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SBK
SBK
SBK - Standard Bank Group Limited - Financial information supplied to SASBO
Standard Bank Group Limited
(Incorporated in the Republic of South Africa)
(Registration number 1969/017128/06)
South African Share Code: SBK
Namibian Share Code: SNB
ISIN: ZAE000109815
("Standard Bank Group" or "the group")
Financial information supplied to SASBO
In terms of a court order made on Friday 12 November 2010, Standard Bank Group
was required to supply SASBO, the recognised union for Standard Bank employees
in South Africa, certain information relating to the current rationalisation
process being undertaken by the group in Johannesburg and London. South African
law requires the disclosure of pertinent financial information in order for
SASBO to meaningfully represent its members in the rationalisation process. The
calculation of the impact of this process is at an early stage and the following
information should therefore be regarded as preliminary and should not be viewed
by shareholders as a comprehensive and final announcement of the financial
impact thereof.
It is currently estimated that the cost rationalisation process being undertaken
in Johannesburg and London will result in non-recurring rationalisation costs of
approximately R490 million, a portion of which relates to consultations between
affected employees and the group that remain in progress as of this date and,
accordingly, this figure may decrease. These costs will be accrued in full in
the current financial year which ends on 31 December 2010.
It is currently estimated that the costs that have so far been eliminated from
the group`s 2011 budget as a consequence of the rationalisation process in
Johannesburg and London amount to a total of approximately R2.3 billion. The
estimated costs to be eliminated comprise:
- a reduction in direct staff costs of approximately R770 million;
- a reduction in other operating costs, in the form of:
- reduced expenditure on sponsorships and other marketing costs of R350
million;
- Information Technology (IT) projects cancelled, deferred or scaled-back
at this preliminary stage in our budget process, amounting to approximately R585
million. This number may increase as we complete the budget process;
- reductions in travel and entertainment costs of R25 million;
- optimisation of training centres yielding cost reductions of
approximately R60 million; and
- reduced costs relating to contractors whose contracts will not be
renewed of approximately R480 million.
The information contained in this announcement has not been reviewed by or
reported on by the group`s auditors.
Johannesburg
17 November 2010
Lead sponsor
Standard Bank
Independent sponsor
Deutsche Securities (SA) Proprietary Limited
Date: 17/11/2010 10:08:01 Produced by the JSE SENS Department.
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