Stancharth Kenya anticipates a drop in profits due to a Sh7b pension payment obligation.
Standard Chartered Kenya Braces for 25% Profit Drop Due to Pension Dispute
Standard Chartered Bank Kenya Ltd has announced a projected 25% fall in its 2025 full-year net profit, attributed to a Sh7 billion financial provision linked to a pension dispute.
The bank's Board Chairperson, Kellen Kariuki, confirmed the profit warning, which was issued in accordance with Kenyan capital markets regulations. The warning is based on the bank's unaudited financial results for the period that ended in August 31, 2025, and internal forecasts to the year-end.
The pension dispute is related to the judgment in "Abdalla Osman and 628 Others versus the Retirement Benefits Authority & 11 Others." The bank's Kenyan unit has initiated the process of collecting information from the 629 appellants involved in the dispute, but specific names or identities have not been publicly disclosed.
The Standard Chartered Kenya Pension Fund has also announced its intention to verify and process the claims of the appellants. However, no new information about the bank's adequacy to meet the obligations from the pension dispute was provided.
The bank's statement reiterates its commitment to its strategy of combining cross-border capabilities with leading wealth management expertise underpinned by sustainability. The payments related to the pension dispute will impact the bank's overall costs in line with the IAS 19 accounting standard for employee benefits.
It should be noted that no new information about the bank's net income for the year ending December 31, 2025, or the impact of the pension dispute on the bank's overall costs was provided in this announcement.
In a positive note, StanChart Kenya had reported a net profit of Sh20 billion for the year that ended in December 2024, a 45% increase. Despite the projected decline in 2025, the bank remains adequately capitalized to meet the anticipated obligations from the pension dispute.
No new information about the bank's 2024 net profit or the expected decline in its 2025 net earnings was provided in this announcement. The bank did not comment on any potential recovery plans or strategies to mitigate the impact of the pension dispute on its financial performance.
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