Standard Bank IT bill tops R14-billion as software spending shifts

Standard Bank Group’s annual financial results, published on Thursday, have revealed that Africa’s largest bank by assets spent more than R14-billion on cloud, software and technology in 2025 — an 8.7% year-on-year increase that far outpaced the growth in its overall cost base.

The “cloud, software and technology” line item in the group’s operating expenses rose to R14.1-billion from R13-billion a year earlier, even as total operating expenses grew a more modest 4.7% to R99.7-billion. Technology now accounts for roughly 14% of the group’s total operating expenditure, underscoring the extent to which banking has become a technology business.

The figures were disclosed as part of a strong set of results for the Johannesburg-headquartered group: headline earnings climbed 11% to R49.2-billion, return on equity improved to 19.3% from 18.5% and total assets swelled to R3.6-trillion. Total dividends declared for the year rose 12% to R16.95/share.

But while the group is clearly in good financial health, the technology spending patterns buried in the annual financial statements point to a potentially significant shift in how Standard Bank is deploying its IT resources.

Capital expenditure on intangible assets — predominantly internally developed software — fell 28% to R737-million from R1.02-billion in the prior year. Software additions dropped to R914-million from R1.37-billion, and work in progress on software projects dipped to R2.33-billion from R2.55-billion.

At the same time, the recurring cloud, software and technology expense line surged by more than R1.1-billion. Taken together, the numbers suggest a shift in the group’s technology investment model: away from large capitalised software development projects and towards cloud-based and subscription services that flow through the income statement as operating expenses.

Core banking system

This mirrors a broader industry trend as banks globally move workloads to the cloud, reducing upfront capital commitments in favour of consumption-based pricing models.

The group’s total intangible asset base also continued to shrink, falling 15% to R9.57-billion as assets were amortised and impaired faster than they were replaced. Software impairments of R164-million were recognised in the period, down from R186-million a year earlier.

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One of the most striking disclosures in the results relates to Standard Bank’s SA Core Banking system, which carries a net book value of R3.69-billion — down from R4.5-billion — making it by far the group’s largest single software asset.

During the year, management extended the system’s estimated remaining useful life from three years and seven months to six years and seven months, following what it described as “an updated assessment of the additional economic benefits expected from continued use of the asset”. The life extension reduced amortisation charges by R339-million in the period.

Standard Bank’s technology spending trajectory offers a window into how one of the continent’s most systemically important financial institutions is navigating digital transformation.

The R14-billion-plus annual technology bill places Standard Bank among the largest technology spenders in corporate South Africa. For context, the group’s software, cloud and technology costs alone exceed the total annual revenue of many listed South African technology companies.

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Across the group’s banking segments, personal and private banking bore the bulk of technology costs at R6.59-billion, followed by the corporate and investment banking division at R3.96-billion and business and commercial banking at R1.01-billion. A further R2.27-billion was allocated to central and other group functions.  — (c) 2026 NewsCentral Media