The Johannesburg-based financial services group reported headline earnings of R26.1 billion ($1.62 billion) for the six months ended June 30, representing a 10% increase from the corresponding period last year.
The result was accompanied by a stronger return on equity and continued improvement in the group's cost and credit metrics, highlighting the benefit of its diversified operations across South Africa and the rest of the continent.
The board declared an interim dividend of 902 cents per share, a 10% increase and the largest interim dividend in the group's history.
Group chief executive Sim Tshabalala said the performance reflected the strength of the bank's diversified franchise and disciplined management of costs and credit.
“Standard Bank delivered a strong performance in the first half of 2026. Strong client-led growth in non-interest revenue, together with disciplined cost and credit management, supported growth in headline earnings and our highest return on equity under the Basel III capital framework,” he said.
Tshabalala said operations outside South Africa remained an increasingly important contributor to the group's earnings, with Africa Regions accounting for 40% of headline earnings during the period.
“Africa Regions contributed 40% of Group headline earnings, while our South African business delivered strong earnings growth and a substantial improvement in ROE,” he said.
Fee income provides a key earnings boost
While net interest income continued to grow, the strongest momentum came from the group's non-interest revenue businesses.
Net interest income from banking operations increased 4% to R53.6 billion, helped by healthy deal activity in Corporate and Investment Banking and modest loan growth across the business and personal banking operations.
The increase was achieved despite pressure on the group's net interest margin, which narrowed to 472 basis points, from 489 basis points a year earlier.
The decline reflected the lower interest-rate environment as well as competitive pricing pressure in some retail and business portfolios.
Non-interest revenue, by contrast, gained momentum. Net fee and commission revenue increased 7% to R18.4 billion, supported by higher transaction volumes, stronger corporate debt-financing activity and increased activity among clients in both business and personal banking.
Trading revenue also rose 8%, adding to the group's overall income growth.
The combination of stronger income and disciplined expenditure resulted in positive jaws of 44 basis points, meaning income growth outpaced the rise in costs. The group's cost-to-income ratio consequently improved to 49.3%.
Credit losses fall sharply
A marked improvement in credit performance provided another major boost to profitability.
Credit impairment charges fell 12% to R7.1 billion, as credit performance improved across the group's loan portfolio.
The credit loss ratio declined to 73 basis points, from 93 basis points in the first half of 2025, indicating a lower level of bad-loan charges relative to the group's total lending.
The improvement in credit quality, alongside stronger revenue generation, helped lift the group's return on equity to 19.8%, compared with 19.1% a year earlier.
The latest figure places Standard Bank comfortably within its 2028 target range of 18% to 22%.
Corporate banking leads business-unit performance
All major business units delivered healthy returns during the period.
Corporate and Investment Banking recorded a 15% increase in headline earnings and achieved a return on equity of 24.8%.
Business and Commercial Banking produced the strongest return among the major operating divisions, with an ROE of 36.3%. Personal and Private Banking recorded an ROE of 18.6%, while Insurance and Asset Management achieved 21.1%.
South Africa remained the group's largest contributor, generating R13.4 billion, or 51%, of group headline earnings.
Africa Regions contributed a further R10.4 billion, equivalent to 40% of headline earnings, underlining the growing importance of the group's continental footprint.
Tshabalala said the outlook for South Africa had become increasingly encouraging but argued that sustaining economic momentum would require deeper integration with the wider African economy.
“We are particularly encouraged by the resilient outlook for South Africa. Sustaining that momentum will require the country to deepen its economic integration with the rest of the continent and fully participate in Africa’s growth opportunity,” he said.
He added that the group's financial position remained strong enough to support clients while pursuing growth opportunities across the continent.
“These results demonstrate the strength and resilience of our diversified franchise. Our balance sheet remains strong, and we are well positioned to continue supporting our clients and capturing the opportunities emerging across Africa.”
Sustainable finance expands
Standard Bank also continued to increase its involvement in sustainable finance, mobilising R50.6 billion during the first six months of the year.
That brought the group's cumulative sustainable-finance mobilisation since 2022 to more than R328 billion, moving it closer to its 2028 target of R450 billion.
The initiative forms part of the group's broader strategy to finance economic activity while responding to growing demand for sustainable and transition-related investment across its markets.
Outlook remains positive
Looking ahead, Standard Bank maintained its full-year guidance, with banking revenue expected to grow in the mid-to-high single digits.
The group expects its cost-to-income ratio to edge lower, while the credit loss ratio is projected to remain in the lower half of its through-the-cycle range. Return on equity is also expected to be higher than the level recorded in 2025.
Tshabalala said Africa's economic growth prospects should continue to create opportunities for the group, although the operating environment is expected to remain competitive.
He pointed to the bank's scale, continental reach and diversified client base as key advantages as it navigates intensified competition, changing regulation and rapid technological development.
For now, the first-half numbers suggest Standard Bank is entering the second half of the year from a position of strength, with record earnings, improving credit quality and a higher shareholder payout providing a solid platform for its remaining 2026 targets.