ANNUAL REPORT 2019 Here for good

Driving commerce and prosperity through our unique diversity sc.com/gm Here for good

Terms and Conditions apply STRATEGIC REPORT Supplementary information

st August 2020 will be eligible for for be eligible will 2020 August rd August 2020. th December, 2019. December, st Annual General Meeting of Standard Chartered Bank Bank Chartered Standard of Annual General Meeting nd

August 2020 at 11.00 am for the ordinary business of the Company. the ordinary of business the am for 11.00 at 2020 August December 2019 together with the reports of the Directors and Auditors. and Directors the reports of the with together December 2019 2019 for payment dividend approve and declare To Company the of Directors re-appoint To the Directors of remuneration the fix to Board the authorise To Company the of Auditors re-appoint To Auditors the of remuneration the fix to Board the authorise To meeting this to relevant business other any transact To of holding allow to a provision incorporate to Articles Association the of Amendment of a) virtual AGMs. To appoint a new CEO and an Executive Director. an and Executive CEO a new appoint To ended 31 year the for Statements Financial and Accounts Audited the adopt and receive To th Omar F. M’Bai Omar F. Company Secretary Dated in Banjul this 13 day of August 2020. August of day 13 this Banjul in Dated OfBy Order The Board FURTHER NOTICE is hereby given that ONLY those shareholders, who are registered in the the in registered are who shareholders, those ONLY that given hereby is NOTICE FURTHER 3 Monday on business of close Members at as of Register Gambia Limited will be held virtually and streamed live from the Head Office, Banjul on Thursday Office,on Head Thursday Banjul the from live virtually be held will streamed and Gambia Limited 13 NOTICE IS HEREBY GIVEN that the Share Register of members of STANDARD CHARTERED CHARTERED STANDARD members of of Register Share the that GIVEN HEREBY IS NOTICE 10 from public the to be closed will LIMITED BANK Company Secretary Closure Share of Register Members of Omar F. M’Bai Omar F. Notice is hereby given that the 42 the that given hereby is Notice Notice Of Annual GeneralNotice Meeting Standard Chartered Bank Gambia Limited dividend payment for the year ended 31 year the for payment dividend By Order OfBy Order The Board Dated in Banjul this 13 day of August 2020. August of day 13 this Banjul in Dated • • • • • • • a upon and attend to proxies more or one appoint may vote and attend to A member entitled company. the be a member of need not A proxy her stead. his/ in vote poll • • Who we are

Standard Chartered is a market-leading financial service brand in The Gambia and has been operating since 1894. It was the first Bank to introduce Automated Teller Machines in the Country. The Bank also boast of 12 ATMs which accepts VISA cards and 4 branches in prime locations such as Banjul, Serrekunda, Kairaba Avenue, Basse and an agency in Senegambia.

Our heritage and values are expressed in our brand promise, Here for good.

The Bank is made up of client segments supported by Functions.

Belt & Road Relay The photographs on the cover of this Annual Report were taken during our global Belt & Road Relay, which took place over 90 days, made a stop in Gambia on Thursday 19th April 2019. 8 employees, representing our four global regions, ran across 44 markets in the world’s first global running event of its kind. Read more on page 22. For more information please visit sc.com/gm

Standard Chartered Bank Gambia Limited 4 Annual Report 2019 STRATEGIC REPORT Supplementary information 5

Independent Auditor’s report Independent Auditor’s Income statement income comprehensive other of Statement position financial of Statement Statement changes of in equity Statement cash of flows statements financial the to Notes Five year summary Board Directors of Team Management governance Corporate Report Directors’ Our purpose What do we statement Chairman’s review Chief Executive’s Business model Our strategy review Controller’s Financial Client segment reviews responsibilities & Stakeholders CONTENTS 113 58 56 57 53 54 55 50 38 42 45 36 20 27 30 14 16 08 12 06 07

Financial statements Financial

Supplementary Information

Corporate governance Corporate

Strategic report Strategic Contents OUR PURPOSE AND PROGRESS Delivering our strategy We have continued to execute our refreshed strategic priorities, which were announced in February 2019. We have made good progress in the year and we are on track to deliver our objectives. We gauge our annual progress against a set of bank key performance indicators (KPIs), a selection of which are shown below, as well as client segment KPIs, some of which are shown on pages 29 to 31. Our bank KPIs include non-financial measures reflecting our continued commitment to integrate sustainability across our business by focusing on sustainable finance, being a responsible company and promoting inclusive communities. Our 11 Sustainability Aspirations, aligned to the UN Sustainable Development Goals, provide tangible targets to drive sustainable business outcomes.

FINANCIAL KPIS NON-FINANCIAL KPIs

Return on equity Return on Capital adequacy ratio Diversity and inclusion: tangible equity women in senior roles 43% 52% 65% 46% 2019 2019 2019 2018 : 52%

ExCo 22% 22% 39% 40% 2018 2018 2018 2018 : 50%

OTHER FINANCIAL MEASURES

Operating income Earnings per share Profit before Tax GMD442m GMD1.25 GMD343m 2019 2019 2019 GMD424m GMD0.58 GMD146m 2018 2018 2018

Standard Chartered Bank Ghana Limited 6 Annual Report 2019 STRATEGIC REPORT Corporate governance Financial statements Supplementary information 7 Manages the Bank’s and communications with engagement stakeholders in order to protect and promote the Bank’s reputation, brand services.and Corporate Affairs Corporate & Brand and Marketing Internal Audit Internal function independent An whose primary role is to help the Board and Executive Management to protect the assets, reputation and the of sustainability Group. Other Banking GMD119 m Operating income Technology & Innovation Bank’s for Responsible operations, systems development and infrastructure. technology Legal Legal sustainable Enables the protects and business legal-related from Bank risk.

income Statutory basisStatutory Underlying basis Total operating Total GMD442m GMD442m Conduct, Financial Financial Conduct, Crime and Compliance sustainable Enables business delivering by the right outcomes for our clients and our markets by highest the driving conduct, in standards fighting financial crime and compliance. Risk the for Responsible our of sustainability good through business management of risk across the Bank and is business that ensuring with line in conducted expectations. regulatory

Human Resources business Enables performance through developing recruiting, colleagues. engaging and Finance Finance, Incorporates and Chain Supply Property. Responsible for all client client all for Responsible operations, end-to-end, and ensures the needs of our clients are at the centre of our The framework. operational function’s strategy is consistent by supported performance metrics, standards and practices that outcomes. client to aligned are Operations

Retail Banking Serving and individual clients businesses. small Serving large corporations, governments, banks and investors. Operating income Global Banking FUNCTIONS OUR CLIENT SEGMENTS GMD203m Operating income

Our client facing businesses are supported functions, by which ensure work operations day together to to day banking regulations. with compliant are and run smoothly GMD120m At StandardAt Chartered Bank Gambia Limited, our purpose drive is to commerce and prosperitythrough our unique diversity. offer We banking services that help people and companies succeed, creating wealth and growth for our clients. Our heritage and values are expressed in our brand promise,Here for good.

How we are organised are we How Who we areWho we and what do we How do we it Strategic report Chairman’s statement

Chairman’s statement Driving more profitable and sustainable growth

Alpha A. Barry I’m delighted to share our 2019 digitization eventually. Chairman Annual Report, which shows how we We aspire to pioneer sustainable have delivered against our strategic banking in The Gambia, through priorities and how we are building our products that will assist businesses business to create sustainable “We have taken that protect the environment and growth for our clients whilst uplift communities as we continue to some significant maximising long-term value for our exemplify sustainable development. shareholders. steps to lay the We are living our Here for good The transformation we embarked on promise and continue to stand foundation to from the previous year is starting to behind the communities we operate yield benefits and creating a better digitise some of in by, and more efficient institution with our services in the higher growth potential. Our financial ¼¼ Conducting a thought leadership performance reflects the increasingly forum on The Gambia Economic coming year and challenging business environment. Outlook focusing on The National to gradually move However, we remained focused and Development Plan and The resilient which assisted us to deliver a National Budget. to full digitization profitable financial year. Our progress ¼¼ Promote diversity and inclusion by eventually”. also allows us to continue to invest in hosting a Breakfast Meeting in our quality, people and technology as Celebration of International we respond to the needs of our Women’s Day, it was part of our valued clients. efforts to enhance gender equality We have taken some significant steps and women empowerment. to lay the foundation to digitise some ¼¼ Refurbished McCarthy Square of our services in the coming year roundabout and launched the and to gradually move to full start of a cleaning exercise for the

Standard Chartered Bank Gambia Limited 8 Annual Report 2019 STRATEGIC REPORT Corporate governance Financial statements Supplementary information 9 2100bps 43% 2019

2018 22% 2017 22% to Deliverto a positive return on shareholders’ loyalty, our staffloyalty, members for their investors and shareholders for their During this very challenging time we Chairman to service.to also We thank our transmission, we have implemented implemented have we transmission, Alpha A. Barry valued clients for their support and Our primary focus remains the health health the primary remains Our focus renewed commitment and devotion minimise the risk virus of measures for our employees and and well-being our of employees and a series preventative of health confidence thein bank. extend our sincere gratitude our to clients. To best ensureclients. safety To and to clients visiting our premises, based on WHO and government guidance. 19 June19 2020 Return on equity (ROE) Aim a per as profitability measure through investment centage shareholders’ of Total equity. 3000bps 2019 52% 22% 2018 2017 22% to deliver sustainable improvement in improvement sustainable deliver to Financial KPIs Financial on return Underlying equity (ROTE) tangible Aim of a percentage as profitability Bank’s the equity tangible shareholders’ however is clouded the global by increase value you our to Bank continue give their to full Factoring our good performance good our and Factoring the 2019 financialyear. the 2019 Dividend forward Moving We had a good year in 2019 despite had a goodWe year in 2019 will continue push to for efficiency proud how every of individual in the recommending dividend a payment macro-economic environment, we we environment, macro-economic pandemic that led severe to performance. support management. I am very shareholders, the Board is some the of challenges in the and uphold our valued behaviours. valued our uphold and and sustainable growth. 2020 given our continued commitment to 50 bututsof per ordinary share for expect reflect this to in our dedication, commitment to clients clients to commitment dedication, disruptions our activities to and we Bank donated brooms, rakes, families, communities and and communities families, they can play active roles in their than100 rubbish binsthan100 that are were trained in 2019 through were trained in 2019 whole Independence of drive. The Our Goal programme continues to providegirls with financial seven partner schools. stationed along the road. economies. A total of 1,502 girlseconomies. 1,502 of A total education and life skills so that cleaners to be cleaning the street the cleaning be cleaners to dust pans, gloves and more Additionally, we enlisted twenty enlisted we Additionally, ¼ look enhance to for ways good Monitoring Board effectiveness is is effectiveness Board Monitoring Bank Gambia Limited will continue to to adaptto our potential deliver to the right way. Enhanced governance and and governance Enhanced Improving our potential our Improving We understandWe the challenges ahead, very important, as a board always we Our medium growth longer-term to 2019. We have maintained have We a good 2019. productivity. The Board continues to priorities. In the coming years aim we performance and focused on potential has continued improve in to sustainable growth. sustainable as a bank opened have we change to and with that brings along better challenge management be more to cost effective and grow our profit. to executing our refreshed strategic governance, arewe committed to business doing to and conduct good deliver on our brand promise and culture ¼ The Board Standard of Chartered Goal, Standard Chartered’s global education programme for adolescent girls and young women

The Goal programme aims to provide girls with financial education and life skills so that they can play active roles in their families, communities and economies. Goal involves team sports and a life skills curriculum delivered in schools. In 2019, Standard Chartered trained 1,502 girls in The Gambia from seven partner schools (St. Joseph’s Senior Secondary School, The Gambia Senior Secondary School, Latrikunda Upper Basic School, Bakau Upper Basic school, Greater Banjul Upper Basic School, St Augustine’s Lower Basic and St Thereses Upper Basic School).

Standard Chartered Bank Gambia Limited 10 Annual Report 2019 STRATEGIC REPORT Supplementary information Here for good Here MONTH/YEAR END UNTIL VALID FROM ٤٥٥٤

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VALID FROM ٤٥٥٤ sc.com/gm Terms and Conditions apply Terms Standard Chartered Visa Debit Card. Chartered Standard Shop safe, Pay safe online with your C Strategic report Chief Executive’s review

Chief Executive’s review Delivering sustainable, high-quality growth

Olukorede Adenowo Chief Executive Officer

Last year we committed to our long-standing relationships and refreshed strategic priorities, to drive improve the quality of our services “We are proud of operational efficiency, productivity and solutions. After turning around and to generate respectable revenue our performance in 2018, we made the progress in whilst exercising the required financial tangible progress against each of our driving great client discipline. We are pleased to deliver strategic priorities in 2019. on those commitments. ¼¼ Through global banking we are experience, better We began 2019 with great optimism supporting trade and investment job satisfaction following a good financial by delivering our global network to performance in 2018, the bar was our client in The Gambia and for our colleagues already set high however we needed Senegal to keep the promise made to our and improved ¼¼ We are growing our affluent client shareholders to deliver a positive business, helping our individual community outcome. clients prosper engagement By focusing on the things within our ¼¼ We are gradually stepping up our control and keeping a close eye on digitisation and innovation efforts, activities” the areas in which we are most transforming how we serve our differentiated, we grew underlying customers earnings per share by 117% per cent and generated a further significant ¼¼ We made encouraging progress improvement in our return on tangible and grew operating profits in 2019 equity (RoTE) by 30%. by GMD 197M to GMD 343M ¼¼ Our Retail Banking underwent From turnaround to significant transformation to transformation enhance growth in the liabilities Our primary responsibility is to give and assets portfolios. The our clients the best banking reintroduction of personal lending, experience by building deep and improved card services and better

Standard Chartered Bank Gambia Limited 12 Annual Report 2019 STRATEGIC REPORT Corporate governance Financial statements Supplementary information 13

Olukorede Adenowo Adenowo Olukorede Chief Executive Officer June19 2020 as saw we the collapse Thomas of Cook, which impacted the tourism sector and had a direct impact on the As brace we economy. ourselves for impact economic negative the anticipated due the global to in 2020, pandemic, will we continue be to vigilant and assist our clients and current the through go to employees challenges Thankour Board you to Directors, of management and staff for their continued perseverance and hard work in delivering favorable results. I am confidentthatteam the will continue deliverto on our commitments in 2020. Conclusion was a good year for our 2019 operations in The Gambia. We delivered on our promise and ensured shareholders dividends.our paid are The year however had its challenges we canwe lead locally, the way leveraging the unique diversity our of network. and products, people, It is our commitment remain to a leader supporting in sustainable development, continue we to embrace efficient effortsto make our We sustainable. more communities will work achieving towards this goal business our conducting by responsibly, refresh our aspirations to their transitioned have who clients sustainable. more be to business firmlyWe believethat this approach is the right direction take and to reflects directly that for which to Standard Chartered Are stands: Here We For Good.. focus on employee banking. employee on focus Confidence in The Gambian economy Gambian economy The in Confidence andwas stronger compared 2018 to sawwe a higher level activity of from the second quarter the fourth to economic Gambian The quarter. Servicesgrowth in 2019, stood at 6% supported 10%, grew by by wholesale and retail trade this helped which business Banking Global our focuses on corporates, governments and financial institutionsto contribute our towards overall GMD120M revenue. Culture and sustainability and Culture made have significantWe progress on our desire drive to an inclusive, innovative performance culture that good and sustainability on focuses conduct. are proudWe the of progress in driving great client experience, better job satisfaction for our colleagues and community engagement improved activities. demonstrated have We how Strategic report Business model

Business model Built on long-term relationships

We have a sustainable approach to business and strive to achieve the highest standards of conduct. Our business model and strategy focuses on capturing the opportunities in the market by developing deep, long-term relationships with our clients. Developing these relationships requires utilising resources in a sustainable manner and deploying them to maximum impact on our profitability and returns.

What makes us different The inputs we rely on

OUR PURPOSE OUR RESOURCES

Our purpose is what sets us apart: We drive commerce and prosperity We aim to use resources in a through our unique diversity sustainable way, to achieve our long- term strategic objectives

Client focus Human capital We put our clients at the heart of Our diversity differentiates us. Achieving everything we do and we build our strategic priorities hinges on the way long-term relationships with them. we invest, manage and organise our people, the employee experience we curate and the culture we develop. How we are enhancing our resources • We are building out skills of future Robust risk strategic value including analytics, management digital and cyber capabilities – over 60% of employees with growth plans Our risk management approach in place. Certifications in skills that helps us to grow in a sustainable support new ways of working rolled manner out in 2019. • We are creating a working environment that supports resilience and creativity. Strong brand Distinct proposition We are Gambia’s premier bank By combining our local expertise established in 1894 and a member of and international network, we offer a leading international group. We our clients superior tailored have been at the forefront of financial proposition market development in Ghana.

International network Being part of an international group with presence in over 60 markets we Sustainable approach connect companies, institutions, and individuals to and in the world’s most to business dynamic regions. We promote social and economic development by contributing to Technology sustainable economic growth We possess leading technological through our core business of capabilities to enable best-in-class banking, by being a responsible customer experience, operations and company and by investing in our risk management. communities.

Standard Chartered Bank Gambia Limited 14 Annual Report 2019 STRATEGIC REPORT Corporate governance Financial statements Supplementary information 15

OUTCOMES We enableWe individuals grow and to protect their wealth. support We businesses trade, to transact, invest and alsoexpand.We help a variety financial of sector public banks, including – institutions with organisations development and clients their banking needs. Regulators and and Regulators governments to bodies governing with engage We the of functioning effective support the economy. broader the and system financial We aim to create long-term value for value long-term create aim to We stakeholders range of a broad in a sustained manner. Clients Society partners local with collaborate We and support small and medium sized and social promote to businesses development. economic Shareholders aim deliverWe to robust returns for value sustainable long-term and shareholders. our The value create we Employees provideWe learning and create to opportunities development a highly engaged and value-driven teams. Risk management Risk Debt capital markets Investment ¼ ¼ ¼ ¼ ¼ ¼ Financial Markets Financial continued

Trade financeTrade products Investments-Fixed Deposits Secured overdraft management Cash Payments and transactions ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ Transaction Banking Transaction Wealth Management Wealth on pages 92 to 93

al Banking al

Other Retail Banking products Deposits Savings Debit cards loans Personal See our client segment reviews segment client our See CLIENT SEGMENTS

¼ ¼ ¼ ¼ ¼ Retail Banking Retail Glob Products and services and Products

What we deliver we What Business model ¼ ¼ ¼ ¼ ¼ Retail Products Retail We deliver an extensive set of solutions, products and services products solutions, deliver of an set extensive We needs the our clients. of to adapted Strategic report Our strategy

Our strategy Taking the Bank to the next level

Transforming the way we deliver conduct and compliance as well as focus on the following areas for the services to meet our client’s needs ensuring we support sustainable next three years: is at the core of our strategic economic and social development priorities and critical tour success. in our market. ¼¼ Accelerate in areas where we have distinctive competitive We are executing our refreshed Our refreshed strategic priorities we advantage strategic priorities that we committed to in 2019 have announced in February 2019. We stabilised the Bank. We have ¼¼ Disrupt through digital: we are have made good progress in the learned a lot more about where we big enough to be relevant to year and we are on tract to deliver are differentiated, what our clients clients and partners yet nimble our objectives. Going forward, we want from us and what we need to enough to innovate remain committed to these do to become simpler, faster and ¼¼ Eliminate residual drags on our objectives while leading the better with sustainable growth and returns transformation of the banking returns. We realise we are capable ¼¼ Maintain discipline on cost and industry. of much more and therefore remain improve our productivity We continue to combine our local focused on delivering our strategy expertise with our international by continuing to improve our This we intend to achieve by brand, products and network to service, delivering a differentiated leveraging on the group’s refreshed differentiate ourselves from proposition to our clients and strategic priorities as follows: domestic and other international stakeholders and becoming a future competitors. ready bank. To improve our growth How we measure progress: and financial returns, we will build At the heart of our strategy is the on our purpose of driving Financial KPIs aim to meet the needs of our clients commerce and prosperity through ¼¼ Operating Income through global standards of our unique diversity by placing

Standard Chartered Bank Gambia Limited 16 Annual Report 2019 STRATEGIC REPORT Corporate governance Financial statements Supplementary information 17 Organise around customer customer around Organise journeys businesses with our Transform digital Improve returnsImprove as an internationalbank with trusted local capabilities. Continue investment in productivity ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ we will implement new business business new implement will we harness and technology models, work withnon-bank partners to acquire and serve non-affluent clients with our target profile in a manner. cost-efficient We are shapingWe our bank around the journey our of client better to align our processes and of way working with the needs our of clients and partners. This will enable driveus operational to improvement scaleto revenue growth through acquisition. client improve Conversion and while retention also delivering enhanced efficiency. and digital disrupt with Transform plan make progressWe to in digitising our Retail Banking to enhance client experience, improve efficiency, gain market share, disrupt and build a future-proof launched we of retail bank. In 2019, SMS alert, which gives our clients for phones their on notification transactions undertaken on their accounts. Optimise low returning businesses returning low Optimise continue utiliseWe our to both local and international capabilities to sharpened through returns improve participation our in both Global and BakingRetail businesses. productivityImprove Our investment and planned investment in digitisation will support productivity to continue improvement and enhance client launched we experience. In 2019, the SMS alert which provides everytransaction on notification account. client’s undertaken our on Scale the non-affluent segment in a targeted manner Meet the wealth needs the of affluentaffluent and emerging Enhance client experience with data and technology Leverage our unique footprint Maximise return frominvestment in our people ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ The rise the emerging of affluent is importantan opportunity growth for our Retail Banking business. To opportunity, this capture profitably Grow our affluentGrow business enhancing continuously By our offering been for clients, have we incomeable grow to as attract we new clients and our improve product mix in the retail Banking Segment. will increaseWe our investment in data and analytics capabilities to generate a unique understanding of our clients and their needs, and in turn our improve offerings, deliver a personalised experience and engagement. client increase Deliver our networkDeliver Our unique network is a long-term source growth of and sustainably higher continuedhave returns. We deepento our penetration among our core clients fully to realise the revenue our potential of network. Our footprint has enabled us to capture strong client we flows as corporates multinational on focus operating extensively within our as wellmarket, as investors and financial institutionsthat are seeking emerging market solutions. are We also positioned advantage take to increasing sustainable finance of opportunities market. in We want to deliver want to a client-centricWe inclusive an with environment culture that capitalises on the experience and unique diversity of our people. are building We a future-ready workforce, embedding people and leadership agile digital, amplifyskills. aim to We the impact ourof people deploying by them in markets that fittheir capabilities and careeraspirations.

Support community the Lead sustainable financingLead footprint our across Understand our responsibilities our Understand Proportion of Sustainability of Proportion Aspirations met or on track Common Equity Tier Equity ratio Common 1 among rate adoption Digital clients Banking Retail client returning low of Proportion Corporate in assets risk-weighted and Banking Institutional Operating Profit Profit before tax equity tangible on Return ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ We tackleWe inequality in our market Standard by Futuremakers through Chartered, which works with local and global partners deliver to focused community programmes and employability education, on programmes Our entrepreneurship. particularlysupport people, young girls and women. The Standard Chartered Foundation, set up in advance to charitable 2019 purposes, will be the lead delivery Futuremakers. partner for We are maintainingWe our focus on supporting economic sustainable growth, expanding renewables, in financinginvesting and it where infrastructure sustainable matters will continue We most. to facilitate the movement capital of to drive positive social and economic market. our in impact Strategic priorities and underpinning actions Purpose and People view ourWe experience and expertise in managing risk across complex markets and products as a competitive aim advantage. to We drive up standards governance, of ensure fair outcomes for clients and markets and continue partner to financial fighting in others with arecrime. further We developing Sharing Financialour Information Partnership and increasing our Correspondent Banking Academy Programme. Non-financial KPIs Non-financial Strategic report Financial Highlights

Financial Highlights for the year ended 31 December 2019

All amounts included in these financial highlights are in thousands of Gambian Dalasi, unless otherwise stated.

31-Dec-19 31-Dec-18

Profit/(loss) before provisions for credit losses 354,523 138,875

Post tax profit/(loss) 250,611 115,442 Gross loans & advances to asset ratio 5.38% 5.73% Gross loans & advances to equity ratio 53.84% 61.11% Dividend payout rate 69.30% 69.30% Earnings per share (bututs) 125.31 57.72 Dividend per share (bututs) final 50.00 40.00 Return on assets (ROA) 5.31% 2.63% Return on equity (ROE) 43.01% 22.21% Interest margin 7.53% 10.69% Cost/income ratio 19.77% 67.23% Non-performing loans ratio 0.00% 0.50% Liquid assets ratio 108% 111% Capital adequacy ratio 65.44% 38.70%

Standard Chartered Bank Gambia Limited 18 Annual Report 2019 STRATEGIC REPORT Corporate governance Financial statements Supplementary information 19 We are committed to deliver an Effective an Effective deliver to committed are We Program Crime “Financial Sustainable and Risk Fraud and AML,ABC,Sanctions covering and laws breaching for tolerance zero with FCC. to relating regulations demonstrated have we these, Through crime risk financial mitigate ability to our our with relationship good maintained and with stakeholders other and regulators transparency. Our Aspiration: “To prove that the bank bank the that prove “To Our Aspiration: Financial combating in way the leading is quality service our to providing whilst Crime, clients” driving in settles never Gambia SCB Financial Crime our Compliance within part as and responsibility our of operations communities the and bank the protect to on focused bank the 2019, In operate. we in Sustainability’ and ‘Effectiveness driving program. controls our Driving commerce & prosperity through our unique diversity unique our & prosperity through commerce Driving FCC Update Financial Controller’s Strategic report review

Financial Controller’s review An encouraging and resilient performance

We posted a positive The significant improvement in the ¼¼ Underlying operating income of bank’s profitability in 2019 was a direct GMD441.9 million was up JAWS, Improved ROE consequence of many operational and 4 per cent year-on-year. financial actions taken since 2017 and and ROTE. Balance ¼¼ Operating expenses of provides a solid base on which to GMD87.4 million was 69 per cent sheet remains robust improve shareholder value over the better compare to prior year this with strong Capital coming years. was largely on account of release Income grew at a faster rate than cost, of accruals of financial group cost and liquidity positions. profitability and return on tangible equity recharge due to a dispensation improved, capital and liquidity remained granted by the group. Summary of financial strong and balance sheet remain robust. ¼¼ Impairment of loans and performance ¼¼ Profit before tax of advances of GMD11.5 million this was compared to a recovery The bank delivered a very resilient GMD343.0 million was an reported for prior year. performance in 2019 notwithstanding improvement compared against competitor and macroeconomic prior year. challenges that impacted the bank.

31-Dec-19 31-Dec-18 Change %

GMD’000

Net interest income 277,463 327,0 8 4 -15%

Total operating income 441,892 423,829 4%

Total operating expense (87,369) (284,953) 69% Operating profit/(loss) before impairment and taxation 354,524 138,875 155%

Impairment gain on risk assets (11,512) 6,690 -272% Profits/(loss) before tax 343,011 145,566 136%

Profits/(loss) for the year 250,611 115,442 117%

¼¼ The Bank’s Capital Adequacy Ratio(CAR) of 65.4 per cent is above the statutory limit of 10 per cent. Customer loan and advances grew 11 per cent in the year and deposit 12 per cent.

Capital ratios 31-Dec-19 31-Dec-18 Total regulatory capital expressed as a percentage of total risk-weighted assets 65.44% 38.70%

Underlying income Underlying operating income of GMD441.9 million was up 4 per cent year-on-year.

¼¼ Global Banking income was down by 31 per cent from GMD172.4 million in 2018 to GMD 119.7 million in 2019. Stephen Kwawukume Financial Controller ¼¼ Retail banking income was 26 per cent higher year-on-year. From GMD161.9 million to GMD203.3 million in 2019.

Standard Chartered Bank GhanaGambia Limited Limited 20 Annual Report 2019 STRATEGIC REPORT Corporate governance Financial statements Supplementary information 21 Total 61,923 441,891 441,891 277,463 102,505 - - Central 118,905 118,905 118,905 Unallocated Retail 47,566 Financial Controller Financial businesses all over the world with the with world the over businesses all but continue we put in to measures to impact of Covid-19 pandemic onimpact Covid-19 of Stephen Kwawukume Stephen Kwawukume Bank’s businessBank’s not been an exception. We are not complacentWe about the 46,726 undoubtedly arise. undoubtedly management and pricing risk. the At performance for this year but confident ahead. years the we willwe delivery a strong performance in weeks but 2020 due slower of to global Outlook same are we time, well placed take to and will we remain prudent in our advantageany of opportunity that will economic growth coupled with the with coupled growth economic ensure that deliver we a sustainable growth and in 2020 beyond. quarter of 2019 continuedquarter in the opening 2019 of 19 June19 2020 The underlying momentum in the last the in underlying momentum The The outlook remains 2020 of challenging, 108,998 203,290 203,290 Banking 14,357 55,779 Global 49,560 119,696 119,696 Banking build the assetbook cautiously and we both the underlying and statutory profits. integral part our of long-term strategy to in the profitability and increase balance Banking remains a risk-based industry risk-based Banking a remains Building a sustainable business a anBuilding is Summary It is encouraging see to the improvement from us; to deliverfrom to us; a sustainable growth funds and realising the benefitsof our regard, are we constantly challenging the environment operate know we We in. and client our with relationship what exactly our shareholders expect progress in its operations, keeping momentum investments in key areas Competition remains strong and certain and strong remains Competition share in the natural sectoral growth in sheet momentum in the face of equity. on return higher and enhance shareholder value. In that impact positively to how on ourselves deepening through market our of cost our further reducing customers, technology. in investment continuing challenging business economic and environment. contributing to significant improvement in significantimprovement to contributing and elevated are tensions geopolitical be to continuous conditions economic challenging. The focus now is on ensuring that we The Bank continues to make remarkable make to continues Bank The better quality origination within a more a within quality origination better improved year-on-year with focus on focus with year-on-year improved its liabilities. As a consequence, the consequence, a As liabilities. its improvement across all client segments. client all across improvement 65.4 per cent65.4 per compared cent 38.7 to Revenue Net fee and commission income commission and fee Net Net interest income interest Net Net loan and advances customers to Loan impairment of GM D11.5 million was higher comparedLoan a recovery impairment to million The Bank the of GMD GM recorded of D11.5 6.7 in 2018. Bank’s customer advances to customer customer to advances customer Bank’s Segment result Underlying impairment Underlying Profit before tax Non-performing loans Balance sheet Balance focus on improving the quality and mix of Other operating income Other operating portfolio result the Non-performing loans the result recorded in 2018 both were over therecorded in 2018 Operating expense went down 69 per cent compared prior to year on account release of accruals of financial of group cost recharge due a dispensation to grantedwhich the group, by resulted in a cost compared income to per ratio 20 of cent in 2019 per67 centto in 2018. remains watchful for emerging risks in view the of persistent challenging conditions as continued geopolitical uncertainty. resolve at improving the loan base. were up 11 per cent to year-on-year were up 11 Customer deposit of GMD of deposit Customer GMD 332.8 millionGMD 332.8 reflectingthe bank’s Operating expenses Credit qualityCredit liquidation and Capital Adequacy Ratio (CAR) year-on-year. year-on-year as theyear-on-year bank continued to year-on-year. These actions resulted have year-on-year. in improved operating profit2019. in strictly monitor its loan portfolio a loan as its monitor strictly statutory per cent. limit 10 of a CAR at the end of 2019 of a CAR at the end 2019 of continue be nil to same as last year. granular risk appetite driving appetite risk granular deposits ratio was flat6.8 per at cent As a result the of many actions taken during the period, underlying profit before tax136 of per GMDmillion, 343.0 centwas higher 4,882.3 million were up 12 per million cent were up 12 4,882.3 Total segment revenue segment Total The Bank continues manage to and The credit quality the of Bank overall has The Bank is adequately capitalised with Notes to the Financial statements financial statements

BELT & ROAD 2019

The Belt and Road (B&R) Relay is a part of the Bank’s strategic intervention to position Standard Chartered as the leading B&R Bank in 45 of our markets. The Relay was led by eight staff athletes from Standard Chartered, selected from the Bank’s diverse footprint across Asia, Africa, the Middle East, Europe and the Americas. These athletes participated in running events across 44 Belt and Road markets within a 90-day period. The relay drew attention to the One Belt and One Road global trade links across Asia, Africa and Europe. The Bank has presence in 44 markets along the Belt and Road route which is also more than any other bank. This means we are uniquely positioned to demonstrate our rich heritage, deep local knowledge and unparalleled connectivity across our markets. The race came to Standard Bank Gambia on Thursday 19th April 2019. Our CEO and staff took part in the historic run alongside the 8 International and 60 local athletes. The race started at our Kairaba Avenue branch and end at the Banjul arch approximately 13km.

Standard Chartered Bank Gambia Limited 22 Annual Report 2019 STRATEGIC REPORT Supplementary information Here for good Here MONTH/YEAR END UNTIL VALID FROM ٤٥٥٤

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Celebrating those special moments? Do it with ease, Celebrating those special moments? Do it with ease, Visa Debit Card. Chartered with your Standard C Strategic report Community Engagement

Community Engagement

International Women’s Day Standard Chartered Bank Gambia on the 7th March 2019 hosted a Breakfast Meeting in Celebration of International Women’s Day at the Coco Ocean Resort & Spa focusing on gender balance and women empowerment. This was part of efforts to enhance gender equality and women empowerment thereby recognising women’s experiences, achievements and impact in advancing the cause of women in The Gambia and beyond. The event was attended by career driven Gambian Women from various works of life, as well as major players in the political, social and economic segments who promote achievements of women across The Gambia. The Gambia Economic Outlook We held a Thought Leadership Forum on The Gambia Economic Outlook focusing on The National Development Plan and The National Budget. The event was attended by stakeholders, members of the diplomatic corps, policy makers as well as major players from the financial sector. The interactive Forum drew key stakeholders and divergent representatives from most sectors in the Gambian economy that asked important questions and gave positive recommendations on the way forward. Banjul Roundabout We continued to give back to the community by refurbishing and maintaining the McCarthy Square roundabout alongside the arch roundabout in the city of Banjul. The bank also put up Christmas lights during the festive period to enhance the beauty of the city.

Standard Chartered Bank Gambia Limited 24 Annual Report 2019

STRATEGIC REPORT Corporate governance Financial statements Supplementary information 25

BREAST CANCER Breast Cancer awareness day CancerBreast awareness According to the latest WHO data published WHO data in latest the to According Breast Cancer in Gambia Deaths 2018 The age deaths. total of or 0.15% reached21 of per 100,000 is 5.57 Rate Death adjusted world. the in Gambia #178 ranks population Standard Chartered Bank Gambia in partnership Cancer with Association League, held a Breast Cancer, The Gambia (CALG) andsensitization Screening on Friday weekend The 2019. November 2nd and Saturday 1st Breast Cancer Awareness, promoted Event The and diagnosis tests women. for testing included breast mammogram, screening, biopsies and cervical cancer Over screening. 400 screened. women were staff, CEO, the graced was by This event Banjul City of and Mayor diplomats the and a mammogram 7 doctors Council. machines Senegal from brought was the by program. conduct the league to Notes to the Financial statements financial statements

Standard Chartered Bank Gambia Limited 26 Annual Report 2019 STRATEGIC REPORT Corporate governance Financial statements Supplementary information 27 capabilities and address to emerging client needs while driving innovation efficiencyand Ensure our clients take full advantage our of digital (S2B) offering which is amongst the best worldwide. Corporate the aligned closely More & Institutional Banking and Banking segments, Commercial generating synergies across deal allocation capital and origination Improved balancesheet quality, portfolio. the within Co-founded Information the Trade Network which aims be the to first multi- multi-bank, global inclusive corporate network in trade finance. The network will provide clients and participants with a standardised financing platform driving improved optionality, pricing transparency and efficiency Underlying profit before taxationof GMD fee 73m and commission income primarily driven higher by income and lower credit impairment Underlying of income million primarilyGMD120 driven by Financial and income Interest Markets income which partially offset margin compression in Cash Management. ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ Performance highlights Performance Progress Partner with clients and strategically selected third parties expand to Deliver sustainable growth for clients agendas, understanding their by providing trusted advice and data-driven analytical insights, and strengthening our leadership in flow business by returns high-quality Generate driving balance sheet velocity, quality funding and improving controls risk maintaining ¼ ¼ ¼ ¼ ¼ ¼ Strategic objectives Segment overview overview Segment Corporate & Institutional Banking supports clients with their transaction banking, needs. borrowing and financial markets finance, corporate Our clients include large corporations, governments, banks and investors operating or investing in Gambia. Our strong and deep local presence across these markets enables connect us to our clients multilaterally investors, to suppliers, buyers and sellers and enable them move capital, to manage risk, invest create to wealth, and provide them with bespoke financing solutions. providers – and offering our clients’ employees banking services through Retail Banking. are we Finally, committed sustainable to finance, delivering on our ambitionsto a services and have that products financial support for increase funding and environment. and communities our on impact positive

2% 2018

7,6 6 0 m 6,505m

Assanatou Barry-Njie Assanatou Country Head of Global Banking

%

1 2019 Return on tangible equity (RoTE) 2019 GMD 2018 Risk-weighted assets Risk-weighted GMD GMD 98m GMD 2018 2019 Profit before taxation before Profit 73m GMD At a glance

Global Banking Strategic report Retail Banking

Retail Banking

Key numbers for 2019 Segment overview Profit before taxation Retail Banking serves over thirty-seven thousand individuals and small businesses, with a focus on affluent and emerging affluent. Our clients desire deep relationships that help them build and protect their wealth and we provide -GMD 106.9m services spanning across deposits, payments and financing products to meet 2018: -GMD 82m their needs. We aim to deliver convenient and easy banking with a human touch Total assets for clients in our chosen segments. Retail Banking represents approximately 76% of customer deposits and 46% of GMD 45m the bank’s operating income. We are closely integrated with the bank’s other 2018: GMD 8m client segments; for example, offering employee banking services to Global Total deposit Banking clients, and Retail Banking provides a high-quality liquidity source for the bank. We aim to improve productivity and client experience through GMD 3,732m automating our platforms, driving cost efficiencies and simplifying processes. 2018: GMD 3,380m Strategic Priorities: Our priorities for the segment are:

IMPROVING CLIENT EXPERIENCE ¼¼ Accelerate business momentum ¼¼ Build an increasingly more efficient and growth. We will be innovative in business. Efficiency means We remain committed to driving providing the right solutions and optimising our investments and improvements in client experience and do this by listening to clients back them with relationship ensuring our channels of feedback and using it to refine our deepening in our managed distribution are sized right. segments to drive business growth. services and processes. We have ¼¼ Build the right culture around risk, provided prompt resolution to client ¼¼ Embed the right key tenets of the conduct and compliance. We will complaints, in line with our standard of 48 hours, and see them as an bank’s purpose and valued continue to build a business that opportunity to better understand behaviours. Our belief is that, when assures stakeholders of the safety and serve. We launched the SMS we change our culture; our clients of the incomes the business alert service which provides experience with the bank becomes generates. notification on every transaction a positively memorable one. undertaken on our client’s account Progress against strategic and we are enhancing ¼¼ Improve our clients’ experience priorities our technology platforms to further with best-in-class products and ¼¼ Strong income growth, exceeding improve client experience in the service, responding to the changing previous year performance by 25%, future. needs and habits of clients in our market. ¼¼ Liabilities grew by 10% against previous year performance. ¼¼ Personal Banking segment contributed 81% of income and grew by 28% against previous year. ¼¼ Business Banking contributed 19% to income, growing by 13% against previous year. ¼¼ Enhanced our Employee Banking proposition with the provision of unsecured personal loans. ¼¼ Renovated our two largest branches, Banjul and Serrekunda, with a modern and digital ambiance for improved client experience.

Akweley Laryea Head, Retail Banking

Standard Chartered Bank Gambia Limited 28 Annual Report 2019 STRATEGIC REPORT Corporate governance Financial statements Supplementary information 29 Outlook for 2020 willWe continue focus to on growth in assets diversify to Banking Employee our through sheet balance our core a deepening remains relationship Client proposition. pillar and will we further enhance our platforms provide to client self-service channels for greater access and convenience in carrying out banking transactions. The business will also continue drive to for greater efficiency alongside income growth increase to profitability. Deposits grew to GMD3,732m, which Deposits is a growth 10% of GMD3,732m, grew to against Growth previous in year. deposits was supported a continued by focus on our face market to initiative. launched We our employee banking personal loans, ending the year with assets GMD45m. of Operating expenses increased from previous year by GMD313.84m. to 14% While the year ended with an operating loss of improvementthis was a 5% overprevious GMD110.45m, performance. year 2019 saw a strong growth in operating2019 income. Income higher GMD203.29mof than was 25% previous year performance. ¼ ¼ ¼ ¼ ¼ ¼ ¼ ¼ Performance Highlights Performance Stakeholders Strategic report and responsibilities

Stakeholders and responsibilities Committed to our promise to be here for good

As an international bank with 12 ATMs which accepts VISA cards and 4 branches in prime locations such as Banjul, Serrekunda, Kairaba Avenue, Basse and an agency in Senegambia, stakeholder engagement is central to how we understand local and global perspectives and trends that inform our approach to doing business.

Engaging stakeholders Constructive dialogue with stakeholders is central to delivering sustainable and responsible banking. Regular engagement builds trust with governments, regulators, investors and civil society, and enables us to understand and respond to the long-term challenges facing our market. This is necessary if we are to deliver our purpose to drive commerce and prosperity in our market. During 2019, we increased our dialogue and engagement with stakeholders including,clients,regulators and investors on sustainability. We continued to track short- and long-term issues, assessing them based on business impact and level of stakeholder concern. Stakeholder feedback is communicated internally to senior management through the relevant governance forums. Clients Regulators and Government

How we create value How we create value policymakers at a national level to share insights and technical expertise on key We enable individuals to grow and We engage with relevant authorities to policy issues. This engagement supports protect their wealth. We help businesses play our part in supporting the effective the development of best practice and the to trade, transact, invest and expand. We functioning of the financial system and the broader economy. adoption of consistent approaches in the also help a variety of financial institutions, financial sector. We comply with all including banks, public sector and How we serve and engage relevant transparency requirements and development organisations, with their engage with government and regulators banking needs. We actively engage with governments, in many ways, including through ongoing regulators and policymakers to play our dialogue, submission of responses to How we serve and engage part in supporting the effective formal consultations and by joining and Clients are at the heart of everything we functioning of the financial system and participating in industry seminars. do as a bank. By building and fostering the broader economy. We are committed In 2019 we held a Thought Leadership long-term relationships with our clients, to complying with all legislation, rules and Forum on The Gambia Economic we can serve them better, deepen our other regulatory requirements applicable Outlook focusing on The National relationships, uphold our reputation and to our businesses and operations. Our Development Plan and The National attract new customers to grow our compliance with legal and regulatory Budget. The event was attended by business. During 2019, we continued to frameworks ensures that the Bank meets stakeholders, members of the diplomatic capture feedback via the Net promoter its obligations. In turn, this supports the corps, policy makers as well as major score(NPS) survey. resilience and effective functioning of the Bank and the broader financial system players from the financial sector. The We enable individuals to grow and and economy. On a day-to-day basis, interactive Forum drew key stakeholders protect their wealth. We help businesses our Compliance function is responsible and divergent representatives from most to trade, transact, invest and expand. We for identifying changes to financial sectors in the Gambian economy that also help a variety of financial institutions services regulation, ensuring that we asked important questions and gave – including banks, public sector and comply with all requirements, and help to positive recommendations on the way development organisations – with their manage relationships. We actively forward. banking needs. Our strategy is engage with government, regulators and dependent on our ability to develop deep, long-term relationships with our clients. We aim to deliver fair outcomes for clients by designing products and delivering Suppliers services that meet their needs and are appropriate to their circumstances. How we create value rights and environmental performance. Where issues arise, we aim to deal with Our suppliers must recommit to the We work with local and global suppliers complaints in a fast, fair and efficient way. charter annually, and regular to ensure they can provide the right We have procedures and processes in engagement to monitor performance is goods and services for our business, place to handle client complaints in each built into our procurement practices and efficiently and sustainably. business segment. In 2019 we engaged standards. We engage locally and more directly with clients to obtain their globally to create value through the How we serve and engage feedback on our products and services. supply chain for both our business and We recognise, through our ongoing Engagement is guided by our Supplier our suppliers. engagement with clients, the need to Charter, which sets out what we expect further simplify our processes and to of suppliers on issues such as ethics, provide more convenient channels of antibribery and anti-corruption, human service.

Standard Chartered Bank Gambia Limited 30 Annual Report 2019 STRATEGIC REPORT Corporate governance Financial statements Supplementary information 31 2019 14.62

28 2018

24 2017 Our eNPS has declined in 2019 Increase engagement across the bank by diverse talent. are building We a virtual supported platform, marketplace talent artificialby intelligence, that enables employees match their to skills and aspirationswith short-term experiences. are alsoWe rolling out a personalised tailored provides that learning platform recommendations and access to learning external and resources. internal This should help employees manage their careers. In addition, have we delivered a series targeted of leadership training programmes People to Leaders and talents key develop to role readiness and build leadership capabilities for the future. These efforts are having a positive impact on developing our pipeline internal of invested we talents. In 2019, significantly in the developmentof our people in training programmes delivered locally in Gambia the by West Africa People Capability team. Several employees attended various Nigeria, Ghana, in programmes Cameroon, South UAE, Africa, UK and USA. eNPS measures the number of promoters (who would recommend the Group as a great place to work) compared with detractors on a scale from This is reflected +100. to -100 in the percentage calculation. change Aim: creating a betterworking environment for our employees that should translate into an improved experience. client Analysis: following an increased in 2018. wanted from their leaders in My Voice. opportunities for gave results survey The feedback and improvement. As part of our refreshed People are we Strategy, implementing several initiatives to increasing including improve, learning experiencesopportunities for for all employees. a In October 2019, Learning Carnival was held create to opportunities and to awareness offerings. available the on employees KPI: Employee engagement Employee Net Promoter Score (eNPS) (eNPS) Score

% %

60 40 Management Team ry omen Men W objectives and future roles. Our goal in is for2020 90 per cent people of to have a growth plan in place. are investingWe in support tools to this people global new Our aspiration. easier it makes platform management for employees define to their objectives, receive feedback from peers and plan their career growth. increase want to We access to our opportunities for development Count CMT Listening to employees to Listening Listening employees to helps us identify, and work close to gaps between their expectations and their experiences. My survey engagement annual our Voice, has played a role at each stage in our culture had we a transformation. In 2019, strong participation96% of with rate 55%. of score engagement employee Our intent stay Our score to at 77%. at (eNPS) Score Promoter Net Employee 14.62. During 2 first-time leaders the year, leader people new Group’s attended to LeadX programme development leadership capabilities. better develop informed was content programme The whatby our employees told us they Their interestsTheir our Group conductedIn 2019, research understandto our Employee Value Proposition (EVP) or the value that employees feel they gain frombeing part ourof organisation. The research also employees potential what illustrated consider important their to work. Our EVP has been input a key our to refreshed People The Strategy. strategy will be enabler a key in delivering our business strategy while also creating a experience. employee differentiated

% %

52 48 R GENDE -

A

ployees omen Employees ble Men W a ll Em T A Developing future skills in a diverse workforce The world work of continues change to equip wantrapidly. to We employees with the skills they need prosper to in ambiguous increasingly this environment. This starts with an aspiration for every employee have a to personalised growth plan, created in partnership with their people leader and based on their performance, career How we serve and engage a fostering and employees engaging By positive experience for them at Standard Chartered, can we better serve our clients and deliver our purpose drive to our prosperity through and commerce inclusive an Building diversity. unique harness unique our to enables us culture make innovation, unlock diversity to business our deliver decisions, better live ourstrategy, valued behaviours, and good’. for embody ‘Here the Group hasSince taken steps 2016, antoward inclusive, innovative and performance-based that culture conduct. and sustainability emphasises When lived consistently, our valued behaviours (Never settle, Do the right deliver should together) Better and thing, culture. desired our proactivelyWe assess and manage example, for risks; people-related as culture, and capability, organisation, part our of Group risk management framework. We believe great employee experience experience employee great believe We drives great client experience. want We all our people pursue to their ambitions, deliver with purpose and have a rewardingcareer enabled great by leaders. people Stakeholders Strategic report and responsibilities

Stakeholders and responsibilities continued

Employees continued

resilience and creativity, so they can We continue to build on the resources CASE STUDY thrive at work and in their personal lives. (mental, physical, social and financial) to Providing working conditions that are help our employees manage their broad and inclusive will help us to reap individual wellbeing needs. We have Inclusive the benefits of our diverse and talented wellbeing champions in place. We workforce. We have over the years initiated a bottom up programme in leadership conducted market data surveys that 2019 collaborating with Walk for Health enable us to benchmark in terms of Gambia, encouraging healthy eating, pay, continually improve our benefits, improved canteen facilities, and Over 80 per cent of our people support our employees’ lifestyle, quarterly employee ‘Happy Hour’ leaders have now attended an wellbeing and development. sessions. Inclusive Leadership Programme. This build an understanding of how to create an inclusive culture FUTURE SKILLS and create value by unlocking the diversity of thought in teams. This has been further supported by the Global learning week launch of an activity-based e-learning ‘When we’re all In support of our ambition to develop demonstrations of learning tools, included’ in 2019. future skills as part of our refreshed Quiz competition and videos, articles People Strategy, we held a global and podcast were consumed. The learning week in October titled week was a catalyst to encourage We will only prosper as an organisation ‘Invest in Yourself’. About 110 people to think about the future of if our employees and teams prosper participants took part in more than work, develop new skills and make too. We want to create a working 10 events that included panels, learning an everyday habit. environment that supports employee external speakers and

Creating an inclusive culture that dates (International Women’s Day in Externally, we have engaged with leverages our diversity March; World Day for Cultural Diversity clients in our efforts to drive the pace of Following the launch of our Diversity and Dialogue in May; International change and inclusion across the and Inclusion (D&I) strategy in 2018, we Men’s Day and International Day for industry. We have been recognised by have continued to build the foundations Persons with Disability in November) to UNICEF as an institution with family and raise awareness of D&I. It is our raise awareness, enable dialogue, friendly policies; UNDP Gender Seal strong belief that a culture of inclusivity highlight role models, disrupt traditional Pilot; Special Olympics for supporting is the key to harnessing our unique norms and break stereotypes. Our local Special Needs athletes; Walk4Health diversity to unlock innovation and campaign supported by our D&I council Gambia; and Banjul City Council. was able to achieve 70% per cent of create shareholder value. Our Inclusive Our People Leaders have come our 2019 D&I action plan ranging from Leadership Programme, completed by together to sharpen their awareness of panel events with clients and more than 80 per cent of people inequality, develop inclusive leadership community representatives. leaders, cultivates skills and behaviours strategies and hone skills to make a to help mitigate unconscious bias and Our inclusion efforts have earned us lasting impact. build a culture of inclusion. This has recognition in The Gambia and actions We are proud of the progress that we further been supported through the have led to improvements in the have made to date but recognise there launch of our e-learning, ‘When we’re outcomes we measure including female is more work to do. Our inclusion efforts all included’’ for all employees. representation in senior roles, we have and actions have led to improvements maintained above 40% consistently We recognise four international D&I in the outcomes we measure. f ro m 2017.

Standard Chartered Bank Gambia Limited 32 Annual Report 2019 Strategic report CORPORATE GOVERNANCE CORPORATE GOVERNANCE

34 Corporate information 36 Board of Directors 38 Management Team 42 Corporate governance 45 Directors’ report Financial statements “Good Corporate Governance creates a transparent set of rules and controls in which shareholders, directors, and officers have aligned incentives. It is meant to be a starting point for constructive dialogue informationSupplementary with board leadership” Corporate governance Corporate information

Corporate information

Registered name Standard Chartered Bank Gambia Limited (SCBG) Registered Office 8 Ecowas Avenue Banjul The Gambia.

Board of Directors Mr. Alpha Amadou Barry Chairman Mr. Olukorede Adenowo CEO Dr. Omodele R. N. Jones INED Mr. Idrissa Kamara NED Mr. Lamin Manjang NED Mr. Omar F. M’Bai Company Secretary

Senior Management Mr. Olukorede Adenowo Chief Executive Officer (until 30/04/2020) Mr. Stephen Kwawukume Financial Controller (Appointed 01/10/2019) Mrs. Akweley Laryea Head, Retail Banking Mr. Baboucarr Badjan Head, Human Resources Mr. Karalang Jaiteh Chief Information Officer Mr. Mustapha John Head, Corporate Affairs, Brand & Marketing Mr. Omar F. M’Bai Head, Legal & Company Secretary Mrs. Assanatou Barry Njie Head, Global Banking Mrs. Nenneh Ndiaye Head, Internal Audit Mrs. Ida Fye-Touray Head, Conduct, Financial Crime and Compliance

Auditors Solicitor

DT Associates Gambia Ltd Ida Drameh and Associates 1 Paradise Beach Place 13A Marina Parade Bertil Harding Highway Banjul Kololi, Banjul The Gambia The Gambia

Board Audit and Risk Committee Company Secretary

Dr. Omodele R. N. Jones Omar F. M’Bai Mr. Idrissa Kamara 8 Ecowas Avenue Mr. Lamin Manjang Banjul The Gambia.

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Terms and Conditions apply Corporate governance Board of Directors

Board of Directors

Appointed: July 2016 other services across degree in Maritime Experience: Mr. Alpha Nigeria, Ghana, Gambia Studies from the A. Barry was appointed and Cameroon. Mr. Barry University of Wales, to The Gambia Board as was based in the Deloitte College of Cardiff. He Chairman on 1st July, Headquarters for the completed the London 2016 replacing Mr. West Africa Cluster in Business School Momodou B.A. Lagos Nigeria which was Corporate Finance Senghore, who had involved in building up the Modular Programme in served as The Gambia Corporate Finance London, England in 2010. Chairman from 2000 until Business Unit. In Mr. Barry has been his retirement on 30th December 2013 he set involved in several June, 2016. up his boutique advisory professional services Mr. Alpha A. Barry practice based in The delivery to clients and as Chairman Mr. Barry was the Gambia mainly executing a result has acquired Country Managing opportunities in Nigeria. partner of the Gambia extensive financial practice of Deloitte which Mr. Barry is a Fellow of advisory and practice provides Corporate the Chartered management expertise Finance, Transaction and Association of Certified with an incredible Valuation Services and Accountants and also network of contacts possesses a Masters across West Africa.

Appointed: April 2017 and most recently Nigeria founding staff of SCB Experience: Olukorede in advising them on Nigeria and has held Adenowo (K.O) is accessing international other positions in currently Chief Executive capital markets and Standard Chartered Bank Officer for Standard ultimately improving the Group in the last 20 Chartered Bank (SCB) banks visibility in Public years. He has worked in The Gambia with dual Sector for business Societe Generale Bank responsibility for SCBs success and growth in Nigeria and Deloitte business in Senegal. He an increasingly stringent Nigeria, where he has also been a Non regulatory environment. qualified as a Chartered Executive Director of He has served as Accountant in 1990. SCB Sierra Leone from Managing Director, An Economist turned 2014 to date. Origination and Client Chartered Accountant; Olukorede Adenowo K.O has a total of 30 Corporates for Standard he was appointed Fellow Chief Executive Officer years post-university Chartered Bank, West of the Institute of experience in Banking, and Central Africa, Chartered Institute Finance and Consulting. Deputy Managing Accountants of Nigeria in Director of Standard 2000. In his penultimate role as Chartered Bank Africa Co-Head Financial He is an alumnus of Cameroon and Director INSEAD and Said Institutions and Public in Wholesale Bank in Sector business for SCB, Business School of Standard Chartered Bank Oxford University where K.O provided strong Nigeria. leadership in building and he had management managing key strategic FI He was appointed the training in Leadership relationships across West first Regional Head of and holds an MBA from Africa. He worked closely Global Corporates for the Lagos Business with several Banks and Standard Chartered School. Governments across the Africa where he led the He is married to region i.e. Cameroon, Africa Multinational Olajumoke and both have Gabon, Senegal, Ghana, business. He is a two children.

Standard Chartered Bank Gambia Limited 36 Annual Report 2019 Strategic report

Appointed: October experience with as CEO in Sierra Leone, 2018 Standard Chartered Botswana, Uganda and Experience: Lamin was Bank across Africa and Oman. Lamin was the appointed to the Board the Middle East. He had CEO of SCB Kenya and on 18th October 2018 as served SCB Gambia in East Africa until his CORPORATE GOVERNANCE an Non-Executive various capacities as recent appointment in Director and a member Branch Manager, Head 2019 as the CEO of of the Board Audit & Risk of Consumer Banking Nigeria and West Africa. Committee. Lamin has and Head of Finance Mr. Lamin Manjang over 17 years banking before being appointed Managing Director

Appointed: June 2015 and is the CEO of FJP for the private & not for Financial Management & profit sectors and for Experience: Dr. Jones Financial statements was appointed to the Consultant Firm. He Public Sector Board on 25th June, 2015 offers 27 years of beneficiaries. as an Independent post-tertiary audit, Committee: Chairman Non-Executive Director. turnaround & strategy of the Board Audit & Dr. Jones is a Chartered experience in the United Risk. Accountant by profession Kingdom and West Africa. This includes work Dr. Omodele R.N. Jones Chief Executive Officer, FJP Development & Management Supplementary informationSupplementary

Appointed: August as CEO for Standard programme. Before 2015 Chartered Sierra Leone, moving to SLCB, Idrissa Experience: Mr. Kamara Idrissa spent almost two spent almost 10 years is the CEO of Standard (2) years as Chief with the Bank, first as Chartered Bank Sierra Executive Officer of Business Finance Leone. He was Sierra Leone Commercial Analyst, in 2003. He also appointed to The Bank (SLCB), the largest served as Chief Finance Gambia Board as a Bank in the country Officer, Company Non-Executive Director where he led a Secretary and in January successful 2013 appointed as Chief Mr. Idrissa A. Kamara on 17th August, 2015. transformation Operating Officer. CEO/Managing Director Prior to his appointment Sierra Leone

Appointed: January role at EcoBank Gambia Conference on Trade 2010 Limited and in Private and Development Experience: Omar Legal Practice. Mr. M’Bai (UNCTAD) as an adviser joined Standard is a member of the on the Legal aspects of Chartered Gambia on 1st Gambia Bar Association, e-Commerce. January 2010 as Chief a Legal adviser to the Legal and Company Institute of Bankers of Secretary. He was The Gambia and certified previously in the same by the United Nations Omar F M’Bai Chief Legal Counsel & Company Secretary

37 Corporate governance Management Team

Management Team

Appointed: April 2017 Sector for West Africa. In Non-Executive Director of Experience: Olukorede his most recent role as the Board of Standard Adenowo joined Standard Regional Head of Financial Chartered Bank Sierra Chartered Bank in 1999. Institutions and Public Leone and serves on the He has worked in various Sector for West and Board of a number of roles including Regional Central Africa, he provided charities. He is a Fellow of Head of Global Corporate strong leadership in the Institute of Chartered Africa, Deputy Head of building and managing Accountants of Nigeria, Origination and Client key strategic FI has an MBA from the Coverage Nigeria, Head of relationships across West Lagos Business School Origination and Client Africa for business (IESE) and graduated from Coverage, West Africa 4 success and growth in an the University of Ife, Ile-Ife Olukorede Adenowo and more lately Regional increasingly stringent Nigeria. CEO / Managing Director Head of Financial regulatory environment. Institutions and Public K.O Adenowo is a

Stephen joined Standard examinations/Reviews. Accountant -ACCA, UK; Chartered Bank Ghana He had also worked as a Institute of Chartered in August 2005. He had Performance Manager Accountants-ICAG, worked as Finance and until recently was Ghana; Chartered Operational Risk officer, supporting with Business Institute of Securities and Local Regulatory Finance partnering for Insurance, UK. Reporting Manager, Ghana. where he was instrumental in SCB Stephen holds a Ghana’s migration from Bachelor of Science, Manual submissions to Administration Online submissions and (Accounting option) from Stephen Kwawukume managed most External the University of Ghana. Financial Controller Audits and Ghana He is also a member of Central Bank onsite the Association of Chartered Certified

Appointed: January Association, a Legal 2010 adviser to the Institute of Experience: Omar Bankers of The Gambia joined Standard and certified by the Chartered Gambia on United Nations 1st January 2010 as Conference on Trade Chief Legal and and Development Company Secretary. He (UNCTAD) as an adviser was previously in the on the Legal aspects of same role at EcoBank e-Commerce. Gambia Limited and in Omar F M’Bai Private Legal Practice. Chief Legal Counsel & Mr. M’Bai is a member of Company Secretary the Gambia Bar

Standard Chartered Bank Gambia Limited 38 Annual Report 2019 Strategic report

Appointed: June 2018 Prior to joining the Bank, Institute of Personnel and Experience: Baboucarr Baboucarr worked for Development (CIPD) UK was appointed Head, the National Water and and holds a Post Human Resources, Electricity Company Graduate Degree in Limited, Gambia for over Human Resources

Gambia on 1st June CORPORATE GOVERNANCE 2018. Prior to this role, 6 years as Senior Human Management and a Baboucarr was the Resources Officer and Bachelor of Arts in Human Resources the Specialist Group Business Administration Service Delivery International, United from the University of Specialist, Standard Kingdom for over a Wales, United Kingdom. Chartered Bank, period of 3 years. He has Baboucarr is currently Gambia. a proven track record of Chair to the Gambia over 10 years in Human Baboucarr Badjan Baboucarr joined the Bankers Association’s Resources. Human Resources Head of Human Resources Bank in February 2016 Baboucarr is a Chartered Managers’ Sub-

as Performance Rewards Financial statements and Benefits Specialist. Member of the Chartered Committee”.

Appointed: May 2011 Experience: Nenneh joined Standard Chartered Bank Gambia Limited in May 2011 as Country Head of Audit. Prior to joining the bank,

she was an Audit informationSupplementary Manager at Deloitte and Touche where she worked for 6.5 years. Nenneh M. Ndiaye Nenneh is a Chartered Head of Audit Certified Accountant (ACCA).

Appointed: January making great and Marketing. 2018 achievements with the Mustapha has a Masters Experience: Mustapha Agency Service, he degree in International joined Standard became Head, Business Management Chartered Bank in Growth and (Entrepreneurship & January 2018. Prior to Development, managing Innovation) from The that, he worked at all Alternative Business University of Exeter, Reliance Financial Channels; Agency United Kingdom and a Services as Head of Service, Internet Service BA (Hons) in Banking Agency Banking where and Mobile Financial with Economics & Law he led operations to Service. He then moved from London on to become Head of Mustapha John successfully implement Metropolitan University, their Agency Financial Retail Finance and United Kingdom. Head of Corporate Affairs/ Corporate Affairs whilst Brand & Marketing Service business, a first in The Gambia. After also overseeing Brand

39 Corporate governance Management Team

Management Team continued

Appointed: January 2007 where she now Relationship Management. 2017 manages our Financial She holds a Certificate in Experience: Assanatou Institutions Clients for Banking and Finance, joined Standard Chartered Gambia and Senegal. coupled with several Bank in January 1996, Assanatou has worked in certifications on Standard and worked in several other Standard Chartered Chartered Bank learning units of Retail Banking offices in Kenya and Cote road map. She is now the before moving to D’voire on short term Head of Global Banking. Wholesale Banking in assignments and has gained vast experience in Assanatou Barry-Njie Country Head of Global Banking

Appointed: May 2013 Operations, responsible management positions in Experience: Karalang for Technology support, the Technology and joined Standard Chartered Banking Operations and Operations department. Bank Gambia Ltd in 1992. proactive management of He is currently the Chief relationships with our Operations Officer and diverse range of Country Head of stakeholders. Since 2002, Technology and he has held several senior Karalang Jaiteh Chief Operations Officer

Appointed: January career with Standard Diversity & Inclusion 2018 Chartered Bank in 2000 Council, Ghana. She has Experience: Akweley as a Management a wealth of experience in was appointed Head, Trainee. She started in People Development, Retail Banking in The Technology and Retail Banking, Process Gambia in January 2018. Operations and since Re-engineering, Risk and Prior to her appointment 2004 has held various Service Delivery. Akweley she was Head, Client roles in Retail Banking in holds an MBA from the Experience, Process and Ghana and West Africa in Ghana Institute of Governance for Ghana, Learning and Management and Public Gambia and Sierra Development, Service Administration and a Leone. Akweley has 20 Delivery, Governance Bachelors’ degree in Akweley Laryea years of banking and Risk Management. Economics and She was also at one time Computer Science from Head, Retail Banking experience. She commenced her banking the Chairperson of the the University of Ghana.

Appointed: January this appointment, Ida Gambia. She attained 2017 worked for Central Bank Master of Business Experience: Ida Fye- of The Gambia as a bank Administration (MBA) in Touray rejoined Standard regulator for seventeen International Banking and Chartered Bank Gambia years. She had also Finance from University Limited in January 2018 served as the focal of Birmingham in the as Country Head, person for Anti-money United Kingdom. Conduct, Financial Crime Laundering and and Compliance. Prior to Terrorism Finance at the Ida Fye Touray Central Bank of The Head, Conduct, Financial Crime and Compliance

Standard Chartered Bank Gambia Limited 40 Annual Report 2019 Information Technology and Strategic report Operations 2019 Highlights

Technology and operations updates, including security country technology team is department continues to invest updates from them. As a result, working with the group project heavily in our technology we have completed a project that team to enhance the existing infrastructure to support business was initiated by Group to Avaya system. Once the upgrade growth. During the year, we have upgrade all PCs from windows7 is completed, we will roll it out to

delivered the following key projects to Windows10, including critical all the branches including the CORPORATE GOVERNANCE among others. dependency business Head office. applications. This has improved ¼¼ Regulatory reporting To improve customer experience, efficiency and speed. enhancement for automation we have worked with our of Cash Transaction ¼¼ Backup link for the branches: technology team and other Reporting (CTR) and Foreign As part of the bank’s initiative to stakeholders and implemented a Wire Transaction Reporting mitigate single point of failure for Global Clearing Gateway (GCG) (FWTR) - as per the directive branches running on single links, project. This platform has received from Financial Intelligent we have implemented a backup connected our payment systems Unit (FIU), we have automated link solution which provides an directly to the Central Bank Clearing

our weekly reporting process alternate connection in case of a House. It has also automated the file Financial statements and also to include local failure in the primary link. This transfer protocol by eliminating transactions (account to has improved efficiency and unnecessary layers in order to account), and RTGS transactions reliability. instantly send customer payments to local banks. for CTR /FWTR. This ensures ¼¼ ATM footprint increased the bank submits accurate data across the bank: we have This has significantly improved the to the Regulator (Financial worked with our technology team turnaround time of file transfers from intelligent unit) in a timely manner. to add two additional ATMs in the 30 to 40 minutes to just less than 15 ¼¼ Automated EBBS Cheque network. This has expanded our second. Rejection: we have worked with ATM footprint and improved

Group technology and customer experience. informationSupplementary compliance team to enhance our ¼¼ Branch Optimization Project: Core Banking system for cheque As part of efforts to optimize two rejections. With this upgrade, branches in the Gambia. We are cheque rejection process has pleased to report that we have been automated to straight worked with stakeholders to through process thereby refurbish two branches with state increasing the efficiency in terms of the art facilities. of error rate and speed of payments for local transaction. ¼¼ Avaya Rollout Country wide: In our efforts to upgrade our ¼¼ Windows10 migration: Since voice infrastructure to a world the support for Windows 7 has class standard, and to be ended, Microsoft announced we compliant with sanctions will no longer receive software blocking requirement, the

41 Corporate governance Corporate governance

Corporate governance

Good Governance is one of the core values of Standard Chartered Bank Gambia Limited (SCBG). SCBG believes that good corporate governance contributes to the long-term success of a company, creating trust and engagement between the company and its stakeholders. Exemplary governance standards and ethics are core to our strategic intent. SCBG confirms its commitment to the implementation of effective corporate governance principles in its business operations, and are of the opinion that SCBG has in all material respects, complied with the requirements of the CBG guideline during the 2019 financial year. The Board of Directors of SCBG has the overall responsibility for ensuring that the highest standards of corporate governance are maintained and adhered to by the Bank. In doing this, the structural framework outlined below has been put in place for the execution of the Bank’s corporate governance strategy: 1 Board of Directors; 2 Board Committees; 3 Management Committees. The Board comprises 1 Executive Director, 2 independent Non-Executive Directors and 2 Non-Executive Directors headed by the Chairman of the Board. There is the Board Audit and Risk Committee and Internal Audit Department through which the Board of Directors performs its oversight functions. Broad policy guidelines are set, and monitored through extensive consultations and deliberations on various reports and presentations by respective stakeholders, to ensure the proper management and direction of the Bank. In addition to the Board Audit & Risk Committee and Internal Audit Department, there are Management Committees to ensure strong, sound and effective corporate governance at management level. The Board

The Board presently comprises 5 members; 1 of whom, is the MD/CEO, is an Executive Director and 4 Non- Executive Directors, 2 of whom are Independent Non-Executive Directors. The Non-Executive Directors have the requisite integrity, skills and experience to bring independent judgment to bear on Board deliberations and discussions. The roles of Chairman and Chief Executive Officer are separate. The Board’s primary responsibility is to increase shareholders value. The Board is accountable to shareholders and is responsible for the management of the relationships with its various stakeholders. In fulfilling its primary responsibility, the Board is aware of the importance of achieving a balance between conformance to governance principles and economic performance. The Board meets quarterly and additional meetings are convened as and when required. The Board met on four (4) occasions during the 2019 financial year and has a formal schedule of matters specifically reserved for its decision. These matters include, but are not limited to, determining the strategy of the Bank, overseeing the Bank’s compliance with statutory and regulatory obligations and issues relating to the Bank’s capital. The Board is also responsible for the Bank’s structure and areas of operation, financial reporting, ensuring there is an effective system of internal controls and risk management and appointments to the Board. The Board has the authority to delegate matters to Directors, Board Committee and Management Committees. The schedule of attendance by the directors at the Board meetings held in 2019 is as follows: No. Directors Board meetings Q1 Q2 Q3 Q4

1 Mr. Alpha Amadou Barry Y Y Y Y 2 Mr. Adenowo Olukorede (Chief Executive Officer) Y Y Y Y 3 Dr. Omodele R. N. Jones Y Y Y Y 4 Mr. Idrissa Kamara Y Y Y Y 5 Mr. Lamin Manjang Y Y Y Y

Standard Chartered Bank Gambia Limited 42 Annual Report 2019 Key Strategic report Y Yes Y* Via proxy N No R Retired N/A Not Applicable Board Audit and Risk Committee

The Board Audit and Risk Committee presently comprises two (2) Non-Executive Directors. The primary role of the Committee is to ensure the integrity of the audit process and financial reporting and to maintain a sound risk CORPORATE GOVERNANCE management and internal control system, as stipulated in the Companies and Banking Acts of The Gambia. The responsibilities of the Committee include: ¼¼ To regularly review and report the effectiveness of the bank’s system of internal controls and risk management processes to the Board of the Bank. ¼¼ To review the Bank’s annual statement on internal controls and its compliance prior to consideration by the Board; ¼¼ Oversee independence and objectivity of the external auditor; ¼¼ To review quarterly audit reports from the Head, Internal Audit and Investigations on the arrangements established by management for ensuring adherence to internal risk management, control, and governance processes: Financial statements ¼¼ To consider the quality, application and acceptability of the accounting policies and practices, the adequacy of accounting records and financial and governance reporting disclosures and changes thereto; ¼¼ To consider the report on or, any findings and other matters arising from the external auditor’s interim and final audits; and ¼¼ To be responsible for the review of the integrity of the Bank’s financial reporting system. Four (4) meetings were held by the Board Audit and Risk Committee during the 2019 financial year with the schedule of attendance by the directors at the meetings of the Committee as follows: No. Directors Board meetings Supplementary informationSupplementary Q1 Q2 Q3 Q4 1 Dr. Omodele R. N. Jones Y Y Y Y 2 Mr. Idrissa Kamara Y Y Y Y 3 Mr. Lamin Manjang Y Y Y Y

Management Committees

These are Committees comprising of senior management of the Bank. The Committees are also risk driven, as they are basically set up to identify, analyze, synthesize and make recommendations on risks arising from day to day activities of the Bank. They also ensure that risk limits as contained in the Board and Regulatory policies are implemented and complied with at all times. They provide inputs for the respective Board Committees and also ensure that recommendations of the Board Committees are effectively and efficiently implemented. They meet as frequently as the risk issues occur to immediately take actions and decisions within the confines of their powers. The main management Committees in the Bank includes the Country Executive Committee, Assets and Liability Committee, Executive Risk Committee, Credit Issues Committee and the Pensions Committee.

43 Corporate governance Corporate governance

Corporate governance continued

The Country Executive Committee:

Standard Chartered Bank Gambia Limited 44 Annual Report 2019 Directors’ Report Strategic report For the year ended 31st December 2019

The Directors present their annual report on the affairs of Standard Chartered Bank Gambia Limited together with the audited financial statements for the year ended 31st December 2019. (a) Footprint Standard Chartered Bank is a market leading financial services brand in The Gambia and has operated for 126 years, producing sustained and increased investment in The Gambia. It is currently ranked among the top 4 Banks in CORPORATE GOVERNANCE the banking sector and its strong focus on developing deep relationships with clients and customers has driven a consistent growth in recent years. It is committed to building a sustainable business over the long term in The Gambia and is trusted worldwide for upholding high standards of corporate governance, social responsibility, environmental protection and employee diversity. (b) Principal activity and business review The principal activity of the Bank is the provision of banking and other financial services to corporate and individual customers. Such services include granting of loans and advances and financial market activities. (c) The Bank’s operating results for the year Financial statements The Bank posted positive results for the year 2019 amidst an intensely competitive domestic market and low Treasury bill rates. With about 60% of revenue being derived from Treasury bill investments, the drop in rates over the last few years has hugely impacted revenue performance. Given the Bank’s resilience and strong strategy however, these challenges were overcome to bring a positive end to the year. With new loans booked by Retail banking since the launched of the Personal loans and key deals were closed within the Global Banking segment. The Bank also took measures to bring down operating costs in 2019 and this has shown positively in the overall performance. There was a 69% year on year drop in total operating expenses coming mainly from general administrative expenses which reduced by 294% year on year, mainly due to group recharge dispensation that was received and booked during the year. Cost saving initiatives implemented also positively impacted cost.

All amounts in thousands of Gambian Dalasi unless otherwise stated informationSupplementary

31 Dec 2019 31 Dec 2018

Gross earnings 513,389 483,217 Profit/(loss) before tax 343,011 145,566 Tax (92,400) (30,124) Profit/(loss) for the year 250,611 115,442 Appropriation: Transfer to statutory reserves 62,653 28,860 Transfer to retained earnings and other reserves 187,958 86,582 250,611 115,442 Return on equity (pre-tax) 52% 28% Return on equity (post-tax) 39% 22% (d) Dividend The Board of Directors recommends to the shareholders the payment of dividends for the financial year ended 31st December 2019 of 50butus per share (2018:40 butus per share). (e) Directors None of the directors had an indirect shareholding in the Bank as at 31st December 2019. In accordance with the Memorandum and Articles of Association, Non-Executive Directors are appointed on a two year renewable contract basis. The Directors do not retire by rotation. (f) Directors’ interests in contracts For the purpose of section 279 of the Companies Act 2013, no director had a direct or indirect interest in contracts or proposed contracts with the Bank during the year.

45 Financial statements Directors’ Report

Directors’ Report continued For the year ended 31 December 2019

(g) Property, Plant and Equipment (PPE) Information relating to changes in PPE is given in note 14 to the financial statements. In the directors’ opinion, the market value of the Bank’s PPE is not less than the value shown in the financial statements. (h) Shareholding analysis Share range No. of shareholders %age of shareholders No. of holdings %age of holdings Domestic 642 99.8 50,296,877 25.15 Foreign shareholders 1 0.2 149,703,123 74.85 643 100 200,000,000 100

(i) Substantial interest in shares According to the register of members as at 31st December 2019, Standard Chartered Holdings (Africa) BV held 74.85% (foreign shareholder) of the issued shares. Domestic shareholders together held 25.15%, of which Social Security and Housing Finance Corporation held 16.48 and rest held 8.67%. No other domestic shareholder held more than 5%.

31 Dec 2019 31 Dec 2018

Beneficiary GMD GMD Health related - 2,172,000 Other Donations 6,217,024 - 6,217,024 2,172,000 (k) Post balance sheet events There were no events after the reporting date which could have a material effect on the state of affairs of the Bank as at 31st December 2019 and the profit for the year ended on that date that have not been adequately provided for or disclosed. The directors are carrying out an assessment of the impact of COVID-19 Pandemic on the performance and operations of the Bank and do believe that the outcome might impact the financial year 2020 assets, liabiliities, revenue and cost. l) Client complaints Excellent Service and Client Satisfaction remains a key focus area for Standard Chartered Bank Gambia Limited. We remain committed to enhancing our client’s experience by responding promptly to client feedback and complaints The following channels are available for clients to engage us on any feedback or complaints:

¼¼ Our branch network ¼¼ Global Enquiry Management System (GEMS) ¼¼ Letters/Telephone calls ¼¼ Email to our dedicated client feedback mailbox ¼¼ Client feedback surveys Complaints receipt, resolution, analysis and feedback are handled by the Client Experience team (CPEG) and client services group ( CSG) for Retail and Global banking respectively. In line with our promise of delivering friendly, fast and accurate service, our staff ensure that all client complaints are handled promptly and professionally and that clients are called and kept updated throughout the investigation and resolution of their complaint. Post resolution, we engage clients for feedback on how their complaints have been handled so as to be able to continuously improve. Complaints are also reviewed regularly by senior management and detailed root cause analysis done to ensure the necessary improvements are made in our processes to prevent recurrence. (m) Human resources Employment of disabled persons The Bank operates a non-discriminatory policy on recruitment. Applications for employment by disabled persons are

Standard Chartered Bank Gambia Limited 46 Annual Report 2019 always fully considered, bearing in mind the respective aptitudes and abilities of the applicants concerned. In the Strategic report event of members of staff becoming disabled, every effort is made to ensure that their employment with the Bank continues and that appropriate training is arranged. It is the policy of the Bank that training, career development and promotion of disabled persons should, as far as possible, be identical with those of other employees. The Bank had no disabled persons in its employment during the year ended 31st December 2019. Health, safety and welfare at work The health, safety, and security of our people is the highest priority and an essential part of the Bank’s duty of care. The Bank has a low risk appetite from any health, safety, and security risk which could harm any person, property, or premise. In addition, it is mandatory to develop and maintain Health & Safety Legal compliance registers. Annual Health and Safety (H&S) inspection is always completed and we have in place an H&S management system that considers both physical and mental health and safety. The H&S Management System includes an Action Corporate governance Plan to manage risks and implement management arrangements. This also involves H&S related communications and staff briefings and broadcasts, trainings, emergency response drills and risk reporting and mitigation actions. In furtherance of this, the Bank has a life insurance policy and an accident policy to adequately insure and protect its employees. The services of clinics are retained in several locations to facilitate employees’ access to health care. Diversity in employment Our diversity provides us with a unique competitive advantage and we strive to encourage our employees to learn about different cultures and how to develop cross-cultural working skills. We are also proactive in driving gender sensitive engagement. As at 31 December 2019, our total workforce had a 50% female engagement level while our

senior management team had 40% female representation. On the Board of Directors, the ratio of male to female was FINANCIAL STATEMENTS 100%:0%. Find below; the gender analysis of our employees as at year end. Male Female Total Male Female Number Number Number Percentage Percentage Employees 76 75 151 50.3% 49.7% Gender analysis of Board and top management as follows: Board 6 0 6 100% 0% Senior Management 6 4 10 60% 40% Total 12 4 16 75% 25% Supplementary informationSupplementary The bank will continue to maintain and support women leadership programs. (n) Employee involvement and training The Bank is committed to keeping employees as fully informed as possible regarding its performance and progress. Opinions and suggestions of staff members are sought and considered not only on matters affecting them as employees but also on the general business of the Bank. Each employee has a documented training and career development program. To this end, short and long term training programs are tailored to suit the requirements of both employees and the Bank. Sound management and professional expertise are considered to be the Bank’s major assets, and investment in their future development continues to be top priority. (o) Auditors The Audit Committee has the responsibility delegated from the Board of Directors for making recommendations on the appointment, reappointment, removal and remuneration of the external auditor. Messrs DT Associates has been appointed auditor of the Bank commencing with the financial statements for the year ended 31 December 2019.

The approved auditor fee for the 2019 audit is GMD1.1million (2018: GMD750,000) BY ORDER OF THE BOARD

Mr. Omar F M’Bai’ Sign…………………………. Company Secretary 8 Ecowas Avenue Banjul The Gambia 19th June, 2020 47 Financial statements Directors’ Report

Statement of Directors’ Responsibilities For the year ended 31 December 2019

The Directors of Standard Chartered Bank Gambia Limited are responsible for the preparation of the financial statements that give a true and fair view of the financial position of the Bank as at 31st December 2019, and the results of its operations, cash flows and changes in equity for the year ended, in compliance with International Financial Reporting Standards (“IFRS”) and in the manner required by the Companies Act 2013 and the Banking Act 2009. In preparing the financial statements, the Directors are responsible for:

¼¼ Properly selecting and applying accounting policies; ¼¼ Presenting information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information; ¼¼ Providing additional disclosures when compliance with the specific requirements in IFRS are insufficient to enable users to understand the impact of particular transactions, other events and conditions on the Bank’s ¼¼ financial position and financial performance; and ¼¼ Making an assessment of the Bank’s ability to continue as a going concern. The Directors are responsible for:

¼¼ Designing, implementing and maintaining an effective and sound system of internal controls throughout the Bank; ¼¼ Maintaining adequate accounting records that are sufficient to show and explain the Bank’s transactions and disclose with reasonable accuracy at any time the financial position of the Bank, and which enable them to ensure that the financial statements of the Bank comply with IFRS; ¼¼ Maintaining statutory accounting records in compliance with the legislation of The Gambia and IFRS; ¼¼ Taking steps that are reasonably available to them to safeguard the assets of the Bank: and ¼¼ Preventing and detecting fraud and other irregularities. Going Concern: The Directors have made an assessment of the Bank’s ability to continue as a going concern and have no reason to believe the Bank will not remain a going concern in the year ahead.

Standard Chartered Bank Gambia Limited 48 Annual Report 2019 Strategic report Corporate governance

“Our aim is to protect FINANCIAL STATEMENTS FINANCIAL STATEMENTS STATEMENTS shareholder value through 50 Independent Auditor’s report sustainable growth” 53 Income Statement 54 Statement of other comprehensive income 55 Statement of financial position 56 Statement of changes in equity 57 Statement of cash flows Supplementary informationSupplementary 58 Notes to the financial statements

49 Independent Auditor’s Financial statements Report

Independent Auditor’s Report To the shareholders of Standard Chartered Bank (Gambia) Limited

Standard Chartered Bank Gambia Limited 50 Annual Report 2019 Strategic report Corporate governance FINANCIAL STATEMENTS Supplementary informationSupplementary

51 NotesIndependent to the Auditor’s Financial statements Reportfinancial statements

Independent Auditor’s Report continued To the shareholders of Standard Chartered Bank (Gambia) Limited

Standard Chartered Bank Gambia Limited 52 Annual Report 2019 Income Statement Strategic report for the year ended 31 December 2019

All amounts in thousands of Gambian Dalasi unless otherwise stated Notes 31-Dec-2019 31-Dec-2018 Interest and similar income 2 333,140 379,157 Interest and similar expense 3 (55,677) (52,073) Net interest income 277,463 327,0 8 4 Corporate governance

Fee and commission income 4a 118,325 46,166 Fee and commission expense 4b (15,819) (8,835) Net fee and commission income 102,506 37,3 31

Net trading income 5c 61,923 57,8 9 4 Other income 5d - 1,520 Net foreign exchange income 61,923 59,414 Total operating income 441,892 423,829 FINANCIAL STATEMENTS

Personnel cost 6a (202,122) (152,987) Premises cost 6b (36,712) (41,380) Depreciation 6c (9,744) ( 7,470) General administrative expense 6d (120,402) (83,116) Other reversals of provisions 6e 281,611 - Total operating expense 6 (87,369) (284,953) Operating profit/(loss) before impairment and taxation 354,524 138,875 Supplementary informationSupplementary Impairment gain/(loss) on risk assets 11a (11,512) 6,690 Profit/(loss) before tax 343,011 145,566

Income tax expense 7a (92,400) (30,124) Profit/(loss) for the year 250,611 115,442

Basic earning/(loss) per ordinary share 25 1.25 0.58 Diluted earning/(loss) per ordinary share 25 1.25 0.58

The accompanying notes are an integral part of these financial statements

53 NotesStatement to the of other Financial statements comprehensivefinancial statements income

Statement of other comprehensive income for the year ended 31 December 2019

All amounts in thousands of Gambian Dalasi unless otherwise stated 31-Dec-2019 31-Dec-2018

Profit/(loss) for the year 250,611 115,442

Items that may be reclassified subsequently to income statement: - Change in fair value of financial assets - 429

- Deferred tax charge on financial assets - (3,958)

Other comprehensive income for the year - (3,529) Total comprehensive income for the year 250,611 111,915 The accompanying notes are an integral part of these financial statements.

Standard Chartered Bank Gambia Limited 54 Annual Report 2019 Statement of Financial Position Strategic report for the year ended 31 December 2019

All amounts in thousands of Gambian Dalasi unless otherwise stated Note 31-Dec-2019 31-Dec-2018

Assets:

Cash and balances with Central Bank 8 1,419,499 1,441,082 Corporate governance Financial asset - non-pledged trading assets 9 3,365,802 2,744,322 Due from other banks 10 937,672 822,320 Loans and advances to customers 11 332,781 298,949 Other assets 12 282,973 167,6 61 Property, plant and equipment 14 108,250 69,060 Deferred tax assets 18 8,597 - Total assets 6,455,573 5,543,393

Liabilities: FINANCIAL STATEMENTS Customer deposits 15 4,882,302 4,377, 26 5 Due to other banks 16 304,958 48,011 Income tax payable 7b 70,379 67,73 9 Deferred tax liabilities 18 - 22,388 Other liabilities 17 552,466 508,124 Total liabilities 5,810,106 5,023,528

Equity: Ordinary share capital 19 200,000 200,000 Supplementary informationSupplementary Retained earnings 157,731 88,858 Statutory reserves 187,420 124,767 Other reserves: - Credit risk reserve 46,738 54,775 - Non-pledged trading assets equity reserve 53,579 51,466 Total equity 645,467 519,866 Total equity and liabilities 6,455,573 5,543,393 These financial statements were approved by the Board of Directors and authorised for issue on 19th day of June, 2020 and signed on its behalf by:

Chairman Managing Director

The accompanying notes are an integral part of these financial statements.

55 Statement of Financial statements changes in equity

Statement of changes in equity for the year ended 31 December 2019

All amounts in thousands of Gambian Dalasi unless otherwise stated Share Credit risk Statutory FVOCI Retained Total 31 December 2018 capital reserve reserve reserve earnings equity

Balance as at 1 January 2018 200,000 48,428 95,907 47,079 12,415 403,829 Total comprehensive income, net of income tax Profit for the year - - - - 115,442 115,442 Total other comprehensive income - - - - 115,442 115,442 Total comprehensive income for the year - - - - 115,442 115,442

Transfer from income surplus to reserves and transactions with owners, recorded directly in equity Transfer to credit risk reserve - 6,347 - - (6,347) - Transfer to statutory reserve - - 28,860 - (28,860) - Reclassification of deferred tax credit on non-pledged trading assets - - - 3,792 (3,792) - Deferred tax credit on non-pledged trading assets - - - 166 - 166 Staff loan on FVOCI - - - 429 - 429 Total transfers and transactions with owners - 6,347 28,860 4,387 (38,999) 595 Balance as at 31 December 2018 200,000 54,775 124,767 51,466 88,858 519,866 The accompanying notes are an integral part of these financial statements.

All amounts in thousands of Gambian Dalasi unless otherwise stated Share Credit risk Statutory FVOCI Retained Total 31 December 2019 capital reserve reserve reserve earnings equity

Balance as at 31 December 2018 200,000 54,775 124,767 51,466 88,858 519,866 Retained earnings adjustments (note19a) - - - - (45,009) (45,009) Balance as at 1 January 2019 200,000 54,775 124,767 51,466 43,849 474,856 Total comprehensive income, net of income tax Profit for the year - - - - 250,611 250,611 Total comprehensive income for the year - - - - 250,611 250,611

Transfer from income surplus to reserves and transactions with owners, recorded directly in equity Transfer to/from credit risk reserve - (8,037) - - 8,037 - Transfer to statutory reserve - - 62,653 - (62,653) - Net gain/(loss) on non-pledged trading assets 2,113 (2,113) - Dividend paid to equity holders - - - - (80,000) - Total transfers and transactions with owners - (8,037) 62,653 2,113 (136,729) (80,000) Balance as at 31 December 2019 200,000 46,738 187,420 53,579 157,731 645,467

Standard Chartered Bank Gambia Limited 56 Annual Report 2019 Statement of cash flows Strategic report for the year ended 31 December 2019

All amounts in thousands of Gambian Dalasi unless otherwise stated Note 31-Dec-2019 31-Dec-2018 Cash flows from operating activities Profit/(loss) before tax 343,011 145,566 Adjustments for: Corporate governance Depreciation 6c 9,744 7,470 Impairment on financial assets 11a 11,512 (6,690) Profit on sale of fixed assets - (1,520) Change in fair value - (429) Unrealised foreign exchange expense - 4,429 Provision for operational losses - 334 Unrealised derivative income on interbranch payables - (196) Provisions and other financial liabilities (198) 9,762 Fixed asssets written off - 150 FINANCIAL STATEMENTS Unrealised other income - 74 Opening balance difference - SOCIE (45,009) Opening balance difference - Tax liability account (42,500) Net interest income (277,463) (327,084) (903) (168,135)

Increase/(decrease) in loans and advances to customers (33,832) 141,673 Decrease/(increase) in other assets (121,821) (28,791) Increase in restricted reserves with Central Bank (77,210) (663,792) Supplementary informationSupplementary Decrease in deferred tax liabilities (30,985) - (Decrease)/Increase in deposits from banks 256,947 (25,367) Increase in deposits from customers 505,037 561,284 (Decrease)/Increase in other liabilities 44,342 (108,788) 541,576 (291,916)

Interest received 333,140 379,157 Interest paid (55,677) (52,073) Income tax paid (52,065) (4,617) Net cash generated from operating activities 766,974 30,551

Cash flows from investing activities Sale/(purchase) of investment securities (621,480) 48,614 Proceed from sale of fixed assets - 1,520 Purchase of property and equipment 14 (48,934) (6,331) Net cash from/(used in) investing activities (670,414) 43,803

Cash flows from financing activities Dividend paid (80,000) - Net cash used in financing activities (80,000) -

Net increase in cash and cash equivalents 16,560 74,354 Cash and cash equivalents at 1 January 1,599,610 1,525,256 Cash and cash equivalents at 31 December 26 1,616,170 1,599,610

The accompanying notes are an integral part of these financial statements. 57 Notes to the Financial statements financial statements

Notes to the financial statements for the year ended 31 December 2019

1.0 Reporting Entity Standard Chartered Bank Gambia Limited is incorporated in The Gambia as a limited liability company offering banking services. Its registered office is situated at 8 Ecowas Avenue, Banjul. The financial statements, which were approved by the Board on 19th June, 2020, comprise the separate financial statements of the Bank for the year ended 31 December 2019. The principal activity of the Bank is the provision of banking and other financial services to corporate and individual customers. Such services include granting of loans and advances and financial market activities. 1.1 Basis of Preparation 1.1.1 Statement of Compliance The financial statements of the Bank have been prepared and approved by the Directors in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB); the International Financial Reporting Interpretations Committee (IFRIC) and the Companies Act 2013 and Banking Act 2009. These financial statements comprise the statement of comprehensive income, the statement of financial position, the statement of changes in equity, the cash flow statement and the accompanying notes. The accounting policies set out have been consistently applied in preparing the financial statements for the year ended 31 December 2019, and the comparative information presented in these financial statements for the year ended 31 December 2018. The disclosure of the nature and extent of risk under IFRS 9 “financial Instruments: Disclosures” have been made in relevant section of the notes to the financial statements. The Bank’s management has made an assessment of its ability to continue as a going concern and is satisfied that it has the resources to continue in business for the foreseeable future. Furthermore, management is not aware of any material uncertainties that may cast significant doubt upon the Bank’s ability to continue as a going concern. Therefore, the financial statements continue to be prepared on the going concern basis. 1.1.2 Functional and presentation currency The financial statements are presented in Gambian Dalasi (GMD), which is the Bank’s functional currency and all values are rounded to the nearest thousand Dalasi except when otherwise indicated. Some of the balances are out by 1 due to this rounding. 1.1.3 Basis of measurement The financial statements have been prepared on a historical cost basis except for the following:

¼¼ Financial instruments are measured at fair value through other comprehensive income. ¼¼ Derivative financial instruments were measured at fair value. ¼¼ Non-derivative financial instruments at fair value through profit or loss are measured at fair value. ¼¼ hare based payment at fair value. ¼¼ Loans and receivables are measured at amortised cost. ¼¼ Assets and Liabilities held to maturity are measured at amortised cost. 1.1.4 Use accounting judgements, estimates and assumptions The preparation of financial statements in conformity with the IFRS requires the use of certain critical estimates. It also requires management to exercise its judgments in the process of applying the Bank’s accounting policies. The following estimates and judgments are considered key significant judgments in the preparation of these financial statements.

¼¼ ·Loan loss provisioning ¼¼ Fair value of financial instruments ¼¼ Share based payments ¼¼ ·Ta xation The accounting policies set out below have been applied consistently to the periods presented in these financial statements.

Standard Chartered Bank Gambia Limited 58 Annual Report 2019 1.2 Significant AccountingPo licies Strategic report 1.2.1 Changes in Accounting Policies - New and amended standards adopted by the Bank The Bank initially applied IFRS 16 from 1January 2019. A number of other new standards are also effective from 1 January 2019, but they do not have a material effect on the Bank’s financial statements. The Bank applied IFRS 16 using the modified retrospective approach under which the cumulative effect of initial application is recognised in retained earnings at 1 January 2019. Accordingly, the comparative information presented for 2018 is not restated –i.e. it is presented as previously reported under IAS 17 and related interpretations. The details of the changes in accounting policies are disclosed below. Additionally, the disclosure requirements in IFRS 16 have not generally been applied to comparative information.

a. Definition of a lease Corporate governance Previously, the Bank determined at contract inception whether an arrangement was contained under a lease under IFRIC 4 Determining whether an Arrangement contains a Lease. The Bank now assesses whether a contract is or contains a lease based on the definition of a lease as explained in Note 1.2.1b On transition to IFRS 16, the Bank applied the definition of a lease under IFRS 16 to all contracts. b. As a leasee As a lessee, the Bank leases many assets including branches, ATMs, and certain equipment. The Bank previously classified as operating leases based on its assessment of whether the lease transferred significantly all the risks and rewards incidental to ownership of the underlying asset to the Bank. Under IFRS 16, the Bank recognises right-of-use assets and lease liabilities for most of these leases –i.e. these leases are on-balance sheet. FINANCIAL STATEMENTS At commencement or on modification of a contract that contains a lease component, the Bank allocates the consideration in the contract to each lease component on the basis of its relative stand-alone price. On transition, lease liabilities were measured at the present value of the remaining lease payments, discounted at the Bank’s incremental borrowing rate as at 1 January 2019 (See Note 1.2.1 (C)(i)). Right-of-use assets are measured at an amount equal to the lease liability, adjusted by the amount of any prepaid or accrued lease payments relating to that lease recognised in the statement of financial position immediately before the date of initial application. The Bank has tested its right-of-use assets for impairment on the date of transition and has concluded that The Bank used a number of practical expedients when applying IFRS 16 to leases previously classified as operating leases under IAS 17. In particular, the Bank Supplementary informationSupplementary ¼¼ did not record a lease liability or right-of-use asset for leases with a remaining term of less than 12 months as at 1 January 2019 ¼¼ excluded initial direct costs from the measurement of right-of-use assets at 1 January 2019; and ¼¼ Used hindsight in determining the lease term c. Impact on financial statements i. Impact on transition On transition to IFRS 16, the Bank recognised additional right-of-use assets and additional lease liabilities. The impact on transition is summarised below.

All amounts in thousands of Gambian Dalasi unless otherwise stated 1 January 2019 Lease liabilities 14,040 Prepayment of items now treated under IFRS 16 2,817 Right-of-use assets presented in property, plant and equipment 16,857 When measuring lease liabilities for leases that were classified as operating leases, the Bank discounted lease payments using its incremental borrowing rate at 1 January 2019. The rate applied is 9.56 percent for the leases.

All amounts in thousands of Gambian Dalasi unless otherwise stated 1 January 2019 Operating lease commitments at 31 December 2018 as disclosed under IAS 17 in the Bank’s financial statements 22,903 Discounted using the incremental borrowing rate at 1 January 2019 9.56% Recognition exemption for leases with less than 12 months of lease term at transition - Lease liabilities recognised at 1 January 2019 14,040

59 Notes to the Financial statements financial statements

Notes to the financial statements continued for the year ended 31 December 2019

1.2.2 Standards, interpretations issued but not yet adopted A number of new standards and amendments to standards and interpretations are effective for annual periods beginning after 1 January 2019 and have not been applied in preparing these financial statements. Those which may be relevant to the Bank are set out below. The Bank does not plan to early adopt these Standards. a. Amendments to References to Conceptual Framework in IFRS Standards The IASB revised the Conceptual Framework because certain important issues were not covered and certain guidance was unclear or out of date. The revised Conceptual Framework, issued by the IASB in March 2018, includes:

¼¼ A new chapter on measurement; ¼¼ Guidance on reporting financial performance; ¼¼ Improved definitions of an asset and a liability, and guidance supporting these definitions; and ¼¼ Clarifications in important areas, such as the roles of stewardship, prudence and measurement uncertainty in financial reporting. The IASB also updated references to the Conceptual Framework in IFRS Standards by issuing Amendments to References to the Conceptual Framework in IFRS Standards. This was done to support transition to the revised Conceptual Framework for companies that develop accounting policies using the Conceptual Framework when no IFRS Standard applies to a particular transaction. It is not expected that this will impact the Bank significantly. b. Definition of Material (Amendments to IAS 1 and IAS 8) The IASB refined its definition of material to make it easier to understand. It is now aligned across IFRS Standards and the Conceptual Framework. The changes in Definition of Material (Amendments to IAS 1 and IAS 8) all relate to a revised definition of ‘material’ which is quoted below from the final amendments “Information is material if omitting, misstating or obscuring it could reasonably be expected to influence decisions that the primary users of general purpose financial statements make on the basis of those financial statements, which provide financial information about a specific reporting entity.” The Board has also removed the definition of material omissions or misstatements from IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors. The amendments are effective from 1 January 2020 but may be applied earlier. However, the Board does not expect significant change – the refinements are not intended to alter the concept of materiality. It is not expected that this will impact the Bank significantly. Interest Rate Benchmark Reform (Amendments to IFRS 9, IAS 39 and IFRS 7) Amendments to IFRS 9, IAS 39 and IFRS 7 have now been issued to address uncertainties related to the The amendments address issues affecting financial reporting in the period leading up to IBOR reform, are The amendments are effective from 1 January 2020. Early application is permitted. It is not expected that this will impact the Bank significantly. 1.2.3 Interest Income and Expense a. Effective interest rate a. Effective interest rate Interest income and expense are recognised in the statement of comprehensive income using the effective interest method. The ‘effective interest rate’ is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial instrument to:

¼¼ the gross carrying amount of the financial asset; or ¼¼ the amortised cost of the financial liability. When calculating the effective interest rate for financial instruments other than purchased or originated credit- impaired assets, the bank estimates future cash flows considering all contractual terms of the financial instrument, but not expected credit loss (ECL). For purchased or originated credit-impaired financial assets, a credit-adjusted effective interest rate is calculated using estimated future cash flows including ECL.

Standard Chartered Bank Gambia Limited 60 Annual Report 2019 The calculation of the effective interest rate includes transaction costs and fees and points paid or received that Strategic report are an integral part of the effective interest rate. Transaction costs included incremental costs that are directly attributable to the acquisition or issue of a financial asset or financial liability. b. Amortised cost and gross carrying amount The ‘amortised cost’ of a financial asset or financial liability is the amount at which the financial asset or financial liability is measured on initial recognition minus the principal repayments, plus or minus the cumulative amortisation using the effective interest method of any difference between that initial amount and the maturity amount and, for financial assets, adjusted for any expected credit loss allowance. The ‘gross carrying amount of a financial asset’ is the amortised cost of a financial asset before adjusting for any

c. Calculation of interest income and expense Corporate governance The effective interest rate of a financial asset or financial liability is calculated on initial recognition of a financial asset or a financial liability. In calculating interest income and expense, the effective interest rate is applied to the gross carrying amount of the asset (when the asset is not credit-impaired) or to the amortised cost of the liability. The effective interest rate is revised as a result of periodic re-estimation of cash flows of floating rate instruments to reflect movements in market rates of interest. However, for financial assets that have become credit-impaired subsequent to initial recognition, interest income is calculated by applying the effective interest rate to the amortised cost of the financial asset. If the asset is no longer credit-impaired, then the calculation of interest income reverts to the gross basis. For financial assets that were credit-impaired on initial recognition, interest income is calculated by applying the credit-adjusted effective interest rate to the amortised cost of the asset. The calculation of interest income does FINANCIAL STATEMENTS not revert to a gross basis, even if the credit risk of the asset improves. d. Presentation Interest income calculated using the effective interest method presented in the statement of comprehensive income includes:

¼¼ interest on financial assets and financial liabilities measured at amortised cost; ¼¼ interest on debt instruments measured at FVOCI; Interest expense presented in the statement of comprehensive income comprise financial liabilities measured at amortised cost; Supplementary informationSupplementary Interest income and expense on all trading assets and liabilities are considered to be incidental to the Bank’s trading operations and are presented together with all other changes in the fair value of trading assets and liabilities in net trading income. Interest income and expense on other financial assets and financial liabilities at FVTPL are presented in net income from other financial instruments at FVTPL. 1.2.4 Fees and Commissions Fees and commission income and expenses that are an integral part of the effective interest rate on financial instruments are included in the measurement of the effective interest rate. Other fees and commission income, including account servicing fees, investment management fees, sales commission, placement and arrangement fees and syndication fees - is recognised as the related services are performed. If a loan commitment is not expected to result in the draw-down of a loan, then the related loan commitment fee is recognised on a straight-line basis over the commitment period. Other fees and commission expense relates mainly to transaction and service fees, which are expensed as the services are received. Net trading income Net trading income comprises gains less losses related to trading assets and liabilities, and includes all fair value changes, interest, dividends and foreign exchange differences. Net income from other financial instruments at FVTPL Net income from other financial instruments at FVTPL relates to non-trading derivatives held for risk management purposes that do not form part of qualifying hedging relationships, financial assets and financial liabilities designated as at FVTPL and also, non-trading assets mandatorily measured at FVTPL. The line item includes fair value changes, interest, dividends and foreign exchange differences.

61 Notes to the Financial statements financial statements

Notes to the financial statements continued for the year ended 31 December 2019

1.2.5 Foreign currency a. Functional and presentation currency The financial statements are presented in Gambian Dalasi which is the Bank’s functional currency. Except where necessary and indicated, the financial information presented were rounded to the nearest thousand. b. Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains or losses resulting from settlements of such transactions and from the translation at year end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement. Non-monetary assets and liabilities are translated at historical exchange rates if held at historical cost, or year-end exchange rates if held at fair value, and the resulting foreign exchange gains and losses are recognised in either the income statement or shareholder’s equity as appropriate. 1.2.6 Cash and cash equivalents For the purposes of the cash flow statement, cash and cash equivalents comprise cash on demand, overnight balances with Central Bank (unless restricted) and highly liquid financial assets with less than three months’ maturity from the date of acquisition including amounts due from other banks and short-term government securities. 1.2.7 Financial Instruments a. Initial recognition and measurement The Bank initially recognises loans and advances, deposits, debt securities issued on the date on which they are originated. All other financial instruments (including regular-way purchases and sales of financial assets) are recognised on the trade date, which is the date on which the Bank becomes a party to the contractual provisions of the instrument. A financial asset or financial liability is measured initially at fair value plus transaction costs that are directly attributable to its acquisition or issue, for an item not at FVTP. b. Classification and subsequent measurement Financial assets and liabilities - Policy before 1 January 2018 The Bank classifies its financial assets in the following categories: financial assets held at fair value through profit or loss; loans and receivables and available-for-sale financial assets. Financial liabilities other than financial guarantees and loan commitments are classified as either held at fair value through profit or loss or at amortised cost. Management determines the categorisation of its financial assets and liabilities at initial recognition. i. Financial assets at fair value through profit or loss – held-for-trading Held-for-trading assets comprise investment in securities that the Bank acquires principally for the purpose of selling or repurchasing in the near term or holds as part of a portfolio that is managed together for short term profit or position taking. Held-for-trading assets are initially recognised and subsequently measured at fair value in the statement of financial position, with transaction costs recognised in profit or loss. All changes in the fair value are recognised as part of net trading income in profit or loss. Trading assets may be reclassified out of the fair value through profit or loss - i.e. trading category if they are no longer held for purpose of being sold or repurchased in the near term and the following: If the financial asset would have met the definition of loans and receivables (if the financial asset had not been required to be classified as held for trading on initial recognition), then it may be reclassified if the Bank has the intention and ability to hold the financial asset for the foreseeable future or until maturity. If the financial asset would not have met the definition of loans and receivables then it may be reclassified out of the trading category only in rare circumstances. ii. Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and which are not classified as Available for Sale or Fair Value Through Profit or Loss. They arise when the Bank provides money, goods or services directly to a debtor with no intention of trading the receivable. Loans and receivables are subsequently valued at amortised cost using the effective interest rate method. It is expected that substantially all of the initial investment will be recovered other than because of credit deterioration.

Standard Chartered Bank Gambia Limited 62 Annual Report 2019 iii. Available-for-sale Strategic report Available-for-sale investments are those intended to be held for an indefinite period of time, which may be sold in response to needs for liquidity or changes in interest rates, exchange rates or equity prices. Financial assets and liabilities On initial recognition, a financial asset is classified and measured at: amortised cost, Fair value through other comprehensive income (FVOCI) or Fair value through profit or loss (FVTPL). A financial asset is measured at amortised cost if it meets both of the following conditions and is not designated as at FVTPL:

¼¼ the asset is held within a business model whose objective is to hold assets to collect contractual cash flows; and Corporate governance ¼¼ the contractual terms of the financial asset give rise on specified dates to cash flows that are SPPI. ¼¼ A debt instrument is measured at FVOCI only if it meets both of the following conditions and is not designated as at FVTPL: ¼¼ the asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets; and the contractual terms of the financial asset give rise on specified dates to cash flows that are SPPI. All other financial assets are classified as measured at FVTPL. In addition, on initial recognition, the Bank may irrevocably designate a financial asset that otherwise meets the requirements to be measured at amortised cost or at FVOCI as FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise. FINANCIAL STATEMENTS Business model assessment The Bank makes an assessment of the objective of a business model in which an asset is held at a portfolio level because this best reflects the way the business is managed and information is provided to management. The information considered includes: i. The stated policies and objectives for the portfolio and the operation of those policies in practice. In particular, whether management’s strategy focuses on earning contractual interest revenue, maintaining a particular interest rate profile, matching the duration of the financial assets to the duration of the liabilities that are funding those assets or realising cash flows through the sale of the assets; ii. How the performance of the portfolio is evaluated and reported to the Bank’s management; iii. The risks that affect the performance of the business model (and the financial assets held within that informationSupplementary business model) and how those risks are managed; iv. How managers of the business are compensated e.g. whether compensation is based on the fair value of the assets managed or the contractual cash flows collected; v. The frequency, volume and timing of sales in prior periods, the reasons for such sales and its expectations about future sales activity. However, information about sales activity is not considered in isolation, but as part of an overall assessment of how the Bank’s stated objective for managing the financial assets is achieved and how cash flows are realised. vi. Financial assets that are held for trading or managed and whose performance is evaluated on a fair value basis are measured at FVTPL because they are neither held to collect contractual cash flows nor held both to collect contractual cash flows and to sell financial assets. Assessment of whether contractual cash flows are solely payments of principal and interest on principal For the purposes of this assessment, ‘principal’ is defined as the fair value of the financial asset on initial recognition. ‘Interest’ is defined as consideration for the time value of money and for the credit risk associated with the principal amount outstanding during a particular period of time and for other basic lending risks and costs (e.g. liquidity risk and administrative costs), as well as profit margin. In assessing whether the contractual cash flows are solely payments of principal and interest, the Bank considers the contractual terms of the instrument. This includes assessing whether the financial asset contains a contractual term that could change the timing or amount of contractual cash flows such that it would not meet this condition. In making the assessment, the Bank considers: i. contingent events that would change the amount and timing of cash flows; ii. leverage features; iii. prepayment and extension terms; iv. terms that limit the Bank’s claim to cash flows from specified assets (e.g. non-recourse asset arrangements); v. Features that modify consideration of the time value of money – e.g. periodical reset of interest rates.

63 Notes to the Financial statements financial statements

Notes to the financial statements continued for the year ended 31 December 2019

Amortised cost Financial assets at amortised cost comprises cash and cash equivalents, advances to Banks, loans and advances to customers and other assets. They are initially recognized at fair value plus incremental direct transaction costs and are subsequently measured at amortized cost using the effective interest method less any impairment losses. Interest income from these financial assets is determined using the effective interest method and reported in profit or loss as ‘Interest income’. Fair value through other comprehensive income (FVOCI) Debt Instruments The debt instrument is initially recognised at fair value plus direct transaction costs and subsequently measured at fair value. Gains and losses arising from changes in fair value are included in other comprehensive income within a separate component of equity. Impairment gains or losses, interest revenue and foreign exchange gains and losses are recognised in profit or loss. Upon disposal or derecognition, the cumulative gain or loss previously recognised in OCI is reclassified from equity to profit or loss and recognised in other gains/(losses). Interest income from these financial assets is determined using the effective interest method and recognised in profit or loss as ‘Interest income’. The measurement of credit impairment is based on the three-stage expected credit loss model as applied to financial assets at amortised cost. Fair value through profit or loss (FVTPL) Assets that do not meet the criteria for amortised cost or FVOCI are measured at fair value through profit or loss. The gain or loss arising from changes in fair value of a debt investment that is subsequently measured at fair value through profit or loss and is not part of a hedging relationship is included directly in the income statements and reported as ‘Net gains/(losses) in financial instruments classified as FVTPL’ in the period in which it arises. Interest income from these financial assets is recognised in profit or loss as ‘other income on financial asset at fair value through profit or loss’. Financial liabilities at fair value through profit or loss Trading liabilities are those liabilities that the Bank incurs principally for the purpose of repurchasing in the near term, or holds as part of a portfolio that is managed together for short-term profit. Trading liabilities (including derivatives other than those designated as hedging instruments) are initially recognised and subsequently measured at fair value in the statement of financial position with transaction costs recognised in profit or loss. All changes in fair value are recognised as part of income in profit or loss. Other financial liabilities Deposits, debt securities issued and subordinated liabilities are the Bank’s sources of debt funding. When the Bank sells a financial asset and simultaneously enters into an agreement to repurchase the asset (or a similar asset) at a fixed price on a future date (sale-and-repurchase agreement), the arrangement is accounted for as a deposit, and the underlying asset continues to be recognised in the Bank’s financial statements. The Bank classifies capital instruments as financial liabilities or equity instruments in accordance with the substance of the contractual terms of the instruments. Deposits, debt securities issued and subordinated liabilities are initially measured at fair value minus incremental direct transaction costs, and subsequently measured at their amortised cost using the effective interest method. c. Derecognition Financial assets are derecognised when the right to receive cash flows from the financial assets has expired or where the Bank has transferred substantially all the risks and rewards of ownership. Any interest in the transferred financial assets that is created or retained by the Bank is recognised as a separate asset or liability. On derecognition of a financial asset, the difference between the carrying amount of the asset and the consideration received is recognized in profit or loss. Any interest in transferred financial assets that qualify for derecognition that is created or retained by the Bank is recognized as a separate asset or liability. Any interest in such derecognized financial asset that is created or retained by the Bank is recognized as a separate asset or liability. Financial liabilities are derecognised when the contractual obligations are discharged, cancelled or expire. d. Fair value measurement

Standard Chartered Bank Gambia Limited 64 Annual Report 2019 Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction Strategic report between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

¼¼ In the principal market for the asset or liability; or ¼¼ In the absence of a principal market, in the most advantageous market for the asset or liability The principal or the most advantageous market must be accessible by the Bank. The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest. The Bank measures fair values using the following fair value hierarchy that reflects the significance of the inputs used in making the

measurements: Corporate governance

¼¼ Level 1: Quoted market price (unadjusted) in an active market for an identical instrument. ¼¼ Level 2: Valuation techniques based on observable inputs, either directly (i.e., as prices) or indirectly (i.e., derived from prices).This category includes instruments valued using quoted ¼¼ market prices in active markets for similar instruments; quoted prices for identical or similar instruments in markets that are considered less than active; or other valuation techniques where all significant inputs are directly or indirectly observable from market data. ¼¼ Level 3: Valuation techniques using significant unobservable inputs. This category includes all instruments where the valuation technique includes inputs not based on observable data and the unobservable inputs have a significant effect on the instrument’s valuation. This category includes instruments that are valued based on FINANCIAL STATEMENTS quoted prices for similar instruments where significant unobservable adjustments or assumptions are required to reflect differences between the instruments. For complex instruments such as swaps, the Bank uses proprietary models, which are usually developed from recognised valuation models. Some or all of the inputs into these models may be derived from market prices or rates or are estimates based on assumptions.as appropriate, because valuation techniques cannot appropriately reflect all factors market participants take into account when entering into a transaction. Management believes that these valuation adjustments are necessary and appropriate to fairly measure financial instruments carried at fair value on the statement of financial position. Day 1 profit or loss

When the transaction price differs from the fair value of other observable current market transactions in the same informationSupplementary instrument, or based on a valuation technique whose variables include only data from observable markets, the Bank immediately recognises the difference between the transaction price and fair value (a Day 1 profit or loss) in Net trading income. In cases where fair value is determined using data which is not observable, the difference between the transaction price and model value is only recognised in the profit or loss when the inputs become observable, or when the instrument is derecognised. e. Reclassification of financial assets For a financial asset reclassified out of the available-for-sale category, any previous gain or loss on that asset that has been recognised in equity is amortised to profit or loss over the remaining life of the investment using the Effective Interest Rate (EIR) Method. Any difference between the new amortised cost and the expected cash flows is also amortised over the remaining life of the asset using the EIR. If the asset is subsequently determined to be impaired, then the amount recorded in equity is recycled to the profit or loss. Reclassification is at the election of management, and is determined on an instrument by instrument basis. Financial assets are not reclassified subsequent to their initial recognition, except in the period after the Bank changes its business model for managing financial assets. f. Offsetting Financial assets and liabilities are set off and the net amount presented in the statement of financial position when, and only when, the Bank has a legally enforceable right to set off the amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously. Income and expenses are presented on a net basis only when permitted by the accounting standards, or for gains and losses arising from a group of similar transactions such as in the Bank’s trading activity.

65 Notes to the Financial statements financial statements

Notes to the financial statements continued for the year ended 31 December 2019

g. Modification Financial assets If the terms of a financial asset were modified, then the Bank evaluated whether the cash flows of the modified asset were substantially different. If the cash flows were substantially different, then the contractual rights to cash flows from the original financial asset were deemed to have expired. In this case, the original financial asset was derecognised and a new financial asset was recognised at fair value. If the terms of a financial asset were modified because of financial difficulties of the borrower and the asset was not derecognised, then impairment of the asset was measured using the pre- modification interest rate. Financial liabilities The Bank derecognised a financial liability when its terms were modified and the cash flows of the modified liability were substantially different. In this case, a new financial liability based on the modified terms was recognised at fair value. The difference between the carrying amount of the financial liability extinguished and consideration paid was recognised in profit or loss. Consideration paid included non-financial assets transferred, if any, and the assumption of liabilities, including the new modified financial liability. If the modification of a financial liability was not accounted for as derecognition, then any costs and fees incurred were recognised as an adjustment to the carrying amount of the liability and amortised over the remaining term of the modified financial liability by re-computing the effective interest rate on the instrument. Financial assets If the terms of a financial asset are modified, then the Bank evaluates whether the cash flows of the modified asset are substantially different. If the cash flows are substantially different, then the contractual rights to cash flows from the original financial asset are deemed to have expired. In this case, the original financial asset is derecognised and a new financial asset is recognised at fair value plus any eligible transaction costs. Any fees received as part of the modification are accounted for as follows:

¼¼ fees that are considered in determining the fair value of the new asset and fees that represent reimbursement of eligible transaction costs are included in the initial measurement of the asset; and ¼¼ other fees are included in profit or loss as part of the gain or loss on derecognition. If cash flows are modified when the borrower is in financial difficulties, then the objective of the modification is usually to maximise recovery of the original contractual terms rather than to originate a new asset with substantially different terms. If the Bank plans to modify a financial asset in a way that would result in forgiveness of cash flows, then it first considers whether a portion of the asset should be written off before the modification takes place (see below for write-off policy). This approach impacts the result of the quantitative evaluation and means that the derecognition criteria are not usually met in such cases. If the modification of a financial asset measured at amortised cost or FVOCI does not result in derecognition of the financial asset, then the Bank first recalculates the gross carrying amount of the financial asset using the original effective interest rate of the asset and recognises the resulting adjustment as a modification gain or loss in profit or loss. For floating-rate financial assets, the original effective interest rate used to calculate the modification gain or loss is adjusted to reflect current market terms at the time of the modification. Any costs or fees incurred and fees received as part of the modification adjust the gross carrying amount of the modified financial asset and are amortised over the remaining term of the modified financial asset. h. Identification and measurement of impairment The Bank assesses at each statement of financial position date whether there is objective evidence that a financial asset or group of financial assets are impaired. A financial asset or a group of financial assets is impaired and impairment losses are incurred if, and only if, there is objective evidence of impairment as a result of one or more events that occurred after initial recognition of the asset (a “loss event”), and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated. Objective evidence that financial assets are impaired can include default or delinquency by a borrower, restructuring of a loan and other observable data that suggests adverse changes in the payment status of the borrower.

Standard Chartered Bank Gambia Limited 66 Annual Report 2019 The Bank first assesses whether objective evidence of impairment exists individually for financial assets that are Strategic report individually significant, and individually or collectively for financial assets that are not individually significant. If the Bank determines that no objective evidence of impairment exists for an individually assessed financial asset, whether significant or not, it includes the asset in a group of financial assets with similar credit risk characteristics and collectively assesses them for impairment. Assets that are individually assessed for impairment and for which an impairment loss is or continues to be recognised, are not included in a collective assessment of impairment. If there is objective evidence that an impairment loss on a loan and receivable has been incurred, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred), discounted at the asset’s original effective interest rate. The carrying amount of the asset is reduced through the use of an allowance account and the amount of the loss is recognised in the profit or loss. If a loan and receivable has a variable interest rate, the discount rate for Corporate governance measuring any impairment loss is the current effective interest rate determined under the contract. The calculation of the present value of the estimated future cash flows of a collateralised financial asset reflects cash flows from the realization of the collateral and other sources. For the purposes of a collective evaluation of impairment, financial assets are grouped on the basis of similar credit risk characteristics (i.e. on the basis of the Bank’s grading process which considers asset type, industry, geographical location, collateral type, past due status and other relevant factors).These characteristics are relevant to the estimation of future cash flows for group of such assets being indicative of the debtors’ ability to pay all amounts due according to the contractual terms of the assets being evaluated. Future cash flows in a group of financial assets that are collectively evaluated for impairment are estimated on the

basis of historical loss experience for assets with credit risk characteristics similar to those in the Bank. Historical FINANCIAL STATEMENTS loss experience is adjusted on the basis of current observable data to reflect the effects of current conditions that did not affect the period on which the historical loss experience is based, and to remove the effects of conditions in the historical period that do not exist currently. If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised (such as an improvement in the debtor’s credit rating), the previously recognised impairment loss is reversed by adjusting the allowance account. The amount of the reversal is recognised in the statement of profit or loss. The Bank assesses whether there is objective evidence that a financial asset or a group of financial assets is impaired at each reporting date. In the case of equity investments classified as available for sale, a significant or prolonged

decline in the fair value of the security below its cost is objective evidence of impairment resulting in informationSupplementary the recognition of an impairment loss. In general, the Bank considers a decline of 20% to be significant and a period of nine months to be prolonged. However, in specific circumstances a smaller decline or a shorter period may be appropriate. Impairment losses are recognized by reclassifying the losses accumulated in the other reserve in equity to profit or loss. The cumulative loss that is reclassified from equity to profit or loss is the difference between the acquisition cost, net of any principal repayment and amortization, and the current fair value, less any impairment loss on that financial asset previously recognized in profit or loss. If, in a subsequent period, the fair value of a debt instrument classified as available for sale increases and the increase can objectively be related to an event occurring after the impairment loss was recognized in profit or loss, the impairment loss is reversed through other comprehensive income. a. Significant accounting estimates and judgements The bank’s expected credit loss (ECL) calculations are outputs of complex models with a number of underlying assumptions. The significant judgements and estimates in determining expected credit loss include the bank’s criteria for assessing if there has been a significant increase in credit risk and the development of expected credit loss models, including the choice of inputs relating to macroeconomic variables. The calculation of credit-impairment provisions also involves expert credit judgement to be applied by the credit risk management team based upon counterparty information they receive from various sources including relationship managers and on external market information. b. Expected credit losses Expected credit losses are determined for all financial debt instruments that are classified at amortised cost or fair value through other comprehensive income, undrawn commitments and financial guarantees. An expected credit loss represents the present value of expected cash shortfalls over the residual term of a financial asset, undrawn commitment or financial guarantee. A cash shortfall is the difference between the cash flows that are due in accordance with the contractual terms of the instrument and the cash flows that the bank expects to receive over the contractual life of the instrument.

67 Notes to the Financial statements financial statements

Notes to the financial statements continued for the year ended 31 December 2019

Measurement Expected credit losses are computed as unbiased, probability weighted amounts which are determined by evaluating a range of reasonably possible outcomes, the time value of money, and considering all reasonable and supportable information including that which is forward looking. For material portfolios, the estimate of expected cash shortfalls is determined by multiplying the probability of default (PD) with the loss given default (LGD) with the expected exposure at the time of default (EAD). There may be multiple default events over the lifetime of an instrument. Further details on the components of PD, LGD and EAD are disclosed in the Credit risk section. For less material Retail Banking loan portfolios, the bank has adopted simplified approaches based on historical roll rates or loss rates. Forward-looking economic assumptions are incorporated into the PD, LGD and EAD where relevant and where they influence credit risk, such as GDP growth rates, interest rates, house price indices and commodity prices among others. These assumptions are incorporated using the bank’s most likely forecast for a range of macroeconomic assumptions. These forecasts are determined using all reasonable and supportable information, which includes both internally developed forecasts and those available externally, and are consistent with those used for budgeting, forecasting and capital planning. To account for the potential non-linearity in credit losses, multiple forward-looking scenarios are incorporated into the range of reasonably possible outcomes for all material portfolios. For example, where there is a greater risk of downside credit losses than upside gains, multiple forward-looking economic scenarios are incorporated into the range of reasonably possible outcomes, both in respect of determining the PD (and where relevant, the LGD and EAD) and in determining the overall expected credit loss amounts. These scenarios are determined using a Monte Carlo approach centred around the bank’s most likely forecast of macroeconomic assumptions. The period over which cash shortfalls are determined is generally limited to the maximum contractual period for which the bank is exposed to credit risk. However, for certain revolving credit facilities, which include credit cards or overdrafts, the bank’s exposure to credit risk is not limited to the contractual period. For these instruments, the bank estimates an appropriate life based on the period that the bank is exposed to credit risk, which includes the effect of credit risk management actions such as the withdrawal of undrawn facilities. For credit-impaired financial instruments, the estimate of cash shortfalls may require the use of expert credit judgement. As a practical expedient, the bank may also measure credit impairment on the basis of an instrument’s fair value using an observable market price. The estimate of expected cash shortfalls on a collateralised financial instrument reflects the amount and timing of cash flows that are expected from foreclosure on the collateral less the costs of obtaining and selling the collateral, regardless of whether foreclosure is deemed probable. Cash flows from unfunded credit enhancements held are included within the measurement of expected credit losses if they are part of, or integral to, the contractual terms of the instrument (this includes financial guarantees, unfunded risk participations and other non-derivative credit insurance). Although non-integral credit enhancements do not impact the measurement of expected credit losses, a reimbursement asset is recognised to the extent of the expected credit losses recorded. Cash shortfalls are discounted using the effective interest rate on the financial instrument as calculated at initial recognition or if the instrument has a variable interest rate, the current effective interest rate determined under the contract. Recognition 12 months expected credit losses (Stage 1) Expected credit losses are recognised at the time of initial recognition of a financial instrument and represent the lifetime cash shortfalls arising from possible default events up to 12 months into the future from the balance sheet date. Expected credit losses continue to be determined on this basis until there is either a significant increase in the credit risk of an instrument or the instrument becomes credit- impaired. If an instrument is no longer considered to exhibit a significant increase in credit risk, expected credit losses will revert to being determined on a 12-month basis.

Standard Chartered Bank Gambia Limited 68 Annual Report 2019 Significant increase in credit risk (Stage 2) Strategic report If a financial asset experiences a significant increase in credit risk (SICR) since initial recognition, an expected credit loss provision is recognised for default events that may occur over the lifetime of the asset. Significant increase in credit risk is assessed by comparing the risk of default of an exposure at the reporting date to the risk of default at origination (after taking into account the passage of time). Significant does not mean statistically significant nor is it assessed in the context of changes in expected credit loss. Whether a change in the risk of default is significant or not is assessed using a number of quantitative and qualitative factors, the weight of which depends on the type of product and counterparty. Financial assets that are 30 or more days past due and not credit-impaired will always be considered to have experienced a significant increase in credit risk. For less material portfolios where a loss rate or roll rate approach is applied to compute expected credit loss, significant increase in credit risk is primarily based on 30 days past due. Corporate governance Quantitative factors include an assessment of whether there has been significant increase in the forward-looking probability of default (PD) since origination. A forward-looking PD is one that is adjusted for future economic conditions to the extent these are correlated to changes in credit risk. We compare the residual lifetime PD at the balance sheet date to the residual lifetime PD that was expected at the time of origination for the same point in the term structure and determine whether both the absolute and relative change between the two exceeds predetermined thresholds. To the extent that the differences between the measures of default outlined exceed the defined thresholds, the instrument is considered to have experienced a significant increase in credit risk. Qualitative factors assessed include those linked to current credit risk management processes, such as lending placed on non-purely precautionary early alert (and subject to closer monitoring). A non-purely precautionary early alert account is one which exhibits risk or potential weaknesses of a material nature requiring closer monitoring, FINANCIAL STATEMENTS supervision, or attention by management. Weaknesses in such a borrower’s account, if left uncorrected, could result in deterioration of repayment prospects and the likelihood of being downgraded. Indicators could include a rapid erosion of position within the industry, concerns over management’s ability to manage operations, weak/ deteriorating operating results, liquidity strain and overdue balances among other factors. Credit impaired (or defaulted) exposures (Stage 3) Financial assets that are credit impaired (or in default) represent those that are at least 90 days past due in respect of principal and/or interest. Financial assets are also considered to be credit impaired where the obligors are unlikely to pay on the occurrence of one or more observable events that have a detrimental impact on the estimated future cash flows of the financial asset. It may not be possible to identify a single discrete event but instead the combined effect of

several events may cause financial assets to become credit impaired. informationSupplementary Evidence that a financial asset is credit impaired includes observable data about the following events:

¼¼ Significant financial difficulty of the issuer or borrower; ¼¼ Breach of contract such as default or a past due event; ¼¼ For economic or contractual reasons relating to the borrower’s financial difficulty, the lenders of the borrower have granted the borrower concession/s that lenders would not otherwise consider. This would include forbearance actions; ¼¼ Pending or actual bankruptcy or other financial reorganisation to avoid or delay discharge of the borrower’s obligations; ¼¼ The disappearance of an active market for the applicable financial asset due to financial difficulties of the borrower; and ¼¼ Purchase or origination of a financial asset at a deep discount that reflects incurred credit losses. Irrevocable lending commitments to a credit impaired obligor that have not yet been drawn down are also included within the stage 3 credit impairment provision to the extent that the commitment cannot be withdrawn. Loss provisions against credit impaired financial assets are determined based on an assessment of the recoverable cash flows under a range of scenarios, including the realisation of any collateral held where appropriate. The loss provisions held represent the difference between the present value of the cash flows expected to be recovered, discounted at the instrument’s original effective interest rate, and the gross carrying value of the instrument prior to any credit impairment. The bank’s definition of default is aligned with definition of default as set out in IFRS 9. Expert credit judgement For Global Banking, borrowers are graded by credit risk management on a credit grading (CG) scale from CG1 to CG14. Once a borrower starts to exhibit credit deterioration, it will move along the credit grading scale in the performing book and when it is classified as CG12 the credit assessment and oversight of the loan will normally be performed by Group Special Assets Management (GSAM). Borrowers graded CG12 exhibit well-defined weaknesses in areas such as management and/or performance but there is no current expectation of a loss of principal or interest.

69 Notes to the Financial statements financial statements

Notes to the financial statements continued for the year ended 31 December 2019

Where the impairment assessment indicates that there will be a loss of principal on a loan, the borrower is graded a CG14 while borrowers of other credit impaired loans are graded CG13. Instruments graded CG13 or CG14 are regarded as non-performing loans, i.e. Stage 3 or credit impaired exposures. For individually significant financial assets within Stage 3, Group Special Asset Management (GSAM) will consider all judgements that have an impact on the expected future cash flows of the asset. These include: the business prospects, industry and geo-political climate of the customer, quality of realisable value of collateral, the bank’s legal position relative to other claimants and any renegotiation/ forbearance/ modification options. The difference between the loan carrying amount and the discounted expected future cash flows will result in the stage 3 credit impairment amount. The future cash flow calculation involves significant judgements and estimates. As new information becomes available and further negotiations/forbearance measures are taken the estimates of the future cash flows will be revised, and will have an impact on the future cash flow analysis. For financial assets which are not individually significant, such as the Retail Banking portfolio or small business loans, which comprise a large number of homogenous loans that share similar characteristics, statistical estimates and techniques are used, as well as credit scoring analysis. Retail Banking clients are considered credit impaired where they are more 90 days past due. Retail Banking products are also considered credit impaired if the borrower files for bankruptcy or other forbearance programme, the borrower is deceased or the business is closed in the case of a small business, or if the borrower surrenders the collateral, or there is an identified fraud on the account. Additionally, if the account is unsecured and the borrower has other credit accounts with the bank that are considered credit impaired, the account may be also be credit impaired. Techniques used to compute impairment amounts use models which analyse historical repayment and default rates over a time horizon. Where various models are used, judgement is required to analyse the available information provided and select the appropriate model or combination of models to use. Expert credit judgement is also applied to determine whether any post-model adjustments are required for credit risk elements which are not captured by the models. Write-offs of credit impaired instruments and reversal of impairment To the extent a financial debt instrument is considered irrecoverable, the applicable portion of the gross carrying value is written off against the related loan provision. Such loans are written off after all the necessary procedures have been completed, it is decided that there is no realistic probability of recovery and the amount of the loss has been determined. Subsequent recoveries of amounts previously written off decrease the amount of the provision for loan impairment in the income statement. If, in a subsequent period, the amount of the credit impairment loss decreases and the decrease can be related objectively to an event occurring after the credit impairment was recognised (such as an improvement in the debtor’s credit rating), the previously recognised credit impairment loss is reversed by adjusting the provision account. The amount of the reversal is recognised in the income statement. Improvement in credit risk A period may elapse from the point at which instruments enter lifetime expected credit losses (stage 2 or stage 3) and are reclassified back to 12 month expected credit losses (stage 1). For financial assets that are credit- impaired (stage 3), a transfer to stage 2 or stage 1 is only permitted where the instrument is no longer considered to be credit-impaired. An instrument will no longer be considered credit-impaired when there is no shortfall of cash flows compared to the original contractual terms. For financial assets within stage 2, these can only be transferred to stage 1 when they are no longer considered to have experienced a significant increase in credit risk. Where significant increase in credit risk was determined using quantitative measures, the instruments will automatically transfer back to stage 1 when the original PD based transfer criteria are no longer met. Where instruments were transferred to stage 2 due to an assessment of qualitative factors, the issues that led to the reclassification must be cured before the instruments can be reclassified to stage1. This includes instances where management actions led to instruments being classified as stage 2, requiring that action to be resolved before loans are reclassified to stage 1. Presentation of allowance for ECL in the statement of financial position Loss allowances for ECL are presented in the statement of financial position as follows:

¼¼ financial assets measured at amortised cost: as a deduction from the gross carrying amount of the assets; ¼¼ loan commitments and financial guarantee contracts: generally, as a provision; ¼¼ where a financial instrument includes both a drawn and an undrawn component, and the Bank cannot identify the ECL on the loan commitment component separately from those on the drawn component: the Bank presents a combined loss allowance for both components. The combined amount is presented as a deduction from the

Standard Chartered Bank Gambia Limited 70 Annual Report 2019 gross carrying amount of the drawn component. Any excess of the loss allowance over the gross amount of Strategic report the drawn component is presented as a provision; and ¼¼ debt instruments measured at FVOCI: no loss allowance is recognised in the statement of financial position because the carrying amount of these assets is their fair value. However, the loss allowance is disclosed and is recognised in the fair value reserve. 1.2.8 Investment Securities This comprises investments in short-term Government securities and medium-term investments in Government and other securities such as treasury bills and bonds. Investment securities are categorized as available-for-sale (as applicable before 1 January 2018) or Debt securities at FVOCI (as applicable from 1 January 2018) or trading financial assets and carried in the statement of financial position at fair value. Corporate governance 1.2.9 Loans and Advances This is mainly made up of loans and advances to customers. Loans and advances are carried in the statement of financial position at amortised cost, i.e. gross receivable less impairment allowance. 1.2.10 Property, Plant and Equipment a. Recognition and measurement Land and buildings comprise mainly branches and offices. All property, plant and equipment are stated at cost less accumulated depreciation. Cost includes expenditure that is directly attributable to the acquisition of the assets. The cost of self-constructed assets includes the cost of materials and direct labour and any other costs directly attributable to bringing the asset to a working condition for its intended use. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment. FINANCIAL STATEMENTS b. Subsequent costs Subsequent costs are included in the asset’s carrying amount or are recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Bank and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the income statement during the financial period in which they are incurred. c. Work in progress Fixed Assets may be classified as work-in-progress if it is probable that future economic benefits will flow to the Bank and the cost can be measured reliably. Typically these are items that have not yet been brought to the location and/or condition necessary for it to be capable of operating in the manner intended by management. informationSupplementary Amounts held within work-in-progress that are substantially complete, in common with other fixed assets, are required to be assessed for impairment. Where asset lives are short (technological assets for example) and the assets are held as WIP for a significant period, impairment (through technological obsolescence) is more likely to occur. In such situations, if the assets are generic in nature and do not require significant modification to bring them into use, it would be more appropriate to hold the assets within fixed assets and amortise them. Assets that would typically fall into this category are Computers, screens and other items that require little modification to bring them into use. In general, assets should not be held in work in progress for a significant period unless it relates to a significant construction project (a building for example). d. Depreciation Depreciation is recognised in the profit or loss on a straight-line basis over the estimated useful lives of each part of an item of property and equipment. Leased assets are depreciated over the shorter of the lease term and the useful life of the asset. Land is not depreciated. Depreciation on other assets is calculated using the straight-line method to allocate their cost to their residual values over their estimated useful lives, as follows: Buildings - 50 years Fixtures & fittings - 5 years Fixed equipment - 10 years Office equipment - 3 years Computer hardware - 3 years Motor vehicles ` - 4 years Leasehold improvements - Over the unexpired lease term Leasehold land and buildings - Over the period of the lease The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each statement of financial position date. Gains and losses on disposals are included in the income statement.

71 Notes to the Financial statements financial statements

Notes to the financial statements continued for the year ended 31 December 2019

1.2.11 Intangible Assets Software Software acquired by the Bank is measured at cost less accumulated amortisation and accumulated impairment losses. Subsequent expenditure on software is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure is expensed as incurred. Amortisation is recognised in profit or loss on a straight-line basis over the estimated useful life of the software, from the date that it is available for use. The estimated useful life of software is three to five years. 1.2.12 Impairment of Non-Financial Assets The carrying amount of the Bank’s non-financial assets other than deferred tax assets, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists then the asset’s recoverable amount is estimated. An impairment loss is recognised if the carrying amount of an asset exceeds its recoverable amount. The recoverable amount of an asset is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using pre-tax discount rate that reflects current market assessment of the time value of money and risks specific to the asset. Impairment losses are recognised in the profit or loss. Impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised. 1.2.13 Provisions and contingencies a. Provisions A provision is recognised if, as a result of a past event, the Bank has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability. b. Contingent Liabilities A contingent liability is a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the group, or a present obligation that arises from past events but is not recognised because it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation; or the amount of the obligation cannot be measured with sufficient reliability. If the likelihood of an outflow of resources is remote, the possible obligation is neither a provision nor a contingent liability and no disclosure is made. 1.2.14 Financial Guarantees and Loan Commitments Financial guarantees are contracts that require the bank to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make payment when due in accordance with the original or modified terms of a debt instrument. Loan commitments are firm commitments to provide credit under pre- specified terms and conditions. Liabilities arising from financial guarantees or commitments to provide a loan at below-market interest rates are initially recognized at fair value and amortized over the life of the guarantee or commitment. The liability is subsequently carried at the higher of the amortized amount and the present value of any expected payments to settle the liability, when payment becomes probable. Financial guarantees and commitments to provide a loan at below-market rates are included within other liabilities. 1.2.15 Employee Benefits a. Defined contribution plans Obligations for contributions to defined contribution pension plans are recognised as an expense in the income statement when they are due.

Standard Chartered Bank Gambia Limited 72 Annual Report 2019 b. Termination Benefits Strategic report Termination benefits are recognised as an expense when the Bank is demonstrably committed, without realistic possibility of withdrawal, to a formal detailed plan to terminate employment before the normal retirement date. Termination benefits for voluntary redundancies are recognised if the Bank has made an offer encouraging voluntary redundancy, it is probable that the offer will be accepted and the number of acceptances can be estimated reliably. c. Short Term Benefits Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided.

A provision is recognised for the amount expected to be paid under short-term cash bonus plans if the Bank has a Corporate governance present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably. d. Share-based payments The bank operates a cash settled share based compensation plan. The awards are revalued at each year end date and a liability recognised on the statement of financial position for all unpaid amounts, with any changes in fair value charged or credited to staff cost in the income statement. Where forfeitures occur prior to vesting that are attributable to factors other than a failure to satisfy market-based performance conditions, the cumulative charge incurred up to the date of forfeiture is credited to the income statement. 1.2.16 Share Capital and Reserves FINANCIAL STATEMENTS a. Ordinary Share Capital Ordinary shares are classified as equity. The Bank classifies capital and equity instruments in accordance with the contractual terms of the instrument. Incremental costs directly attributable to the issue of ordinary shares, net of any tax effects are recognised as a deduction from equity. b. Dividends on ordinary shares Dividends on ordinary shares are recognised in equity in the period in which they are approved by the Bank’s shareholders. Dividends for the period that are declared after the end of the reporting period are dealt with in the subsequent events note. c. Share premium Supplementary informationSupplementary Premiums from the issue of shares are reported in share premium. d. Statutory reserves Section 19 of the Banking Act 2009 requires the Bank to make an annual appropriation to a statutory reserve. e. Credit risk reserves Central Bank of The Gambia requires all Banks to create a reserve for the difference between impairment charge determined in line with the principles of IFRS and impairment charge determined in line with its prudential guidelines issued. This reserve is not available for distribution to shareholders. f. Retained earnings Retained earnings comprise the undistributed profits from previous periods which have not been reclassified to any specified reserves. g. Fair value reserve This comprises fair value movements on equity instruments. 1.2.17 Interest a. Effective interest rate Interest income and expense were recognised in profit or loss using the effective interest method. The effective interest rate was the rate that exactly discounted the estimated future cash payments and receipts through the expected life of the financial asset or financial liability (or, where appropriate, a shorter period) to the carrying amount of the financial asset or financial liability. When calculating the effective interest rate, the Bank estimated future cash flows considering all contractual terms of the financial instrument, but not future credit losses. The calculation of the effective interest rate included transaction costs and fees and points paid or received that were an integral part of the effective interest rate. Transaction costs included incremental costs that were directly attributable to the acquisition or issue of a financial asset or financial liability.

73 Notes to the Financial statements financial statements

Notes to the financial statements continued for the year ended 31 December 2019

b. Presentation Interest income calculated using the effective interest method presented in the statement of profit or loss and OCI includes:

¼¼ interest on financial assets and financial liabilities measured at amortised; ¼¼ interest on debt instruments measured at FVOCI; Interest expense presented in the statement of profit or loss and OCI includes financial liabilities measured at amortised cost. Interest income and expense on all trading assets and liabilities were considered to be incidental to the Bank’s trading operations and were presented together with all other changes in the fair value of trading assets and liabilities in net trading income. Interest income and expense on other financial assets and financial liabilities carried at FVTPL were presented in net income from other financial instruments at FVTPL. a. Effective interest rate Interest income and expense are recognised in profit or loss using the effective interest method. The ‘effective interest rate’ is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial instrument to:

¼¼ the gross carrying amount of the financial asset; or ¼¼ the amortised cost of the financial liability. When calculating the effective interest rate for financial instruments other than purchased or originated credit- impaired assets, the bank estimates future cash flows considering all contractual terms of the financial instrument, but not ECL. For purchased or originated credit-impaired financial assets,a credit-adjusted effective interest rate is calculated using estimated future cash flows including ECL. The calculation of the effective interest rate includes transaction costs and fees and points paid or received that are an integral part of the effective interest rate. Transaction costs include incremental costs that are directly attributable to the acquisition or issue of a financial asset or financial liability. b. Amortised cost and gross carrying amount The ‘amortised cost’ of a financial asset or financial liability is the amount at which the financial asset or financial liability is measured on initial recognition minus the principal repayments, plus or minus the cumulative amortisation using the effective interest method of any difference between that initial amount and the maturity amount and, for financial assets, adjusted for any expected credit loss allowance (or impairment allowance before 1 January 2019). The ‘gross carrying amount of a financial asset’ is the amortised cost of a financial asset before adjusting for any expected credit loss allowance. c. Calculation of interest income and expense The effective interest rate of a financial asset or financial liability is calculated on initial recognition of a financial asset or a financial liability. In calculating interest income and expense, the effective interest rate is applied to the gross carrying amount of the asset (when the asset is not credit-impaired) or to the amortised cost of the liability. The effective interest rate is revised as a result of periodic re-estimation of cash flows of floating rate instruments to reflect movements in market rates of interest. For financial assets that have become credit-impaired subsequent to initial recognition, interest income is calculated by applying the effective interest rate to the amortised cost of the financial asset. If the asset is no longer credit-impaired, then the calculation of interest income reverts to the gross basis. For financial assets that were credit- impaired on initial recognition, interest income is calculated by applying the credit-adjusted effective interest rate to the amortised cost of the asset. The calculation of interest income does not revert to a gross basis, even if the credit risk of the asset improves. d. Presentation Interest income calculated using the effective interest method presented in the statement of profit or loss includes:

¼¼ interest on financial assets and financial liabilities measured at amortised cost; ¼¼ interest on debt instruments measured at FVOCI. Interest expense presented in the statement of profit or loss comprise financial liabilities measured at amortised cost.

Standard Chartered Bank Gambia Limited 74 Annual Report 2019 Interest income and expense on all trading assets and liabilities are considered to be incidental to the Bank’s Strategic report trading operations and are presented together with all other changes in the fair value of trading assets and liabilities in net trading income. Interest income and expense on other financial assets and financial liabilities at FVTPL are presented in net income from other financial instruments at FVTPL. 1.2.18 Fees, commission and other income Fees and commissions are generally recognized on an accrual basis when the service has been provided. Fees and commission income and expenses that are an integral part of the effective interest rate on financial instruments are included in the measurement of the effective interest rate.

Other fees and commission income, including account servicing fees, investment management fees, sales Corporate governance commission, placement and arrangement fees and syndication fees - is recognised as the related services are performed. If a loan commitment is not expected to result in the draw-down of a loan, then the related loan commitment fee is recognised on a straight-line basis over the commitment period. Other fees and commission expense relate mainly to transaction and service fees, which are expensed as the services are received. 1.2.19 Net trading income ‘Net trading income’ comprises gains less losses related to trading assets and liabilities, and includes all fair value changes, interest, dividends and foreign exchange differences.

1.2.20 Leases FINANCIAL STATEMENTS a. Where the Bank is the lessee The leases entered into by the Bank are primarily operating leases. The total payments made under operating leases are charged to the profit or loss on a straight-line basis over the period of the lease. When an operating lease is terminated before the lease period has expired, any payment required to be made to the lessor by way of penalty is recognized as an expense in the period in which termination takes place. Where the Bank is a lessee under finance leases, the leased assets are capitalized and included in property and equipment with a corresponding liability to the lessor recognized in other liabilities. Financing charges payable are recognized over the period of the lease based on the interest rate implicit in the lease to give a constant periodic rate of return. informationSupplementary 1.2.21 Income Tax Income tax expense comprises current and deferred tax. Current tax and deferred tax are recognised in profit or loss except to the extent that it relates to items recognised directly in equity or in other comprehensive income. a. Current tax Current tax is the expected tax payable on taxable income or loss for the year, using tax rates enacted or substantively enacted at the financial position date, and any adjustment to tax payable in respect of previous years. Current tax payable also includes any tax liability arising from the declaration of dividends. b. Deferred tax Deferred tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. It is determined using tax rates (and laws) that have been enacted or substantially enacted by the statement of financial position date and are expected to apply when the related deferred income tax asset is realized or the deferred income tax liability is settled. The principal temporary differences arise from depreciation of property, plant and equipment, revaluation of certain financial assets and liabilities including derivative contracts, provisions, for pensions and other post- retirement benefits and tax losses carried forward; and, in relation to acquisitions, on the difference between the fair values of the net assets acquired and their tax base. The rates enacted or substantively enacted at the statement of financial position date are used to determine deferred income tax. However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit nor loss. Deferred tax assets are recognised where it is probable that future taxable profit will be available against which the temporary differences can be settled. 1.2.22 Earnings per share The Bank presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Bank after adjustments for preference dividends by the weighted average number of ordinary shares outstanding during the period. The Bank has no convertible notes and share options, which could potentially dilute its EPS and therefore the Bank’s Basic and diluted EPS are essentially the same. 75 Financial statements Financial risk management

Financial Risk Management for the year ended 31 December 2019

1.3 Principal credit policies The Bank’s credit policies provide a credit strategy for a diversified portfolio of credit risks so as to produce reliable, sustainable and consistent returns to investors and to work towards the framework of Basel I & II Accord. A Country Portfolio Standards which sets the rules and parameters for risk acceptance along industry and customer types has been prepared and approved to guide credit creation. The Country Portfolio Standard which is reviewed annually complies with the regulatory and legal framework of The Gambia. Credits will only be provided after written completion of:

¼¼ Customer Due Diligence (KYC); ¼¼ Full analysis of the risks associated with the counterparties and facilities proposed; and ¼¼ Review of the risk-adjusted return. Risk assessment will include, but need not be limited to, an analysis of: ¼¼ Business environment and general economic outlook. ¼¼ Current and future business prospects. ¼¼ Management strengths and weaknesses. ¼¼ Financial strength, including its ability to repay loans and meet commitments. ¼¼ Projected financials. ¼¼ The size and structure of proposed facilities and the fit with the customer needs. ¼¼ Past performance of facilities. ¼¼ Compliance with the policy requirements and business underlying standards. ¼¼ Absolute revenues and risk adjusted rates of return. ¼¼ Environmental and social risks. 1.3.1 Customer suitability The Bank will not extend credit products/facilities which are inappropriate to the nature and scale of the customer’s business. The Bank ensures that customer:

¼¼ Understands the facilities and the associated risks ¼¼ Has the authority to enter into the facility 1.3.2 Aggregation of customer exposure All limits to customers within a group are aggregated for credit assessment, approval, reporting and regulatory ceiling compliance purpose. It is the responsibility of the transactor/ Relationship Manager and the Credit Officers (Approvers) to ensure that single customer/ group exposure is within regulatory restrictions. 1.3.3 Product programs Only products which are covered by approved product programs (PPG) and/ or country product template, may be provided to the customers. Non-adherence to the PPG constitutes a breach of policy. The Bank has Zero tolerance for non-compliance. 1.3.4 Stress testing Key country triggers appropriate to The Gambia are kept under review and stress tests on the portfolio are carried out whenever significant changes occur or are anticipated in the near future. 1.3.5 Methodology for risk rating All credits are rated by an appropriate scorecard. A scorecard is a credit risk assessment tool that estimates a counterparty’s Probability of Default (PD), or the likelihood that within a specified time horizon, usually one year, a borrower will not meet its obligations with regard to interest and/or principal payments to the bank. Use of an internal scorecard is mandatory and must be undertaken on or prior to the review date. Every Business Credit Application (BCA) must be accompanied by a valid scorecard. The counterparties are graded from the Credit Grade (CG) 1A to 14. The performing accounts are graded CG 1A – 11C on applicable scorecards, based on financial and non-financial factors, of which investment grade accounts are CG 1A to 5B. Problem Accounts including watch-list, substandard, doubtful and lost Accounts are downgraded to CG 12A-14.

Standard Chartered Bank Gambia Limited 76 Annual Report 2019 Each scorecard has a set of financial and non-financial factors used for rating counterparty. Latest audited financials of Strategic report the counterparty are used to obtain the financial score. Non-financial factors are assessed conservatively, accompanied by clear and concise justification. 1.3.6 Enterprise risk review The Bank’s activities expose it to a variety of financial risks and those activities involve the analysis, evaluation, acceptance and management of some degree of risk or combination of risks. Taking risk is core to the financial business, and operational risks are an inevitable consequence of being in business. The Bank’s aim is therefore to achieve an appropriate balance between risk and return whilst minimizing potential adverse effects on the Bank’s financial performance.

Risk management is carried out by Management under the leadership of the Country Chief Risk Officer within risk Corporate governance appetite and policies approved by the Board of Directors. Management identifies, evaluates and manages respective aspects of financial risks with oversight from the Executive Committee (ExCo). The Board provides written principles for overall risk management, as well as written policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, and use of financial instruments. In addition, internal audit is responsible for the independent review of risk management and the control environment. The major types of risks are credit risk, liquidity risk, market risk and operational risks. Market risks includes currency risk, interest rate and other price risks. The Bank’s risk management policies are designed to identify and analyse these risks, to set appropriate risk limits and controls, and to monitor the risks and adherence to limits by means of reliable and up-to-date information systems. The Bank regularly reviews its risk management policies and systems to reflect changes in market, products and emerging best practice. FINANCIAL STATEMENTS 1.3.7 Credit risk The Bank takes on exposure to credit risk, which is the risk that a counterparty will cause a financial loss for the Bank by failing to discharge an obligation. Credit risk is an important risk for the Bank’s business; the Board and management therefore carefully manages its exposure to credit risk. Credit exposures arise principally in lending activities that lead to loans and advances, and investment activities that bring debt securities and other bills into the Bank’s asset portfolio. There is also credit risk in off-balance sheet financial instruments. The credit risk management and control activities are reported to the Board of Directors regularly. 1.3.7 (i) Credit risk measurement

(a) Loans and advances informationSupplementary In measuring credit risk of loans and advances to customers and to other banks at a counterparty level, the Bank reflects the following components (i) the character and capacity to pay of the client or counterparty on its contractual obligations (ii) current exposures to the counterparty and its likely future development (iii) credit history of the counterparty and (iv) the likely recovery ratio in case of default obligations - value of collateral and other ways out. All credits are rated by an appropriate scorecard. A scorecard is a credit risk assessment tool that estimates a counterparty’s Probability of Default (PD), or the likelihood that within a specified time horizon, usually one year, a borrower will not meet its obligations with regard to interest and/or principal payments to the bank. The bank’s scorecards are linked to the Standard and Poors’ international rating scales. The performing accounts are graded CG 1A – 11C on applicable scorecards, based on financial and non-financial factors. Problem Accounts including substandard, doubtful and loss Accounts are downgraded to CG12A-14.

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External Rating: Standard & Poor’s Equivalent Bank’s rating Credit Description of the Grade S&P Mapping Grade (CG) Corp/NBFIs Banks 1A Performing Accounts AAA AAA, AA+ 1B Performing Accounts AA+ AA, AA- 2A Performing Accounts AA A+ 2B Performing Accounts AA- A 3A Performing Accounts A+ A- 3B Performing Accounts A BBB+ 4A Performing Accounts A- BBB+, BBB 4B Performing Accounts BBB+ BBB 5A Performing Accounts BBB BBB- 5B Performing Accounts BBB- BB+ 6A Performing Accounts BB+, BB BB+ 6B Performing Accounts BB 7A Performing Accounts BB, BB- BB 7B Performing Accounts BB- 8A Performing Accounts B+ BB- 8B Performing Accounts B+, B 9A Performing Accounts B B+ 9B Performing Accounts B, B- 10A Performing Accounts B B 10B Performing Accounts B-, CCC 11A Performing Accounts 11B Performing Accounts B- CCC 11C Performing Accounts 12A Problem Account 12B Problem Account 12C Problem Account 13 Problem Account 14 Problem Account

b) Debt securities and other bills For debt securities and other bills, external ratings such as Standard & Poor’s rating or their equivalents are used by Treasury primarily to manage their liquidity risk exposures. 1.3.8 Risk limit control and mitigation policies The Bank manages limits and controls concentrations of credit risk wherever they are identified, in particular, to individual counterparties and groups, and to industries and countries. In terms of Risk Appetite, the Bank structures the levels of credit risk it undertakes by placing limits on the amount of risk acceptable in relation to one borrower, or groups of borrowers (single obligor limits), and to industry segments. Such risks are monitored on a revolving basis and subject to an annual or more frequent review, when considered necessary. Limits on the level of credit risk by product and industry sector are approved by the Board of Directors. The exposure to any one borrower including banks and brokers is further restricted by sub-limits covering on and off-balance sheet exposures, and daily delivery risk limits in relation to trading items such as forward foreign exchange contracts. Actual exposures against limits are monitored daily. The Board has set risk based credit authority for credit officers and the Management Approvals Committee in Nigeria and these are based on nominal exposures. In addition to this, the Board has recognized the existence of credit experts in the Group credit function who also assess and where appropriate recommend for approval credit applications above defined thresholds.

Standard Chartered Bank Gambia Limited 78 Annual Report 2019 Approval limits are reviewed by the Board of Directors from time to time in line with the prevailing economic Strategic report conditions. Exposure to credit risk is also managed through regular analysis of the ability of borrowers and potential borrowers to meet interest and capital repayment obligations and by changing these lending limits where appropriate. Some other specific control and mitigation measures are outlined below. (a) Collateral The Bank employs a range of policies and practices to mitigate credit risk. The most traditional of these is the taking of security for funds advanced, which is common practice. The Bank implements guidelines on the acceptability of specific classes of collateral or credit risk mitigation. The principal collateral types for loans and advances are: i Mortgages over residential properties

Longer-term finance and lending to corporate entities are generally secured; revolving individual credit facilities are Corporate governance generally unsecured. In addition, in order to minimize the credit loss the Bank will seek additional collateral from the counterparty as soon as loss indicators are noticed for the relevant individual loans and advances. Collateral held as security for financial assets other than loans and advances is determined by the nature of the instrument. Debt securities, treasury and other eligible bills are generally unsecured, with the exception of asset- backed securities and similar instruments, which are secured by portfolios of financial instruments. (b) Master netting arrangements The Bank further restricts its exposure to credit losses by entering into master netting arrangements with counterparties with which it undertakes a significant volume of transactions. Master netting arrangements do not generally result in an

offset of balance sheet assets and liabilities, as transactions are usually settled on a gross basis. However, the credit FINANCIAL STATEMENTS risk associated with favourable contracts is reduced by a master netting arrangement to the extent that if a default occurs, all amounts with the counterparty are terminated and settled on a net basis. (c) Credit-related commitments The primary purpose of these instruments is to ensure that funds are available to a customer as required. Guarantees and standby letters of credit carry the same credit risk as loans. Documentary and commercial letters of credit - which are written undertakings by the Bank on behalf of a customer authorizing a third party to draw drafts on the Bank up to a stipulated amount under specific terms and conditions - are collateralized by the underlying shipments of goods to which they relate and therefore carry less risk than a direct loan. 1.3.9 Provisioning policies Supplementary informationSupplementary The internal and external rating systems described above focus more on credit-quality mapping from the inception of the lending and investment activities. In contrast, loan loss provisions are recognised for financial reporting purposes only for losses that have been incurred at the balance sheet date based on criteria set out in IFRS. 1.3.10 Maximum exposure to credit risk The table below presents the Bank’s maximum exposure to credit risk of its on-balance sheet and off-balance sheet financial instruments as at 31 December 2019, before taking into account any collateral held or other credit enhancements. For on-balance sheet instruments, the maximum exposure to credit risk is the carrying amount reported on the balance sheet. For off-balance sheet instruments, the maximum exposure to credit risk represents the contractual nominal amounts. The Bank’s exposure to credit risk is spread across industry sectors. The Bank sets limits on the exposure to any counterparty and credit risk is spread over a variety of different personal and commercial customers. The Bank’s maximum exposure to credit risk has increased by GMD 904.7million when compared with 2018 (2018: GMD 4.3 billion). Exposure to loans and advances to customers has increased by GMD 33.8 million in 2019 as compared to 2018. All amounts in thousands of Gambian Dalasi unless otherwise stated 31-Dec-2019 31-Dec-2018 Deposits with Banks 937,672 822,320 Loans and advances to customers 332,781 298,949 Investment securities 3,365,802 2,744,322 Other receivables 282,013 19,581 Irrevocable letters of credit 259,958 35,452 Performance bonds and guarantees 5,552 220,587 Documentary credits and short term trade-related transactions - 137,8 67 5,183,778 4,279,078

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1.3.11 Collateral Collateral is held to mitigate credit risk exposures and risk mitigation policies determine the eligibility of collateral types. Collateral types that are eligible for risk mitigation include: cash; residential, commercial and industrial property; fixed assets such as motor vehicles, plant and machinery; marketable securities; commodities; bank guarantees; and letters of credit. For certain types of lending – typically mortgages, asset financing – the right to take charge over physical assets is significant in terms of determining appropriate pricing and recoverability in the event of default. Collateral is reported in accordance with our risk mitigation policy, which prescribes the frequency of valuation for different collateral types, based on the level of price volatility of each type of collateral and the nature of the underlying product or risk exposure. Where appropriate, collateral values are adjusted to reflect current market conditions, its probability of recovery and the period of time to realize the collateral in the event of possession. 1.3.12 Loans and advances The requirement for collateral is not a substitute for the ability to pay, which is the primary consideration for any lending decisions. In determining the financial effect of collateral held against loans neither past due nor impaired, we have assessed the significance of the collateral held in relation to the type of lending. For loans and advances to customers, the Bank held the following amounts of collateral, adjusted where appropriate as discussed above. These collateral are in the form of mortgage interests over property, other registered securities over assets, and guarantees. Estimates of fair value are based on the value of collateral assessed at the time of borrowing, and generally are not updated except when a loan is individually assessed as impaired. Collateral is not normally held for loans and advances to banks, except when securities are held as part of reverse repurchase and securities borrowing activity. Collateral is not usually held against investment securities, and no such collateral was held at 31 December 2019 or 2018. Non-tangible collateral – such as guarantees and letters of credit – may also be held against corporate exposures although the financial effect of this type of collateral is less significant in terms of recoveries. However, this type of collateral is considered when determining probability of default and other credit related factors. 1.3.13 Collateral and other credit enhancements possessed or called upon The Bank obtains assets by taking possession of collateral or calling upon other credit enhancements (such as guarantees). Repossessed properties are sold in an orderly fashion. Where the proceeds are in excess of the outstanding loan balance they are returned to the borrower. 1.3.14 Off-balance sheet exposures For certain types of exposures such as Letters of Credit and Guarantees, the Bank obtains collateral such as cash depending on internal credit risk assessments. However, for trade finance products such as Letters of Credit the Bank will also hold legal title to the underlying assets should a default occur. Value of collateral held (a) Industry sectors The Bank holds collateral against loans and advances to customers in the form of mortgage interests over property, other registered securities over assets, and guarantees. Estimates of fair value are based on the value of collateral assessed at the time of borrowing, and generally are not updated except when a loan is individually assessed as impaired. Collateral is not usually held against investment securities, and no such collateral was held at 31 December 2019 and 2018. The following table breaks down the Bank’s maximum credit exposure at their carrying amounts, as categorized by industry sector as at balance sheet date.

Standard Chartered Bank Gambia Limited 80 Annual Report 2019 All amounts in thousands of Gambian Dalasi unless otherwise stated Strategic report 31-Dec-2019 31-Dec-2018 Against individually impaired Property - - - - Against collectively impaired Property - - - -

Against past due but not impaired Corporate governance Property - - Other - - - - Against neither past due nor impaired 212,428 231,923 Property 92,196 67,027 Other 304,624 298,949 Total 304,624 298,949 FINANCIAL STATEMENTS 1.3.15 Market risk We recognise market risk as the potential for loss of earnings or economic value due to adverse changes in financial market rates or prices. Our exposure to market risk arises principally from customer-driven transactions. The objective of our market risk policies and processes is to obtain the best balance of risk and return whilst meeting customers’ requirements. The primary categories of market risk for Standard Chartered Bank Gambia Limited are:

¼¼ Interest rate risk: arising from changes in yield curves, credit spreads and implied volatilities on interest rate options. ¼¼ Currency exchange rate risk: arising from changes in exchange rates and implied volatilities on foreign exchange

Options. informationSupplementary ¼¼ Commodity price risk: arising from changes in commodity prices and commodity option implied volatilities; covering energy, precious metals, base metals and agriculture. ¼¼ Equity price risk: arising from changes in the prices of equities, equity indices, equity baskets and implied volatilities on related options. Repricing Risk Assumptions The assets and liabilities are grouped in different time periods based on assumptions approved by country ALCO:

¼¼ Commercial assets are repriced using the equated cash flow method which spreads the cash flows across 1 year to conform to the FTP process. ¼¼ Non-maturing products (CASA, verdrafts, etc.) are profiled using core non-core assumptions based on the behavioural patterns of those products. ¼¼ Off-balance sheet exposures includes only internal deals and other off-balance sheet exposures (fx forwards) are excluded. ¼¼ There were no internal deals for both period under review. ¼¼ Other products are profiled as per their contractual maturities. The repricing exposures ( PV01 and VaR) are derived using an internally developed model . This is a measure of the price sensitivity of the cash flows to the changes in the price of a security or portfolio. Value at Risk (VaR) We measure the risk of losses arising from future potential adverse movements in market rates, prices and volatilities using a VaR methodology. VaR, in general, is a quantitative measure of market risk that applies recent historical market conditions to estimate the potential future loss in market value that will not be exceeded in a set time period at a set statistical confidence level. VaR is therefore a statistical measure of the potential loss on a portfolio for a given holding period at a determined confidence level. VaR is calculated for expected movements over a minimum of one business day and to a confidence level of 97.5 per cent. This confidence level suggests that potential daily losses, in excess of the VaR measure, are likely to be experienced six times per year. It captures the effects of correlation & diversification across a range of instruments and is SCB’s primary means of controlling market risk. 81 Financial statements Financial risk management

Financial Risk Management for the year ended 31 December 2019 continued

This implies that on 39 trading days out of 40, the losses will be less than the VaR reported by Market Risk. No quantification is made as to the size of the potential loss on the 40th day. SCB calculates VaR using a Historic Simulation methodology using a rolling 250 days of market data. The data is used to simulate possible future P/Ls and depending on the model’s confidence interval, the nth worst loss is taken as VaR. Since SCB measures VaR at 97.5% confidence level, 1 day holding period, SCB’s VaR is therefore the 7th worst loss. This approach is equivalent to taking today’s position then apply rate movements from the last 250 business days to these positions, one day at a time, then generate 250 daily P&L. NB:

¼¼ This report covers exposures on the Local currency book and USD book. (The VaR exposure however covers the entire banking portfolio). ¼¼ The figures reported therein may differ from the audited financial statements as of year-end due to the assumptions alluded to above. ¼¼ The VaR and PV01 sensitivity test were conducted on the assumption of a 500 b.p and100 b.p change (both increase and decrease) in the government yield curve across all tenors. ¼¼ The GOVT yield curve was used for the simulations on the back of the fact that the VaR exposures are largely driven by the local book and also due to the volatility in the GOVT yield curve comparative to the LIBOR which is relatively stable . 1.3.16 Foreign exchange risk The Bank takes on exposure to the effects of fluctuations in the prevailing foreign currency exchange rates on its financial position and cash flows. The Board sets limits on the level of exposure by currency and in aggregate for both overnight and intra-day positions, which are monitored daily. The table below summarizes the Bank’s exposure to foreign currency exchange rate risk at 31 December 2019. Included in the table are the Bank’s financial instruments at carrying amounts, categorized by currency. All amounts in thousands of Gambian Dalasi unless otherwise stated 31-Dec-19 Dalasi Dollar GBP Euro Others Total Assets Cash and balances with central bank 807,090 93,415 85,045 433,844 106 1,419,499 Financial assets – AFS 3,365,802 - - - - 3,365,802 Due from other banks 235 864,405 73,032 - - 937,672 Loans and advances to customers 332,781 - - - - 332,781 Other assets 399,508 - 272 - 40 399,820 Total financial assets 4,905,415 957,820 158,348 433,844 146 6,455,573

Liabilities Customer deposits 3,667,510 806,326 82,690 325,777 - 4,882,302 Due to other banks 183,272 - - 121,551 135 304,958 Income tax payable 70,379 - - - - 70,379 Other liabilities 235,686 287,432 7,898 21,319 117 552,451 Total financial liabilities 4,156,846 1,093,757 90,589 468,646 252 5,810,091 Net assets/(exposures) 748,569 (135,938) 67,760 (34,802) (107) 645,483

Standard Chartered Bank Gambia Limited 82 Annual Report 2019 Strategic report All amounts in thousands of Gambian Dalasi unless otherwise stated 31-Dec-18 Dalasi Dollar GBP Euro Others Total Assets Cash and balances with central bank 1,089,911 41,369 9,160 190,084 110,558 1,441,082 Financial assets – AFS 2,744,322 - - - - 2,744,322 Due from other banks - 594,195 90,772 137,353 - 822,320 Loans and advances to customers 298,949 - - - - 298,949 Corporate governance Other assets 59,445 1,645 196 75 26 61,387 Total financial assets 4,192,627 6 37, 20 9 100,128 327,512 110,584 5,368,060

Liabilities Customer deposits 4,377, 26 3 - - - - 4,377, 26 3 Due to other banks - 46,756 - 1,255 - 48,011 Deferred tax liabilities 22,388 - - - - 22,388 Current income tax 67,73 9 - - - - 67,73 9 Other liabilities 214,024 191,893 - - - 405,917 Total financial liabilities 4,681,413 238,649 - 1,255 - 4,921,318 FINANCIAL STATEMENTS

Net assets (488,786) 398,560 100,128 326,257 110,584 446,742

1.3.17 Repricing profile – On balance sheet All amounts in thousands of Gambian Dalasi unless otherwise stated 31-Dec-19 O/N - 1 8 day-1 4 - 6 7 - 12 Total week month 1 - 3 months months months Local currency book

Total Assets 4,746,893 1,019,450 342,740 691,895 850,761 1,842,047 informationSupplementary Total Liabilities (4,913,883) (4,208,482) (45,891) (126,175) (290,212) (243,123) Repricing Gap (166,990) (3,189,031) 296,849 565,720 560,548 1,598,924 Repricing Gap (USD equiv) (3,260) (62,261) 5,796 11,045 10,944 31,217 PV01 (USD) 295 (5) 114 7 35 144

Foreign currency book Total Assets 1,708,680 1,496,917 175,602 15,550 20,611 0 Total Liabilities (896,208) (682,214) (175,602) (15,366) (23,025) 0 Repricing Gap 812,473 814,703 0 184 (2,415) 0 Repricing Gap (USD equiv) 15,862 15,906 0 4 (47) 0 PV01 (USD) 604 (2) 249 12 (293) 638 Value at Risk (USD) 9,039 Sensitivity analysis of interest rate exposure to Earnings (443)

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All amounts in thousands of Gambian Dalasi unless otherwise stated 31-Dec-19 O/N - 1 8 day-1 4 - 6 7 - 12 Total week month 1 - 3 months months months All VaR and PV01 figures are in thousands of US Dollar. Local currency book (PV01) 295 (5) 114 7 35 144 Value at Risk (USD) 9,039

Scenario 1b: 500 bp decrease in Govt yield curve across all tenors 295 (5) 114 7 35 144 Local currency book (PV01) 8,399 Value at Risk (USD) Scenario 2a: 100 bp increase in Govt yield curve across all tenors 295 (5) 114 7 35 144 9,324 Local currency book (PV01) Value at Risk (USD) Scenario 2b: 100 bp decrease in Govt yield across all tenors Local currency book (PV01) 295 (5) 114 7 35 144 Value at Risk (USD) 9,482

1.3.17 Repricing profile – On balance sheet continued All amounts in thousands of Gambian Dalasi unless otherwise stated 31 December 2018 8 day-1 Total O/N - 1 week month 1 - 3 months 4 - 6 months 7 - 12 months Local currency book Total Assets 4,638,000 1,618,000 376,000 522,000 759,000 1,363,000 Total Liabilities (4,328,000) (542,000) (1,308,000) (545,000) (644,000) (1,289,000) Repricing Gap 310,000 1,076,000 (932,000) (23,000) 115,000 74,000 Repricing Gap (USD equiv) 6,230 21,834 (18,912) (467) 2,273 1,502 PV01 (USD) 952 (12) 218 (36) (64) 846

Foreign currency book Total Assets 1,134,000 512,000 592,000 21,000 9,000 - Total Liabilities (1,383,000) (793,000) (495,000) (7,000) (45,000) (43,000) Repricing Gap (249,000) (281,000) 97,000 14,000 (36,000) (43,000)

Repricing Gap (USD equiv) (5,053) (5,702) 1,968 284 (731) (873)

PV01 (USD) 272 (33) 96 4 48 157 Value at Risk (USD) 7863

Standard Chartered Bank Gambia Limited 84 Annual Report 2019 All amounts in thousands of Gambian Dalasi unless otherwise stated Strategic report 31 December 2018 8 day-1 Total O/N - 1 week month 1 - 3 months 4 - 6 months 7 - 12 months Sensitivity analysis of interest rate exposure to Earnings All VaR and PV01 figures are in thousands of US Dollar. Local currency book (PV01) 952 (12) 218 (36) (64) 846 Value at Risk (USD) 8,117 Scenario 1b: 500 bp decrease in Corporate governance Govt yield curve across all tenors Local currency book (PV01) 952 (12) 218 (36) (64) 846 Value at Risk (USD) 8,117 Scenario 2a: 100 bp increase in Govt yield curve across all tenors Local currency book (PV01) 952 (12) 218 (36) (64) 846 Value at Risk (USD) 8,117

Scenario 2b: 100 bp decrease in Govt yield across all tenors FINANCIAL STATEMENTS Local currency book (PV01) 952 (12) 218 (36) (64) 846 Value at Risk (USD) 8,117

Market risk Management Repricing GAP analysis The gap analysis is the method used for interest rate risk assessment and it shows the difference between interest sensitive assets and interest sensitive liabilities over a particular period of time. The gap analysis includes both Assets and Liabilities with fixed and with floating interest rate. Under the gap analysis the bank’s Assets and Liabilities are grouped in different time periods depending on

their maturity (in case of fixed interest rate) or on the time remaining until the next change of their prices (in informationSupplementary case of floating interest rate). The allocation of interest sensitive Assets and Liabilities to different revaluation/ repricing periods allows for showing the gap for each of those periods. The bank has a positive gap when the sum of the Assets being revalued over a particular period is higher than the sum of the Liabilities for the same period and vice-versa. This gap is a normal phenomenon and it cannot be avoided or completely eliminated. If the bank has a negative gap and interest rates rise, the net interest income will decrease as more liabilities than assets will be revalued at higher interest rates. If interest rates drop however, the bank’s net interest income will improve. On the other hand, if the bank has a positive repricing gap and interest rates increase, the net interest income will improve as more Assets will be revalued at higher interest rates. 1.3.18 Liquidity risk Liquidity risk is the risk that the Bank is unable to meet its payment obligations associated with its financial liabilities when they fall due and to replace funds when they are withdrawn. The consequence may be the failure to meet obligations to repay depositors and fulfil commitments to lend. Liquidity risk management process The Bank’s liquidity management process is primarily the responsibility of the Assets and Liabilities Committee (ALCO). Asset Liability Management desk is the executory arm of ALCO and its functions includes: a. Day-to-day funding, managed by monitoring future cash flows to ensure that requirements can be met. This includes replenishment of funds as they mature or are borrowed by customers. The Bank maintains an active presence in money markets to enable this to happen b. Maintaining a portfolio of highly marketable assets that can easily be liquidated as protection against any unforeseen interruption to cash flow c. Monitoring balance sheet liquidity ratios against internal and regulatory requirements (in conjunction with financial control unit) and d. Managing the concentration and profile of debt maturities. 85 Financial statements Financial risk management

Financial Risk Management continued for the year ended 31 December 2019

1.3.19 Funding approach Sources of liquidity are regularly reviewed by Asset Liability Management desk to maintain a wide diversification by currency, geography, provider, product and term. 1.3.20 Credit Risk - Credit Quality Analysis by credit grade of loans and advances Exposure to Credit Risk All amounts in thousands of Gambian Dalasi unless otherwise stated 31 December 2019 Loans and advances to customers Investment securities 31-Dec-2019 31-Dec-2018 31-Dec-2019 31-Dec-2018 Carrying amount 332,781 298,949 3,365,802 2,744,322

Individually impaired Grade 12 - - - - Grade 13 - - - - Grade 14 - - - - Gross amount 332,781 298,949 3,365,802 2,744,322 Allowance for impairment - - - - Carrying amount 332,781 298,949 3,365,802 2,744,322

Individually impaired Grade 1-11: Normal 347,510 317,6 8 4 3,365,802 2,744,322

Grade 12: Watch list - - - - Gross amount 347,510 317,6 8 4 3,365,802 2,744,322 Allowance for impairment (14,729) (18,735) Carrying amount 332,781 298,949 3,365,802 2,744,322

Neither past due nor impaired Grade 1-11: Normal 347,510 317,6 8 4 3,365,802 2,744,322 Grade 12: Watch list - - Carrying amount 347,510 317,6 8 4 3,365,802 2,744,322 Total carrying amount 332,781 298,949 3,365,802 2,744,322

1.3.20 Credit Risk - Credit Quality continued Analysis by credit grade of loans and advances Exposure to Credit Risk All amounts in thousands of Gambian Dalasi unless otherwise stated 31 December 2019 Loans and advances to customers Investment securities 31-Dec-2019 31-Dec-2018 31-Dec-2019 31-Dec-2018 IFRS Classification Carrying amount 332,781 298,949 3,365,802 2,744,322

Past due but not impaired Past due comprises: 30-60 days - - - - 60-90 days - - - - 90-180 days - - - - 180-360 days + - - - - Neither past due nor impaired

Standard Chartered Bank Gambia Limited 86 Annual Report 2019 Grade 1-3: Normal 347,510 317,6 8 4 3,365,802 2,744,322 Strategic report Grade 4-5: Watch list - - - - Carrying amount 347,510 317,6 8 4 3,365,802 2,744,322 Includes loans with re-negotiated terms Gross amount 347,510 317,6 8 4 3,365,802 2,744,322 Allowance for impairment (14,729) (18,735) - - Carrying amount 332,781 298,949 3,365,802 2,744,322

Maturity profile – On balance sheet

All amounts in thousands of Gambian Dalasi unless otherwise stated Corporate governance Up to 1 1 - 3 4 - 6 7 - 12 Over 5 Gross 31-Dec-2019 month months months months 1 - 5 years years nominal Net nominal Liabilities Customer deposits 1,686,090 313,545 74,769 2,315,092 - - 4,389,495 4,377,265 Due to other banks 48,011 - - - - - 48,011 48,011 Other liabilities 9,177 470,655 - 256,983 7,569 - 744,384 588,124 1,743,277 784,200 74,769 2,572,075 7,569 - 5,181,890 5,013,400

Assets: FINANCIAL STATEMENTS Cash and balances with central bank 2,160,501 - - - - - 2,160,501 1,419,499 Treasury bills and other eligible bills 702,727 245,920 674,815 1,742,340 - - 3,365,802 3,365,802 Due from other banks 944,702 - - - - - 944,702 937,672 Loans and advances to customers 39,451 40,366 20,831 196,672 37,493 - 334,813 332,781 Account

receivables 107,457 - 175,602 - - - 283,059 282,973 informationSupplementary 3,954,837 286,286 871,249 1,939,012 37,493 - 7,088,876 6,338,727 Net assets/ (exposures) (1,203,214) 185,111 756,639 1,617,468 37,493 - 1,393,496 643,343

Maturity profile – On balance sheet Up to 1 1 - 3 4 - 6 7 - 12 Over 5 Gross 31-Dec -2018 month months months months 1 - 5 years years nominal Net nominal Liabilities Customer deposits 1,686,089 313,545 74,769 2,315,092 - - 4,389,495 4,377, 26 5 Due to other banks 48,011 - - - - - 48,011 48,011 Other liabilities 9,177 470,655 - 256,983 7,569 - 744,384 588,124 1,743,277 784,200 74,769 2,572,075 7,569 - 5,181,890 5,013,400

Assets: Cash and balances with central bank 373,080 - - - - - 373,080 1,441,082 Treasury bills and other eligible bills 349,507 297,8 67 613,357 1,512,746 - - 2,773,477 2,744,322 Due from other banks - 844,210 - - - - 844,210 822,320 Loans and advances to customers 29,322 (58,464) ( 7,0 3 0) 15,023 316,819 - 295,670 298,949 Account receivables 171,739 29,478 - - - - 201,217 167,6 61 923,648 1,113,091 606,327 1,527,76 9 316,819 - 4,487,654 5,474,334 Net assets/ (exposures) (819,629) 328,891 531,558 (1,044,306) 309,250 - (694,235) 460,934 87 Financial statements Financial risk management

Financial Risk Management continued for the year ended 31 December 2019

1.3.21 a) Financial guarantees and other financial facilities Performance Bonds and financial guarantees (Note 21b), are included in the table below based on the earliest contractual maturity date. (b) Contingent letters of credits Unfunded letters of credit (Note 21b) are also included in the table below based on the earliest contractual payment date. Up to 1 1 - 3 3 - 6 6 - 12 1 - 5 Over 5 Gross 31-Dec-2019 month months months months years years nominal Performance bonds and financial guarantees 3,000 2,552 - - - - 5,552 Contingent Letters of credits - 259,958 - - - - 259,958 Credit Related contingents ------3,000 262,510 - - - - 265,510

Up to 1 1 - 3 3 - 6 6 - 12 1 - 5 Over 5 Gross 31-Dec-2018 month months months months years years nominal Performance bonds and financial guarantees 3,000 11,927 2,094 - - - 17,021 Contingent Letters of credits 90,578 181,965 31,094 - - - 303,637 Credit Related contingents 748 - 2,275 - - - 3,023 94,326 193,892 35,463 - - - 323,681

1.3.22 Capital management The Bank’s objectives when managing capital, which a broader concept than the ‘equity’ on the face of the statement of financial position, are: a. To comply with the capital requirements set by the regulators of the banking markets where the Bank operate b. To safeguard the Bank’s ability to continue as a going concern so that it can continue to provide returns for shareholders and benefits for other stakeholders and c. To maintain a strong capital base to support the development of its business. Capital adequacy and the use of regulatory capital are monitored daily by the Bank’s management, mploying techniques based on the guidelines developed by The Central Bank of Gambia (CBG), for supervisory purposes. The required information is filed with the CBG on a monthly basis. 1.3.22 Capital management continued The CBG requires each bank to: (a) hold the minimum level of the regulatory capital of GMD200 million and (b) maintain a ratio of total regulatory capital to the risk-weighted asset at or above the minimum of 10%. The Bank’s regulatory capital as managed by its Financial Control and Asset and Liability Management Committee desk is divided into two tiers: i. Tier 1 capital: This includes permanent shareholders’ equity (issued and fully paid ordinary shares or common stock and irredeemable non-cumulative preference shares) and disclosed reserves (created or increased by appropriations of retained earnings or other surpluses). Share capital, retained earnings and statutory reserves created by appropriation from profit for the year. The Tier 1 regulatory capital is arrived at after deducting: Regulatory reserves, goodwill, treasury stock, Losses, deferred tax assets, other intangible assets and 50% of investments in unconsolidated banking and financial subsidiary companies. ii. Tier 2 capital: includes revaluation reserves, hybrid (debt/equity) capital instruments, subordinated term debts and audited Other Comprehensive Income. The Tier 2 capital is arrived at after deducting 50% of: Investments in unconsolidated banking and financial subsidiary companies, investments in capital of other banks and financial institutions and significant minority investments in other financial entities. The risk-weighted assets are measured under the Pillar 1 (minimum capital requirements) classified according to the major risks that the bank faces: Credit, Market and Operational risks associated with - each asset and counterparty, taking into account any eligible collateral or guarantees. A similar treatment is adopted for off-balance sheet

Standard Chartered Bank Gambia Limited 88 Annual Report 2019 exposures, with some adjustments to reflect the more contingent nature of the potential losses. Strategic report The regulatory minimum capital prescribed to financial institutions in The Gambia with a national banking license is 7.5% for Tier 1 and 10% for total capital. The Bank uses the standardised approach, which is a credit risk measurement technique under the Basel I capital adequacy rules. The Bank does not maintain internal capital targets but rather manages its capital levels to take into consideration regulatory minimum capital requirements, anticipated changes to those requirements, forecast organic growth and shareholder return expectations. The table below summarises the composition of regulatory capital and the ratios of the Bank for the years ended 31 December 2019 and 31 December 2018. During those two years, the Bank omplied with all of the externally imposed capital requirements to which it is subject. Corporate governance All amounts in thousands of Gambian Dalasi unless otherwise stated 31-Dec-19 31-Dec-18 Tier 1 capital Ordinary share capital 200,000 200,000 Retained earnings 157,731 88,857 Other regulatory adjustments 187,420 124,767 Total 545,150 413,625

Tier 2 capital FINANCIAL STATEMENTS Fair value reserve from non-pledged assets held for trading 2,113 4,387 Total regulatory capital 547,263 418,012 Risk - weighted assets Balances due from other banks 375,020 3 37,6 91 Other loans and bills discounted 136,126 327,46 4 Fixed and other assets 215,614 112,711 Documentary letters of credit 103,983 55,147

Other letters of credit 0 26,589 informationSupplementary Guarantees and acceptances 5,552 220,587 Total risk - weighted assets 836,295 1,080,189

Capital ratios Total regulatory capital expressed as a%age of total risk-weighted assets 65.44% 38.70%

1.3.23 Operational risk The Standard Chartered Bank’s Operational Risk Framework sets out the approach to the management of operational risk. It describes how operational risk should be managed and controlled in order to drive a consistent approach and common understanding across the Bank. It is our vision to be the best international bank in enhancing our competitiveness and commitment to customers, clients and other stakeholders with disciplined and proactive management of operational risk. The Bank’s operational risk management approach serves to continually improve it’s ability to anticipate all material risks and to increase the ability to demonstrate, with a high degree of confidence, that those material risks are well controlled. It also clarifies and reinforces the need for clear ownership and accountability for all processes around the bank, with no significant gaps or duplication. This reinforces the 3 Lines of Defence and enhances risk culture. Effective management of operational risk delivers value to all our stakeholders. In particular it delivers continuous improvement in a number of business outcomes: Reduces unexpected earnings volatility and likelihood of financial or reputational distress. Improves sustainable returns and optimises use of capital; Enhances market and regulator confidence in our management and process discipline; Improves BAU & investment resource allocation through risk-based prioritisation; Improves process reliability and service quality; Embeds a culture of ownership for continuous improvement of processes and proactive management of related risks; Improves planning informed by risk assessments and anticipation of a range of plausible scenarios; Supports sustainable business growth and competitive advantage through operational excellence and a continuous improvement culture; 89 Financial statements Financial risk management

Financial Risk Management continued for the year ended 31 December 2019

Roles and responsibilities The Bank’s Risk Management Framework (RMF) sets out the respective responsibilities of the 3 Lines of Defence. These include: First Line of Defence The First Line of defence is all employees who have any level of supervisory responsibility since they are required to ensure the effective management of operational risks within the scope of their direct organisational responsibilities. The risk management responsibilities of First Line managers are as follows:

¼¼ Ensure all material risks are identified, assessed, mitigated, monitored and reported. ¼¼ Ensure applicable external laws and regulations and internal policies, procedures, limits and other risk control requirements are implemented and complied with. ¼¼ Propose control enhancements to ensure that any known risks are controlled within acceptable boundaries and to consistent standards. ¼¼ Align business (or functional) strategy with risk appetite and seek to optimise the risk-return profile of the business. ¼¼ Set the right tone for the risk management culture of the team in internal communications and performance Managers have First Line ownership of all processes operated within their respective function or business. Unlike some other risk types, all the Bank’s activities give rise to operational risks. Therefore, all individuals who have management responsibility also necessarily have First Line responsibility for managing operational risk. Second Line of Defence The Second Line of defence for operational risk comprises the Bank’s Head of Operational Risk and other Operational Risk Control Owners, supported by their respective control functions. Risk Control Owners (RCO) are responsible for ensuring that the residual risks within the scope of their responsibilities remain within appetite. In discharging this responsibility, RCOs must:

¼¼ Challenge and verify First Line risk identification and assessments, in line with changes in the internal and external environment ¼¼ Identify and report key risks material to the Bank ¼¼ Maintain a good understanding of applicable laws and regulations ¼¼ Design, implement and maintain controls and mitigants for exposures material to the Bank ¼¼ Ensure effective communication of policies and other control requirements ¼¼ Define key control indicators and control sample testing requirements as appropriate ¼¼ Monitor compliance with and effectiveness of the risk control environment ¼¼ Monitor ‘live’ risk issues and events material to Bank and verify whether appropriate management action is being taken to mitigate their impact ¼¼ Advise governance bodies on key risks, the effectiveness of mitigants and controls, and alignment of residual risks with appetite It should be noted that these Second Line responsibilities are additional to any First Line responsibilities that the Risk Control Owner may have as a line manager. Third Line of Defence The Third Line of defence comprises the independent assurance provided by the Bank’s Internal Audit (GIA) function, which has no responsibilities for any of the activities it examines. GIA provides independent assurance of the effectiveness of management’s control of its own business activities (the First Line) and of the processes maintained by the Risk Control Functions (the Second Line). As a result, GIA provides assurance that the overall system of control effectiveness is working as required within the Risk Management Framework. The role of GIA is defined and overseen by the Board Audit Committee.

Standard Chartered Bank Gambia Limited 90 Annual Report 2019 Notes to the financial statements continued Strategic report for the year ended 31 December 2019

1.4 Segment information Segment information is presented in respect of the Bank’s business segments. The primary format, business segments, is based on the Bank’s management and internal reporting structure. Business segments pay and receive interest to and from the Central Treasury on an arm’s length basis to reflect the allocation of capital and funding costs. Corporate governance Segment capital expenditure is the total cost incurred during the year to acquire property and equipment, and intangible assets other than goodwill. The Bank presents segments performance reports to the Executive Management Committee headed by the Managing Director (MD/CEO), who is also the Chief Operating Decision Maker. Products are offered to customers in these segments based on customer size, presence and level of risk and complexities. Global Banking (GB) The GB Unit provides bespoke comprehensive banking products and services to well structured corporate

organizations to meet the needs of this segment of the Bank’s customers. It provides innovative financing and FINANCIAL STATEMENTS risk management solutions and advisory services for the Bank’s corporate and institutional customers. Retail Banking (RB) The RB segment serves the needs of individuals and smaller organisations of the Gambian market including Small and Medium sized Enterprises. ¼¼ Business clients - focusing on scalable business. ¼¼ Priority clients - Serving affluent individuals through continuous engagement on financial future. ¼¼ Personal clients - Banking the aspiring/future affluent digitally, supported by affluent pull advertising. Fully supported by global simple and standard products, digitised platforms and strong management capacity. Supplementary informationSupplementary All amounts in thousands of Gambian Dalasi unless otherwise stated 31-Dec-2019 Central Revenue Global Banking Retail Banking Unallocated Total Net interest income 49,560 108,998 118,905 277,463 Net fee and commission income 55,779 46,726 - 102,505 Other operating income 14,357 47,566 - 61,923 Total segment revenue 119,696 203,290 118,905 441,891 Segment result 119,696 203,290 118,905 441,891 Income tax expense (92,400) Profit for the year 250,611 Segment assets 966,495 45,291 - 1,011,786 Unallocated assets 5,443,787 5,443,787 Total assets 966,495 45,291 5,443,787 6,455,573 Segment liabilities 1,169,393 3,732,463 - 4,901,856 Unallocated liabilities 908,235 908,235 Total liabilities 1,169,393 3,732,463 908,235 5,810,092 Impairment gain on financial assets 11,512 Depreciation and amortisation 9,744 9,744 Capital expenditure 32,077 32,077

91 Notes to the Financial statements financial statements

Notes to the financial statements continued for the year ended 31 December 2019

All amounts in thousands of Gambian Dalasi unless otherwise stated 31-Dec-2018 Central Revenue Global Banking Retail Banking Unallocated Total Net interest income 120,631 118,454 87,999 327,0 8 4 Net fees and commission income 18,024 19,307 - 37,3 31 Other operating income 33,761 24,133 1,520 59,414 Total segment revenue 172,416 161,894 89,519 423,829 Segment result 172,416 161,894 89,519 423,829 Income tax expense (30,124) Profit for the year 115,442 Segment assets 5,540,165 170 - 5,540,335 Unallocated assets 3,055 3,055 Total assets 5,540,165 170 3,055 5,543,390 Segment liabilities 1,179,406 3,380,064 - 4,559,470 Unallocated liabilities 464,058 464,058 Total liabilities 1,179,406 3,380,064 464,058 5,023,528 Impairment gain on financial assets (6,690) Depreciation and amortisation 7,470 7,470 Capital expenditure 6,331 6,331

2. Interest and similar income: All amounts in thousands of Gambian Dalasi unless otherwise stated 31-Dec-2019 31-Dec-2018

Interest and similar income was derived from: 265,751 225,480 Treasury bills/debt securities 54,146 141,588 Loans and advances 13,243 11,893 Placements - 196 Deposits with banks 333,140 379,157

Interest income earned in The Gambia 320,462 374,142 Interest income earned outside The Gambia 12,678 5,015 333,140 379,157 Analysed as follows: Fair Value through OCI (2017: Available for sale) 265,751 225,480 Amortised cost 67,389 153,677

Total interest and similar income 333,140 379,157

3 Interest and similar expense: Current accounts - - Savings accounts 29,525 27,14 0 Time deposits 25,849 24,788 Inter-bank takings 303 145 55,677 52,073

Standard Chartered Bank Gambia Limited 92 Annual Report 2019 All amounts in thousands of Gambian Dalasi unless otherwise stated Strategic report 31-Dec-2019 31-Dec-2018 4 Fee and commission: 4a Fee and commission income Commission on turnover 15,226 14,832 Commission on off-balance sheet transactions 6,420 7,501 Remittance fee 8,727 8,564 Letters of credits commission and fee 160 409 E-transact fee 49,371 12,061 Other fee and commission 38,422 2,799 Corporate governance Other fee and commission 118,325 46,166

4b Fee and commission expense E-transact expense 15,568 8,563 Other charges & expense 252 272 15,819 8,835 Net fee and commission income 102,506 37,3 31

5 Foreign exchange and other income FINANCIAL STATEMENTS 5a Foreign exchange income 61,923 62,458 5b Foreign exchange expense - (4,564) 5c Net foreign exchange income 61,923 57,8 9 4 5d Other income - 1,520

6. Operating expenses 6a. Personnel cost (note 25a) Salaries 76,796 70,157 Allowances and bonuses 31,335 5,352

Share save cost 447 791 informationSupplementary Pension cost 10,465 9,703 Director's remuneration 1,201 774 Other Staff Cost 81,878 66,210 202,122 152,987 Other staff cost is as follows: Senior Car Scheme 37,523 26,703 Redundancy/Severance 2,045 2,266 Medical Expenses 6,846 6,232 Transportation Cost 6,338 6,009 Communication 11,447 11,509 Fringe Benefit Tax - Local Staff 3,240 5,030 Fringe Benefit Tax - Expat Staff 2,765 1,191 Training 2,575 1,113 Staff Loan Subsidy 3,174 2,454 Staff Welfare 3,751 2,006 Holiday provision 412 94 Festival and annual functions 1,762 1,604 81,878 66,210

6b. Premises costs Finance lease expense 2,028 7, 23 6 Rates and licences 1,675 570 Utilities 6,158 8,154 Premises security 3,548 1,229 Repairs and maintenance 23,304 24,190 36,712 41,380 93 Notes to the Financial statements financial statements

Notes to the financial statements continued Allfor amountsthe year ended in thousands 31 December of Gambian 2019 Dalasi unless otherwise stated 31-Dec-2019 31-Dec-2018

Leased premises assets and leased equipment assets were newly recognised on 1 January 2019 due to the adoption of IFRS 16 Leases (refer to Note 1.2). The Bank applied the modified retrospective transition approach, such that the right-of-use asset recognised equals the lease liability, adjusted for prepayments and accruals recognised under IAS 17 as of 31 December 2018 31-Dec-2019 31-Dec-2018 6c. Depreciation Premises 1,340 1,340 Vehicles 1,641 2,124 Equipment 1,803 4,006 Leased assets 4,960 - 9,744 7,470

6d. General administrative expenses AGM expenses 953 525 Auditor's remuneration 1,100 700 Communication 13,041 8,130 Courier, air freight and postage 2,163 1,034 Donation and sponsorship 6,217 - Insurance premium 236 - Legal & professional fees 13,640 666 Stationery 3,184 1,963 Travelling & conference cost 15,693 18,811 Shared centre cost 9,436 7,726 Head office expenses -Note d(i) - - Scope recharges 29,046 33,228 Regional cost - - Group business recharges - - Technology recharges - 597 Assets written off - 150 Fine and penalties - CBG - 348 Other operating expenses 25,693 9,238 120,402 83,116 Total operating expenses 368,980 284,953

d(i) Other operating expenses Transaction Processing System (TPS) Recharges - (1,884) Consultancy Fees 4,121 781 Advertising costs 4,714 968 VAT Paid 8,016 6,111 Outsource/Vendor cost 3,476 971 Other local taxes 1,300 791 Events and functions 4,066 1,500 25,693 9,238

6e. Other reversals of provisions Financial Group Cost Recharge (239,074) - Transaction Processing System (TPS) Recharges (42,537) - (281,611) -

Standard Chartered Bank Gambia Limited 94 Annual Report 2019 All amounts in thousands of Gambian Dalasi unless otherwise stated Strategic report 31-Dec-2019 31-Dec-2018 6e. (i) This is a reversal of accrued expenses relating to Financial Group Cost and Transaction Processing System (TPS) recharges totaling GMD 281.6m. The Bank has been accruing for group recharges since 2014 but could not pay for the services due to unavailability of foreign exchange. In 2019, the Bank sought dispensation from the Group and approval was granted resulting in the Group reversing recharges receivable from SCB Gambia.

31-Dec-2019 31-Dec-2018 7. Taxation 7a. Analysis of tax charged for the year

Profit/(Loss) before tax 343,011 145,566 Corporate governance Taxable expenses 36,983 19,436 Allowable deduction (16,268) (29,275) Capital allowance (3,706) ( 7,6 49) Taxable profit/(Loss) 360,020 128,078 7a. Analysis of tax charged for the year Current tax expense Current year (97,205) (34,581) Prior tax charge or release - 4,128

Deferred tax expense FINANCIAL STATEMENTS Origination and reversal of temporary differences 4,805 329 (92,400) (30,124)

7b.(i) Income tax payable 31-Dec-2019 31-Dec-2018 At 31 December 2018 67,739 37,775 Opening balance difference (42,500) - At 1 January 25,239 37,775 Tax paid (52,065) (4,617)

Income tax charge 97,205 34,581 informationSupplementary At 31 December 70,379 67,73 9

7b.(ii) Opening balance difference represented the difference between the final tax charged for 2018 and the actual amount accrued for 2018. The final tax assessment was GMD25.7 million lower than the amount accrued for of GMD67.7 million, which resulted to the tax adjustment of GMD42.5 million(opening balance difference). The Bank’s income tax charge for the year has been computed at the current rate of 27% (2018: 27%) on taxable profit for the year. 8. Cash and balances with Central Bank 31-Dec-2019 31-Dec-2018 Cash balance 633,601 373,074 Operating account with Central Bank of The Gambia 44,897 404,216 678,498 777,290 Mandatory reserve deposits with Central Bank of The Gambia 741,001 663,792 1,419,499 1,441,082

Cash reserve deposits are mandatory reserve deposits with the Central Bank of The Gambia, which are not available for use in the Bank’s day-to-day operations. 9. Financial instruments Classification: On initial recognition, a financial asset is classified and measured at: amortised cost, Fair value through other comprehensive income (FVOCI) or Fair value through profit or loss (FVTPL). Financial liabilities are initially recognised and subsequently measured at fair value in the statement of financial position with transaction costs recognised in profit or loss. All changes in fair value are recognised as part of income in profit or loss.

95 Notes to the Financial statements financial statements

3. Accounting policies continued Notes to the financial statements continued 3.8 Financial Instruments continued for the year ended 31 December 2019

9a. Financial instruments classification All amounts in thousands of Gambian Dalasi unless otherwise stated Assets Assets at fair value Assets at amortised cost Other comprehensive Designated at Loans and income fair value receivables Total 31-Dec-2019 Cash and Balances with Central Bank - 1,419,499 - 1,419,499 Non-pledged trading assets 3,365,802 - - 3,365,802 Due from other banks - 937,672 - 937,672 Loans and advances to customers - - 332,781 332,781 Other assets - - 399,820 399,820 Assets 3,365,802 2,357,171 732,601 6,455,573

31-Dec-2018 Cash and Balances with Central Bank - 1,441,082 - 1,441,082 Non-pledged trading assets 2,744,322 - - 2,744,322 Due from other banks - 822,320 - 822,320 Loans and advances to customers - - 298,949 298,949 Others - - 167,6 61 167,6 61 Assets 2,744,322 2,263,402 466,610 5,474,333 All amounts in thousands of Gambian Dalasi unless otherwise stated Liabilities Other financial liabilities 31-Dec-2019 at amortised cost Total Customer deposits 4,882,302 4,882,302 Due to other banks 304,958 304,958 Deferred tax liabilities - - Income tax payable 70,379 70,379 Other liabilities 552,451 552,451 Liabilities 5,810,090 5,810,090

All amounts in thousands of Gambian Dalasi unless otherwise stated

Liabilities Other financial liabilities at 31-Dec-2018 amortised cost Total Customer deposits 4,377, 26 5 4,377, 26 5 Due to other banks 48,011 48,011 Deferred tax liabilities 22,388 22,388 Tax payable 67,73 9 67,73 9 Other liabilities 508,124 508,124 Liabilities 5,023,527 5,023,527

9b. Valuation of financial instruments Instruments held at fair value: Valuation of financial assets and liabilities held at fair value are subject to a review independent of the business by Valuation Control. For those financial assets and liabilities whose fair value is determined by reference to externally quoted prices or marke observable pricing inputs to valuation model, an assessment is made against external market data and consensus services. Financial instruments held at fair value in the balance sheet have been classified into a valuation hierarchy that reflects the significance of the inputs used in the fair value measurements.

Standard Chartered Bank Gambia Limited 96 Annual Report 2019 Wherever possible, Valuation Control utilizes multiple independent market data sources. Market data sources are Strategic report assessed for relevance and reliability. A market data source is relevant and reliable if there is a high probability that a third party transaction can be executed based on this data. Market data reliability is assessed with respect to the following considerations:

¼¼ Methodology used by data provider to generate data (e.g. identity of contributors, basis of data collection/ processing). ¼¼ Degree of activity in the market or extent of market coverage represented by the data source. ¼¼ Integrity and reputation of the data provider. ¼¼ Comparisons with other similar or alternative data sources and whether or not it is regarded within the range of acceptable quotes (on the basis of a current and historical consideration). Corporate governance Where a range of market price sources are utilized, Valuation Control documents the process by which the average or consensus price is determined. If valuation Control chooses to adopt a pricing hierarchy (a scheme in which prices from more reliable sources are used preferentially to prices less reliable), any prices not used are reviewed for a body of contradictory evidence. Valuation Control assesses all available market data before selecting the market data sources that will form the basis of the Price Testing Process. Market data utilized by valuation control is independent of the Front Office. Market data that is not fully independent receives a zero or low weighting. Control Framework A Product Valuation Control Committee exists for each business where there is a material valuation risk. The committees meet frequently and comprise representatives from front office, Group Market Risk, Product Control

and Valuation Control. The committees are responsible for reviewing the results of the valuation control process. FINANCIAL STATEMENTS Valuation Hierarchy The valuation hierarchy, and the types of instruments classified into each level within that hierarchy, is set out below:

Level 1 Level 2 Level 3 Fair value determined using Unadjusted quoted prices in an Valuation models with direct or Valuation models using active market for identical assets indirect market observable significant non-market and liabilities inputs observable inputs Types of financial assets Actively traded government and Corporate and other Assets backed securities. agency securities. government bonds and loans. Private equity investments

Listed equities. Over-the-counter (OTC Highly structured OTC informationSupplementary derivatives. derivative contract with Listed derivative instruments unobservable parameters Assets backed securities Investment in publicly traded mutual Corporate bonds in illiquid funds with listed market prices Private equity investments markets Types of financial liabilities Listed derivative instruments OTC derivatives Highly structured OTC derivatives with unobservable parameters

9c. Valuation of Financial Instruments Level 1 portfolio Level 1 asset and liabilities are typically exchange traded positions and some government bonds traded in active markets. These positions are valued using quoted prices in active markets. Level 2 portfolio Where instruments are not quoted in an active market, the Bank utilizes a number of valuation techniques to determine fair value. These valuation techniques include discounted cash flow analysis models, option pricing models and simulation models and other standard models commonly used by market participants. Valuation techniques incorporate assumptions that other market participants would use in their valuations, such as discount rates, default rates, credit spreads and option volatilities. These inputs need to be directly or indirectly observable in order to be classified as Level 2. The Bank makes a credit valuation adjustment (CVA) against derivative products, which represents an estimate of the adjustment to fair value that reflects the possibility that the counterparty may default such that the Bank would not receive the full market value of the transactions. For these products, the Bank uses the Advanced IRB (AIRB) approach to manage its credit risk. All assets under the AIRB approach have sophisticated probability of default (PD), loss given default (LGD) and exposure at default or credit conversion factor models developed to support the credit decision making process. For CVA, AIRB models are used to calculate the PD and LGD which together with the results of the exposure simulation engine, generates a view of expected loss.

97 Notes to the Financial statements financial statements

Notes to the financial statements continued for the year ended 31 December 2019

In addition to periodic reassessment of the counterparties, credit exposures and external trends which may impact risk management outcomes are closely monitored. Accounts or portfolios are placed on Early Alert when they display signs of weakness or financial deterioration, for example where there is a decline in the customer’s position within the industry, a breach of covenants, non-performance of an obligation, or there are issues relating to ownership or management. As a result, the reserve represents a dynamic calculation based on the credit quality of the counterparties, collateral positions and exposure profiles. All fair value positions in non-derivative financial instruments are valued at bid (for long positions) or offer (short) levels. Fair value of derivative positions is initially derived by calculating at mid-market levels. These are then adjusted through bid-offer valuation adjustments to effectively reflect the long positions at bid and short positions at offer. The resulting valuation is then reflective of the fair value of that instrument in the market. In calculating the bid-offer valuation adjustment, reference is usually made to the risk contained within a similar bucket, for example the interest rate risk is divided in time buckets and a separate bid-offer valuation adjustment calculated for each one of these. The rationale for following this methodology is to take account of the different risks that exist for each of the time buckets and the different hedge transactions that would need to be executed to insulate the gross risk in those buckets, should the need arise. Similar bucketing also takes place to account for different bid-offer levels for options which are at the money, out of the money and in the money. Level 3 portfolio The primary products classified as Level 3 are as follows: Investment Securities – asset backed securities The majority of these positions are valued using third party sources. However, due to the severe lack of liquidity in the market and the prolonged period of time under which many securities have not traded, obtaining external prices is not a strong enough measure to determine whether an asset has an observable price or not. Therefore, once external pricing has been verified, the portfolio asset classes are monitored against market conditions using broker reports in order to establish which asset classes are seeing some levels of activity and which are completely illiquid. The latter are classified as Level 3. Where third party pricing is not available, Standard Chartered dealer prices are used with the asset classified as Level 3. 9d. Equity Shares – Private Equity Unlisted Private Equity investments are generally valued based on earnings multiples (Price-to-earnings (P/E) or Enterprise Value (EV) or earnings before income tax, depreciation and amortization (EBITDA)) of comparable listed companies together with the application of a liquidity discount. The two primary inputs for the valuation of these investments are the actual or forecast earnings of the investee companies and earnings multiples of the comparable listed companies. Valuation of Financial Instruments Even though earnings multiples for the comparable listed companies can be sourced from third party sources (for example, Bloomberg) and those inputs can be deemed Level 2 inputs, all unlisted investments (excluding those where some form of observable inputs are available, for example OTC prices) are classified as Level 3 on the grounds that the valuation methods involve significant judgments ranging from determining comparable companies to liquidity discounts. 9e. Derivatives These trading derivatives are classified as Level 3 if there are parameters which are unobservable in the market, such as products where the performance is linked to more than one underlying. Examples are foreign exchange basket options, equity options based on the performance of two or more underlying indices and interest rate products with quanto pay-outs. These unobservable correlation parameters could only be implied from the market, through methods such as historical analysis and comparison to historical levels or benchmark data. Other derivatives are classified as Level 3 if the trading is illiquid, such as some emerging market convertible bonds and structured credit products.

Standard Chartered Bank Gambia Limited 98 Annual Report 2019 The table below shows the classification of financial instruments held at fair value into the valuation hierarchy set out Strategic report above as at 31 December, 2019. All amounts in thousands of Gambian Dalasi unless otherwise stated 31-Dec-2019 Level 1 Level 2 Level 3 Total Assets Financial assets held for trading - - - - Financial assets – non-pledged assets held for trading

Treasury bills 3,265,186 - - 3,265,186 Corporate governance Debt securities 100,616 - - 100,616 Derivative instruments - - - - Assets 3,365,802 - - 3,365,802

Liabilities Derivative instruments - - - -

31-Dec-2018 Assets

Financial assets held for trading - - - - FINANCIAL STATEMENTS Treasury bills 2,744,322 - - 2,744,322 Debt securities - - - - Derivative instruments - - - - Assets 2,744,322 - - 2,744,322

Liabilities Derivative instruments - - - - 10. Due from other banks

All amounts in thousands of Gambian Dalasi unless otherwise stated informationSupplementary 31-Dec-2019 31-Dec-2018 Current Balances with Banks in The Gambia 113 86 Current Balances with Banks outside The Gambia (Non SCB Banks) 2,106 928 Placements with banks (SCB Bank) 935,453 821,306 937,672 822,320

11. Loans and advances to customer

31-Dec-2019 31-Dec-2018 Overdraft 34,756 5,077 Term Loans of which: Less than 1 year 161,855 42,048 Beyond 1 year 150,899 270,559 347,510 317,6 8 4 Individual loan impairment - - Expected credit loss (14,729) (18,735) 332,781 298,949

99 Notes to the Financial statements financial statements

Notes to the financial statements continued for the year ended 31 December 2019 11. Loan impairment 11a. Movement in loan impairment 31-Dec-2019 31-Dec-2018 Opening balances 18,735 8,069 Write back of provision for credit losses (15,518) (3,849) Transitional impairment - 21,205 At 1 January 3,217 25,425 Released during the year - (6,690) Charge during the year 11,512 - Loans written-off in the year - - At 31 December 14,729 18,735 Analysis of loans by performance Performing 347,510 317,6 8 4 Non - performing - - Gross loans 347,510 317,6 8 4 NPL ratio 0.00% 0.00%

11b Analysis of loan impairment All amounts in thousands of Gambian Dalasi unless otherwise stated Expected credit loss 31-Dec-2019 31-Dec-2018 At 1 January 18,735 25,425 Released during the year - (6,690) Write back of provision for credit losses (15,518) - Charge during the year 11,512 - Loans written-off in the year - - At 31 December 14,729 18,735

31-Dec-2019 Stage 1 Stage 2 Stage 3 Total At 1 January - - - - Impairment during the year 7,684 3,829 - 11,512 Released during the year - - - - Loans written-off in the year - - - - At 31 December 7,684 3,829 - 11,512

31-Dec-2018 Stage 1 Stage 2 Stage 3 Total At 1 January - - - - Impairment during the year - - - - Released during the year (6,690) - - (6,690) Loans written-off in the year - - - - At 31 December (6,690) - - (6,690)

Standard Chartered Bank Gambia Limited 100 Annual Report 2019 11c Analysis of impairment charge for the year Strategic report All amounts in thousands of Gambian Dalasi unless otherwise stated 31-Dec-2019 31-Dec-2018 Impairment during the year 11,512 - Releases during the year - (6,690) Recoveries on loans previously written-off - - Direct write-off - - 11,512 (6,690) The maturity profile of the loans and advances is as follows:

Analysis by Maturity Corporate governance 31-Dec-2019 31-Dec-2018 0 - 30 days 39,451 7,810 1 - 3 months 40,366 30,123 4 - 6 months 20,831 9,192 7 - 12 months 196,672 - Over 12 months 50,190 270,559 347,510 317,6 8 4

12. Other Assets FINANCIAL STATEMENTS 31-Dec-2019 31-Dec-2018 Prepaid medical and insurance 5,729 6,574 Lease holding account 17,432 22,903 Accrued interest receivables 33,285 29,102 Accounts receivables 226,526 109,081 282,973 167,6 61 Analysis by Maturity: Amount falling due less than 1 year (note 13) 282,973 165,929 Supplementary informationSupplementary Amount falling due after one year - 1,732 282,973 167,6 61

13. Account receivables comprise: All amounts in thousands of Gambian Dalasi unless otherwise stated 31-Dec-2019 31-Dec-2018 Others - SCB Group Companies 38,414 4,452 Other assets – Acceptance 175,602 86,703 Prepaid medical and insurance 5,729 6,574 Lease holding account 17,432 22,903 Cross border receivable 9,249 13,639 AIR-Corporate term loan 33,285 29,102 Card settlement 3,261 2,555 282,973 165,929

101 Notes to the Financial statements financial statements

Notes to the financial statements continued for the year ended 31 December 2019

14. Property, plant & equipment

Freehold Leasehold Computer land and land and Motor Furniture and office Work-in buildings buildings vehicles and fittings equipment progress Total Cost 1 January 2019 79,981 - 26,946 9,196 62,607 5,731 184,461 Additions - - - - - 32,077 32,077 Right-of-use assets - 16,857 - - - - 16,857 Retirement - - (13,868) (8,306) (52,692) - (74,866) 31 December 2019 79,981 16,857 13,078 890 9,915 37,808 158,529 Accumulated depreciation 1 January 2019 23,628 - 24,024 8,592 59,157 - 115,401 Charge for the year 1,340 4,960 1,641 197 1,606 - 9,744 Reclassification - - 65 151 (216) - - Retirement - - (13,868) (8,306) (52,692) - (74,866) 31 December 2019 24,968 4,960 11,862 634 7,855 - 50,279

Carrying amount 31 December 2019 55,013 11,897 1,216 256 2,060 37,808 108,250 31 December 2018 56,353 - 2,922 604 3,450 5,731 69,060

15. Customer deposits Analysis by maturity 31-Dec-2019 31-Dec-2018 Savings 2,408,988 2,049,282 Current 1,987,884 1,800,337 Time 485,431 527,6 46 4,882,302 4,377, 26 5 Analysis by maturity 0 - 30 days 1,875,386 1,681,392 1 - 3 months 357,502 320,521 4 - 6 months 78,785 70,636 7 - 12 months 2,570,628 2,304,716 4,882,302 4,377, 26 5

16. Due to other banks 31-Dec-2019 31-Dec-2018 Current balances with banks 183,384 47,9 50 Takings from SCB Group Companies 121,574 61 304,958 48,011 Analysis by Maturity Amount falling due less than 1 year 150,000 - Amount falling due after one year 154,958 48,011 304,958 48,011

Standard Chartered Bank Gambia Limited 102 Annual Report 2019 17. Other liabilities Strategic report 31-Dec-2019 31-Dec-2018 Accounts payable - note 17(i) 316,509 169,496 Share based payments 9,528 4,855 Others - SCB Group Companies 226,430 333,773 552,466 508,124 Analysis by Maturity Amount falling due less than 1 year 542,939 503,269 Amount falling due after one year 9,528 4,855 Corporate governance 552,466 508,124 i) Accounts payable (note 17i) comprises of: Cashier's order payable 1,916 1,181 Unclaimed items 22,487 25,651 Tax collection a/c 913 7,569 Accrued expenses 285,676 130,489 Provision for redundancy/severance pay 3,728 2,326 Provision for cash awards 620 445 GST/VAT and other taxes payable 913 1,702 FINANCIAL STATEMENTS Operational loss provisions 177 102 Mark-to-market liability 78 31 316,509 169,496 ii) Share based payments The Bank’s employees participate in the share compensation plans for the acquisition of shares in the ultimate holding company, Standard Chartered Plc. The market value of shares is denominated in Pounds Sterling at the time of grant. 18. Deferred Taxes Opening Opening deferred tax Recognised Recognised Closing Supplementary informationSupplementary balance adjustment in profit or loss in equity balance 31-Dec-2019 Property and equipment (12,174) 71 (2,390) - (14,493) Revaluation of premises - (14,528) - - (14,528) Provision for credit losses - 1,721 3,178 - 4,899 Other provisions - 1,174 1,809 - 2,983 FVOCI on non-pledged trading assets (10,214) 37,742 2,208 - 29,736 (22,388) 26,180 4,805 - 8,597

31-Dec-2018 Property and equipment, and software (12,503) - 329 - (12,174) Available-for-sale securities (14,172) - - 3,958 (10,214) (26,675) - 329 3,958 (22,388)

19. Share capital and reserves Authorised (issued and fully paid) Ordinary share capital 31-Dec-2019 31-Dec-2018 200,000,000 ordinary shares of D1 each 200,000 200,000 200,000 200,000

103 Notes to the Financial statements financial statements

Notes to the financial statements continued for the year ended 31 December 2019

(i) Regulatory Reserve Provisions for loans recognized in the profit and loss account are determined based on the requirements of IFRS. However, the IFRS provisions should be compared with provisions determined under prudential guidelines and the expected impact/changes in general reserve should be treated as follows:

¼¼ where prudential provisions is greater than IFRS provisions; transfer the difference from the general reserve to a non-distributable regulatory reserve. (i) Regulatory Reserve continued

¼¼ where prudential provisions is less than IFRS provisions; the excess charges resulting should be transferred from the regulatory reserve account to the general reserve to the extent of the non-distributable reserve previously recognised. Statement of Prudential Adjustments All amounts in thousands of Gambian Dalasi unless otherwise stated 31-Dec-2019 31-Dec-2018 Provision per prudential guideline (8,037) 6,347 Loan impairment per IFRS (Note 11) 11,512 (6,690) Regulatory reserve (PG) 3,475 (343)

Performing 347,510 317,6 8 4 Non-Performing - - Gross loans (Note 11) 347,510 317,6 8 4 NPL ratio 0.00% 0.00%

(ii) Fair value equity reserves The available-for-sale equity reserve represents the unrealised fair value gains and losses in respect of financial assets classified as available-for-sale, net of tax. Gains and losses are deferred in this reserve until such time that the underlying asset is sold, matures or becomes impaired. Below is an analysis of AFS reserves Into different securities.

All amounts in thousands of Gambian Dalasi unless otherwise stated 31-Dec-2019 31-Dec-2018 Fair value analysis by securities Treasury bills 51,466 47,079 51,466 47,079 Net gain/(loss) on fair value 2,113 4,387 Fair value reserves net of tax 53,579 51,466

19a. Retained earnings adjustments

All amounts in thousands of Gambian Dalasi unless otherwise stated Prior years’ retained earning adjustments represented audit adjustments that were passed on the face of the annual financial statements and not posted in the general ledger. This led to the cummulative difference of GMD45.0 million between the opening retained earnings on the annual financial statements and the general ledger. The difference is now adjusted on the annual financial statements to reflect the general ledger. The adjustments are as follows:

2011 audit adjustments 16,327 2012 audit adjustments (7,465) 2013 audit adjustments (40,092) 2014 audit adjustments 9,540 2015 audit adjustments 17,819

Standard Chartered Bank Gambia Limited 104 Annual Report 2019 Strategic report

2016 audit adjustments (49,178) 2017 audit adjustments (9,836) 2018 audit adjustments 17,877 (45,009)

20 Contingent liabilities, commitments and arrangements 21a. Legal proceedings Corporate governance The Bank in the ordinary course of business has no litigation suit for claims as at 31st December 2019 (2018: GMD Nil). The Bank is however presently involved in one litigation suit for claims amounting to GMD12.6 million for which adequate provisions have been made. The Directors are of the opinion that the aforementioned case is not likely to have a material adverse effect on the Bank. 21b. Contingent liabilities and commitments In the normal course of business, the Bank is a party to financial instruments with off-balance sheet risk. The instruments are used to meet the credit and other financial requirements of customers. The contractual amounts of the off-balance sheet financial instruments at 31 December 2019 are shown below: All amounts in thousands of Gambian Dalasi unless otherwise stated FINANCIAL STATEMENTS 31-Dec-2019 31-Dec-2018 Contingent liabilities Irrevocable letters of credit 259,958 220,587 Performance bonds and guarantees 5,552 35,452 265,510 256,039 Commitments Documentary credits and short term trade-related transactions - 137,8 67 265,510 393,906 Supplementary informationSupplementary 21c. Contingent liabilities Where the Bank undertakes to make a payment on behalf of its customers for guarantees issued such as for performance bonds or as irrevocable letters of credit as part of the Bank’s business transactions for which an obligation to make a payment has not arisen at the reporting date, those are included in these financial statements as contingent liabilities. 21d. Commitments Where the Bank has confirmed its intention to provide funds to a customer or on behalf of a customer in the form of loans, overdrafts, future guarantees whether cancellable or not or letters of credit and the Bank has not made payments at the balance sheet date, those instruments are included in these financial statements as commitments. 22 Compliance with banking regulations The Bank largely complied with all banking regulations and provisions during the year and there were no penalties or charges instituted by the regulator or any other government agencies during the year. 23 Events after the reporting date There were no events after the reporting date which could have a material effect on the financial position of the Bank as at 31 December 2019 (2018: Nil) and the financial performance for the year ended on that date that have not been adequately provided for, or disclosed in these financial statements. However, the directors are carrying out an assessment of the impact of COVID-19 Pandemic on the performance and operations of the Bank and do believe that the outcome might impact the financial year 2020 assets, liabiliities, revenue and cost.

105 Notes to the Financial statements financial statements

Notes to the financial statements continued for the year ended 31 December 2019

24 Related Party transactions A number of banking transactions are entered into with related parties in the normal course of business. These include loans, deposits and foreign currency transactions. The volumes of related party transactions, outstanding balances at the year-end and related expense and income for the year are as follows: 24a Risk assets outstanding as at 31 December 2019 Direct credit assets There were no loans and advances to directors in 2019 (2018:Nil). Inter-bank placement Included in due from other banks is an amount of GMD935.45 million (2018: GMD822.32 million) representing placements with other Standard Chartered Bank (SCB) group companies. The balances as at 31 December 2019 are as follows: All amounts in thousands of Gambian Dalasi unless otherwise stated The balances as at 31 December 2019 are as follows: Name of company Relationship transaction type Amount Status Security SCB (London) Affiliate Placement 71,048 Performing Unsecured SCB (New York) Affiliate Placement 864,405 Performing Unsecured Non-group entities Non-affiliate placement 2,219 Performing Unsecured 937,672

The balances as at 31 December 2018 are as follows: Name of company Relationship transaction type Amount Status Security SCB (London) Affiliate Placement 710,689 Performing Unsecured SCB (New York) Affiliate Placement 111,631 Performing Unsecured 822,320 Included in due to other banks is an amount of GMD 154.94 million (2018: GMD 61,000) which represents the outstanding balance on deposits made by Standard Chartered Bank (SCB) group companies. In addition, the Bank borrowed an overnight amount GMD150.01 million (2018: Nil) from the overnight lending market. 24b Takings from SCB group companies

31-Dec-2019 Name of company Relationship transaction type Amount Status Security SCB (London) Affiliate takings 154,604 Performing Unsecured SCB (Japan) Affiliate takings 24 Performing Unsecured 31-Dec-2019 Name of company Relationship transaction type Amount Status Security SCB (South Africa) Affiliate takings 267 Performing Unsecured SCB (New York) Affiliate takings 48 Performing Unsecured Non-group entities Non-affiliate takings 150,016 Performing Unsecured 304,958 31-Dec-2018

Standard Chartered Bank Gambia Limited 106 Annual Report 2019 SCB (London) Affiliate takings 40 Performing Unsecured Strategic report SCB (New York) Affiliate takings 21 Performing Unsecured 61

24c Employees and directors Employees The average number of persons employed by the Bank during the year was as follows: All amounts in thousands of Gambian Dalasi unless otherwise stated Corporate governance 31-Dec-2019 31-Dec-2018 Number Number Executive Directors 1 1 Management 43 43 Non-Management 107 106 151 150

Compensation for the above staff (including Executive Director)

24d Staff cost 31-Dec-2019 31-Dec-2018 FINANCIAL STATEMENTS Salaries & wages 76,796 70,157 Allowances & bonuses 31,335 5,352 Staff medicals 6,846 6,232 Fringe benefit tax 6,005 6,221 Senior staff car scheme 37,523 26,703 Share save cost 447 791 Pension cost 10,465 9,703 Directors remuneration 1,201 774 Redundancy/Severance 2,045 2,266 Supplementary informationSupplementary Transportation Cost 6,338 6,009 Communication 11,447 11,509 Training 2,575 1,113 Staff Loan Subsidy 3,174 2,454 Staf Welfare 3,751 2,006 Holiday provision 412 94 Festival and annual functions 1,762 1,604 202,122 152,987

24e Executive Director Remuneration paid to the Bank’s Executive director was as follows:

31-Dec-2019 31-Dec-2018 Salaries & wages 14,549 11,288 Allowances & bonuses 11,150 7,874 Pension cost and social security cost 150 424 25,849 19,586

24f Loans to Directors The Bank did not enter into any transactions with its directors and their associates for the year ended 31st December 2019.

107 Notes to the Financial statements financial statements

Notes to the financial statements continued for the year ended 31 December 2019

24g Technical and Management fees

31-Dec-2019 31-Dec-2018 Africa & Middle East regional expenses - - Head office admin expenses - - Market Data Services (Financial Markets) expenses - - - -

The Bank has three agreements with its parent company. There were no charges made in 2019 (2018: Nil). All the transactions with the related parties were carried out at arm’s length. 25 Basic/diluted earnings/(loss) per share Basic earnings/(loss) per share (EPS or LPS) iscalculated by dividing the net profit attributable to ordinary shareholders by the weighted average number of ordinary shares in issue during the year as follows:

All amounts in thousands of Gambian Dalasi unless otherwise stated 31-Dec-2019 31-Dec-2018 Net profit/(loss) attributable to shareholders 250,611 115,442 250,611 115,442

Number of ordinary shares in issue as at year end 200,000 200,000

Earnings/(loss) per share - basic & diluted 1.25 0.58

Diluted earnings per share provides a measure of the interest of each ordinary share in the performance of an entity while giving effect to all dilutive potential ordinary shares outstanding during the year. There is no potential ordinary share of the Bank outstanding during the year ended 31 December 2019 and the comparative year, consequently, diluted and basic earnings per share are the same. 26 Cash and cash equivalents

31-Dec-2019 31-Dec-2018 Cash and balances with Central Bank (note 8) 1,419,499 1,441,082 Mandatory reserve deposits with Central Bank of The Gambia (741,001) (663,792)

Cash and balances with Central Bank excluding Mandatory Reserves 678,498 777,290 Due from other banks (note 10) 937,672 822,320 Cash and cash equivalents 1,616,170 1,599,610

Standard Chartered Bank Gambia Limited 108 Annual Report 2019 Strategic report report Corporate governance governance FINANCIALFinancial statements STATEMENTS

We understand our business and

will continue to focus on the informationSupplementary SUPPLEMENTARY INFORMATION fundamentals of banking to SUPPLEMENTARY INFORMATION assure the future for our clients and business. 110 Value added statement 113 Five year summary

109 Supplementary information Value Added Statement

Appendix I: Value Added Statement for the year ended 31 December 2019

All amounts in thousands of Gambian Dalasi unless otherwise stated 31-Dec-2019 31-Dec-2018 Interest earned and other operating income 513,389 483,217 Direct cost of services (71,497) (59,388) Value added by banking services 441,892 423,829 Non-banking income - - Recoveries (11,512) 6,690 Value added 430,380 430,519

Distributed as follows:

Employees Directors (without executives) 1,201 1,296 Executive director 25,849 19,586 Other employees 176,273 132,106

Other operating costs Premises cost 36,712 41,380 General and administrative cost 120,402 83,115

Reserves FVOCI reserve 2,113 4,387 Credit risk reserve (8,037) 6,347

Government Income tax 92,400 30,124

Expansion and growth Depreciation 9,744 7,470 Total 456,657 325,811 Income surplus -26,277 104,708

Standard Chartered Bank Gambia Limited 110 Annual Report 2019 Appendix II: Strategic report Top 20 Shareholders for the year ended 31 December 2019

All amounts in thousands of Gambian Dalasi unless otherwise stated 31-Dec-2019 31-Dec-2018 Standard Chartered Holding (Africa BV) 74.85% 74.85%

Social Security and Housing Finance Corporation 16.48% 16.48% Corporate governance Sir Dawda Kairaba Jawara, G.C.R.G,G.C.M.G. 1.52% 1.52% Great Alliance Insurance Company LTD 0.49% 0.49% Mr. Momodou Bun Abdoulie Senghore 0.32% 0.32% Melville CecilL Wyse 0.20% 0.20% Mrs. Awa Senghore 0.17% 0.17% Solabomi Mahoney 0.13% 0.13% Mrs. Valerie Joyce George (Deceased) 0.13% 0.13% Boto M K Manjang 0.12% 0.12% Mrs. Marion A Lloyd-Evans 0.11% 0.11% Financial statements Mr. Baboucar Sagnia ( Inre Alieu Sagnia) 0.11% 0.11% Mr. Baboucar Sagnia ( Inre Yassin Sagnia) 0.11% 0.11% Mr. Akiwume K Davies 0.11% 0.11% Mr. Abou B Denton ( Deceased) 0.10% 0.10% Linu Rajwani 0.10% 0.10% Bishop Of Gambia and The Riopongas 0.10% 0.10% Mr. Alhagy Abdoulie Sulayman Mboob (Deceased) 0.10% 0.10% Mr. Alhaji Daba Cora, Deceased Exor(s): Alaji, Amadou, Momodou Cora 0.10% 0.10% Davidson Kenneth Forster 0.10% 0.10% SUPPLEMENTARY INFORMATION

111 Supplementary Notes to the Financialinformation statements financialCorrespondent statements Banks

Appendix III: Correspondent Banks for the year ended 31 December 2019

Standard Chartered Bank London PLC 1 Basinghall Avenue London, EC2V 5DD

Standard Chartered Bank Tokyo Sanno Park Tower Floor 21 201101 Nagata-Cho Chiyoda-Ku Tokyo 100-6155

Standard Chartered Bank New York 1 Madison Avenue, New York, NY10010 – 3603

Credit Suisse AG 8 Paradeplatz, 8070 Zurich

Standard Chartered Bank Frankfurt Franklinstrasse 46-48 60486 Frankfurt Germany Royal Bank of Canada

Payment Centre – Toronto 180 Wellington Street West Toronto M5J 1J1

Svenska Handelsbanken Blasienholmstorg 11, 106 70 Stockholm

Lloyds Bank PLC U.K. International Services London

Nordea Bank Denmark Strandgade 3, 0900 Copenhagen

Standard Chartered Bank Gambia Limited 112 Annual Report 2019 STRATEGICStrategic report REPORT Corporate governance Financial statements SupplementarySUPPLEMENTARY information INFORMATION 113 5 32b 32b 2015 12,982 63,078 22,682 86,854 48,000 48,000 712,179 212,154 174,204 103,015 139,768 574,202 (39,937) 192,059 431,999 431,999 562,255 562,255 200,000 200,000 4,144,701 4,144,701 4,144,701 4,144,701 2,469,441 3,072,825 5 32b 32b 2016 11,168 71,505 32,023 79,994 45,453 45,453 48,000 48,000 587,374 (42,801) 252,618 114,306 622,816 165,378 705,556 705,556 494,368 443,400 200,000 200,000 4,474,994 4,474,994 4,474,994 4,474,994 2,4 57,8 50 3,439,364 3,439,364 5 - -19b -19b 2017 ( 7,975) 37,775 26,675 73,378 70,049 (30,174) (38,149) 207,677 207,677 616,912 616,912 451,288 522,477 531,595 531,595 138,869 200,000 200,000 1,002,779 3,815,981 2,792,936 4,978,398 4,978,398 4,978,398 4,978,398 5 58b 58b 2018 67,739 48,011 69,060 80,000 22,388 167,661 115,442 508,124 (30,124) 319,866 483,217 145,566 145,566 298,949 822,320 200,000 200,000 1,441,082 4,377,265 2,744,322 5,543,392 5,543,393 5,543,393 4 - - 2019 125b 125b 70,379 937,672 250,611 250,611 343,011 291,570 513,389 332,781 445,467 108,250 304,958 552,466 200,000 200,000 (92,400) 1,419,499 1,419,499 6,455,573 6,455,573 3,365,802 4,882,302

Assets Cash and balances with Central Bank Financial assets - AFS Due from Other Banks Loans and Advances Customers to

AppendixIV:

for the year ended 31 December 2019 December 31 ended year the for Five year financial year Five summary Other Assets Property, Plant and Equipment and Plant Property, Financed by: Financed deposits Customer Ordinary capital share Taxation payableTaxation Due other to banks Reserves Deferred tax liabilities Profit/(Loss) before tax Other liabilities statementIncome earningsGross Income tax expense Profit/(Loss) after tax dividend Proposed Earnings/(Loss) per share (basic) share per Earnings/(Loss) Earnings/(Loss) per share (diluted) share per Earnings/(Loss) offices business of Number Supplementary Statement of financial information position

Appendix V: Statement of Financial Position for the year ended 31 December 2019

31 Dec 2019 31 Dec 2018 Assets Cash and balances with Central Bank 1,419,499 1,441,082 Financial assets - AFS 3,365,802 2,744,322 Due from other banks 937,672 822,320 Loans and advances to customers 332,781 298,949 Other assets 291,570 167,6 61 Property, plant and equipment 108,250 69,060 Total assets 6,455,573 5,543,394

Liabilities Customer deposits 4,882,302 4,377, 26 5 Due to other banks 304,958 48,011 Deferred tax liabilities - 22,388 Tax payable 70,379 67,73 9 Other Liabilities 552,466 508,124 Total liabilities 5,810,106 5,023,527

Equity Ordinary share capital 200,000 200,000 Retained earnings 157,731 88,857 Statutory reserves 187,420 124,767 Other Reserves 100,317 106,241 Total equity 645,467 519,865 Total equity and liabilities 6,455,573 5,543,393

Income Statement For the year ended 31 December 2019 31 Dec 2019 31 Dec 2018

Gross earnings 513,389 483,217

Profit/(loss) before tax 343,011 145,566

The financial statements were approved and authorised for issue by the directors on 19th June, 2019.

Mr. Alpha Amadou Barry Mr. Olukorede Adenowo Chairman Chief Executive Officer

Standard Chartered Bank Gambia Limited 114 Annual Report 2019 STRATEGIC REPORT Corporate governance Financial statements Supplementary information 115 Notes to the Financial statements financial statements

The Company Secretary Standard Chartered Bank Gambia Limited 8 ECOWAS Avenue P.O.Box 259 Banjul, The Gambia

Standard Chartered Bank Gambia Limited 116 Annual Report 2019 STRATEGIC REPORT Corporate governance Financial statements Supplementary information 117 ere for good ere MONTH/YEAR END UNTIL VALID FROM ٤٥٥٤ MONTH/YEAR END UNTIL VALID FROM ٤٥٥٤ sc.com/gm Terms and Conditions apply Terms Standard Chartered Visa Debit Card. Chartered Standard C Shop safe, Pay safe online with your C Travel worldwide with ease, with your Standard Chartered Visa Debit Card.

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Terms and Conditions apply STRATEGIC REPORT Corporate governance Financial statements Supplementary information 119 Notes to the Financial statements financial statements

Standard Chartered Bank Gambia Limited 120 Annual Report 2019