |
80% |
|
% Facility R 10 - R 50k (Accounts) |
10% |
8% |
|
% Facility R 50 - R 100k (Accounts) |
6% |
5% |
|
Term loans approved (Rands) |
73 m |
38 m |
|
% Facility < R 10k (Accounts) |
5% |
6% |
|
% Facility R 10 - R 50k (Accounts) |
27% |
25% |
|
% Facility R 50 - R 100k (Accounts) |
58% |
59% |
Refers to business approved on accounts opened in 1999
New SME business from the BCI communities is clearly growing
[PMG Ed. Note: graph not included]
Although Khula is small we have increasingly played the leading role in the processing and support of its guaranteed business
|
% Originated |
1998 |
1999 |
* 2000 |
|
By Standard Bank |
19% |
36% |
46% |
|
Demographics |
1998 |
1999 |
2000 |
|
Approved for Whites |
41% |
38% |
|
|
Approved for BCI's |
59% |
62% |
* Performance to May 2000
Our SME staff composition is being strongly transformed
|
SME staff composition |
||||
|
Total |
W |
BCI |
B |
|
|
Rural |
381 |
75% |
25% |
11% |
|
Urban |
575 |
51% |
49% |
16% |
|
Total |
956 |
61% |
39% |
14% |
|
SME manager transformation |
||||
|
Total |
W |
BCI |
B |
|
|
1998 |
44 |
79% |
21% |
3% |
|
2000 |
105 |
74% |
26% |
13% |
We are increasing our deployment of skilled, representative emerging market managers
|
Emerging market managers |
|||
|
Number |
% BCI's |
% B |
|
|
1998 |
8 |
100% |
100% |
|
2000 |
26 |
100% |
92% |
But we have a long way to travel, in driving our proposition to become even more inclusive
In addition, the following obstacles need to be addressed
The way forward necessitates a partnership approach
[PMG Ed. Note: diagram not included]
How do we all contribute?
Standard Bank’s commitment We will……
Stretch the boundaries of SME business to be even more inclusive