Standard Chartered’s 46.7 per cent jump in net earnings to Kes6.3 billion in the nine months to September came with a pinch on savers’ deposits.

The lender posted increased profitability from Kes4.3 billion on increased foreign exchange income, and lower staff costs as well as interest on deposits.

StanChart’s interest expense on customer deposit, however, dropped 27.2 per cent to Kes2.4 billion from Kes3.3 billion, signaling lower returns to savers.

Interest rates offered to savers have fallen to 2.5 per cent this year, the lowest since August 2016 as banks aim at reducing costs to boost profitability.

The rates have specially plummeted since Parliament removed the floor on interest rates for time deposits, equal to 70 percent of the "reference rate."

Lower returns have discouraged savings in the country which has hit the lowest level since 2002 at the end of the tenuous 24 years under President Daniel Moi where the country’s savings rate dropped to 8.5 per cent of the GDP.

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Savings then rose to 16.6 per cent in 2007 during President Mwai Kibaki’s tenure, the highest it has hit over the last ten years before gradually declining.

Kenyans’ savings rate declined to an all-time low of 7.9 per cent of the gross domestic product at the end of 2019.

Gross national savings stood at Kes776.1 billion in 2019, a sharp decline from Kes907.4 billion in 2018.

StanChart also made money off foreign currency trading which jumped 33.8 per cent to Kes2.53 billion, helping shore up the non-interest income.

StanChart's staff costs went down 10 per cent from Kes5.4 billion to Kes4.8 billion signaling the one off cost of staff lay off last year was not repeated.

Last year the lender spent Kes1.35 billion to lay off 200 staff amid decade-low profits in coronavirus environment that increased loan defaults in the banking sector.

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