JOHANNESBURG (Reuters) - Standard Chartered (STAN.L) has opened two new branches in South Africa to target Cape Town and Durban-based companies looking to expand across the continent, its chief executive for Africa said on Tuesday.
The London-listed bank saw 28 percent growth in its South African business last year and is now looking to court local retailers, many of which are based in Cape Town, and trading houses operating in Durban, Diana Layfield told the Reuters Africa Investment Summit.
While Standard Chartered is dwarfed in South Africa by domestic powerhouses like Standard Bank (SBKJ.J) and FirstRand (FSRJ.J), it is looking to use its presence in at least 15 African countries to win business from companies looking north.
“In South Africa, we have seen real opportunity recently,” Layfield said.
Standard Chartered is also scaling up its business in Angola, where it recently inked a deal for a 60 percent stake in a joint venture bank with state-owned insurer ENSA.
The bank is investing a $100 million in Africa aimed at doubling the size of its business in the next five years. Profit from the continent jumped 23 percent to $771 million in 2012.
Layfield also said the bank had submitted a proposal to Harare for Zimbabwe’s so-called indigenization plan.
President Robert Mugabe’s government requires international companies operating in Zimbabwe to hand over a majority stake to black Zimbabweans.
Local press reported on Tuesday that Standard Chartered was one of three companies that could be shut down for non-compliance of the indigenization program, citing Zimbabwe government officials.
“We have submitted a plan to the government we believe complies with the indigenization requirements and now we are discussions with them over that plan. That is all the formal communication we have had,” Layfield said.
South Africa’s Standard Bank (SBKJ.J) said last month it wants to keep a majority stake in its Zimbabwe business.
The indigenization program has drawn criticism from both international investors and some Zimbabwe politicians, including Finance Minister Tendai Biti, who said the program was flawed because most Zimbabweans could not afford to participate.
“The problem with the indigenization model of Zimbabwe is that it’s based on certain fundamental fault lines,” Biti told the Summit on Monday.
“The local people become innocent bystanders to the Indigenization and Empowerment offer.”
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Editing by David Dolan