Good morning, ladies and gentlemen. Thank you ever so much for joining us as we present our 2021 results. If you are joining us on BlueJeans and would like to ask a question, please do so by clicking on the Q&A link on the right-hand side of your screen. If you're joining us via Chorus Call, you will have an opportunity to ask questions at the end of the presentation. 2021 was a year of recovery for the world economy, which grew at 5.9%, a vast improvement from the 3.1% decline in 2020. In the second half of the year, increased demand and supply chain disruptions caused inflation and the prospect of tighter monetary policy increased volatility. Climate change and then the Omicron variant dominated the global agenda in the latter part of the year.
In sub-Saharan Africa, the recovery was more muted, with the regional economy growing at 4%. Following a very severe contraction in 2020, the South African economy is estimated to have grown by 4.9% in 2021. Social grants provided support to low and no income households. Debt levels in the middle and upper income households remained below previous levels, indicating their capacity to borrow. The events that took place in KwaZulu-Natal and Gauteng in July were a harsh reminder of South Africa's weaknesses, including our exceptionally high levels of unemployment. While the financial impact on our business was limited, these events resulted in disruptions to business and knocked confidence. The fiscal position benefited from commodity-related windfall tax collection. Pleasingly, there was some progress on structural reform, particularly in the electricity and transport sectors, but in general, the pace of reform remains slow.
Overall, the global, Africa, and South African recoveries created tailwinds for our business in 2021. We are, of course, very conscious of the rapidly developing situation in Ukraine and Russia and its wider consequences. We are closely monitoring events to ensure that we comply with all relevant local and international laws and guidelines, and in order to manage the consequences for our business and our clients. Although we have limited direct exposure to Russia through our controlled operations, we do, however, have some clients with businesses that are being directly affected. We will support them as appropriate and to the best of our ability. While it is too early to say the wider second round and long-term effect of these events are likely to be, we have already seen volatility in markets and commodities.
ICBCS, as an emerging markets and commodities business, has exposure to certain entities which are being impacted. ICBCS is responding to developments in line with its contingency plans. At this stage, given the uncertainties and fluid nature of the developments, it is not possible for ICBCS to assess the impact on its 2020 results. In Africa, somewhat slower economic growth is also possible, although the pattern of the effects will differ across the continent. Some countries, including the oil and gas producers, may benefit from higher commodity prices. If the war drags on, some African countries may be at risk of worsened food insecurity. Only a few African countries, notably Egypt and Malawi, have significant direct exposure to Russian or Ukrainian trade and investment.
South Africa, for instance, sells 0.3% of our total goods exports to Russia and receives 0.7% of our goods imports from Russia. Further, as a commodity exporter, South Africa's terms of trade are somewhat shielded as prices rise. Moving to our financial highlights. I'm very pleased to report that the group recorded record pre-provision operating profit in the second half of 2021. For the full year, pre-provision operating profit equated to ZAR 47.8 billion, 5% up on 2020. The group's earnings rebounded 57% to ZAR 25 billion. As you will see when Arno presents, this improvement was driven both by a recovery in client activity and by growth in our franchise. Group return on equity improved to 13.5%. Standard Bank activities return on equity was 14.7%, in line with cost of equity.
The group ended the year with a Common Equity Tier 1 ratio of 13.8%. The board approved a final dividend of ZAR 5.11 per share. This equates to a dividend payout ratio of 60% in the second half of the year and 55% for the full year. During 2021, we made strong progress in three areas. We achieved franchise growth across all three of our core businesses. We made good progress in developing new revenue streams by scaling up our digital platforms and partnerships. We remain focused on diligent allocation of capital to fund expansion while carefully managing costs, and we successfully completed the Liberty minority buyout last week. In August last year at our strategic update, we revised our strategic priorities and defined and presented our 2025 targets.
This is our commitment to you, and I'm pleased to report that we are on track to deliver on this commitment. Starting with 1, core franchise growth. This strong set of results is underpinned by our high quality growing client franchise and our leading market shares. On client franchise growth, Consumer and High-Net-Worth grew clients by 8% and Business and Commercial by 5%, and CIB added new clients to its already enviable list of local and global corporates and institutions. Our main market transactional account and flexible funeral product were key drivers of Consumer and High-Net-Worth growth in South Africa. Our digital onboarding, digital SME onboarding, servicing and flexible lending solutions supported BCC client acquisition in African regions.
It is also worth noting that in line with our develop once and roll out many times philosophy, our digital onboarding solution has been rolled out in 7 countries and our automated SME scorecard lending capability in 9 countries. Pleasingly, our investment in digital solutions, including origination and fulfillment, is showing up in new digital applications, larger digital engagement volumes, and more digital fulfillment. We have more digital clients doing more things more often. From a market position perspective, we took advantage of our strengths and grew our lending market shares and leading market shares in mortgages and cards in South Africa. We also retained our leading position in deposits in the country. We retained our dominant position in FX and custody across most of our presence countries. In South Africa, we ranked number one in ZAR debt and DCM.
In 2021, we continued to build our sustainable finance franchise. We structured a number of market firsts, including Africa's first sustainability-linked bond. We committed to finance ZAR 19 billion in renewable projects in South Africa. We facilitated over ZAR 20 billion in sustainable finance for our clients and issued almost ZAR 5 billion for our own sustainable projects with a focus on renewables and affordable housing for women. The group also issued our first tier two green bond and our first social bond. The funds raised will be applied to fund renewable energy and financial inclusion aligns to the SDGs. We are the third-largest asset manager on the continent and remain the leading pension fund provider in Nigeria. In 2021, we won a wide range of awards across our countries of operation and our businesses.
This range is testament to the breadth and depth of excellence that makes Standard Bank Group the most valuable bank brand in Africa. Pleasingly, our efforts were also reflected in improvements in our client experience ratings. In particular, in South Africa, where our SASCI rating improved for the second year in a row. Turning now to our balance sheet. Our banking balance sheet, to be precise. We have very deliberately managed our risk appetite in order to continue to support our clients throughout the pandemic. On this slide, we show how our balance sheet has grown and shifted over the last three years. Starting with deposits, on the left, on the top left, we have successfully attracted retail priced deposits, reducing our need for more expensive market funding. On the bottom left, our Africa regions and international franchise have recorded exceptional growth.
Our international deposit franchise has reached a remarkable GBP 6.5 billion. In terms of customer loans, our retail and business portfolio and its growth has been strong. Again, our Africa regions portfolio outstripped growth in South Africa. These trends clearly reflect our success in growing cheaper retail deposits, as well as in allocating capital to grow our portfolio in Africa regions. You ought to ask, how does this translate into the core franchise numbers? Simply put, we achieved a record performance across net interest income, non-interest revenue, and pre-provision operating profit in the second half of 2021. I will leave Arno to delve into the details shortly. Moving to our new business opportunities and new revenue streams, focusing on payments for now, we're very conscious that the market for payments is evolving very quickly. The modernization and digitization of payments presents threats and opportunities.
While we recognize that regulation is changing and competition is increasing, we are strongly of the view that certain functions and revenue streams will remain within the purview of banks. This includes deposits and interchange. Importantly, we understand and operate across the full spectrum of payments, from large corporate settlements and bulk collections through to small mobile wallet transfers. We will leverage our differentiated value propositions to protect our relationships, protect our client and our current revenue streams, and increasingly build new sources of revenue. We'll do so across corporate, merchants, and individuals. Turning now to partnerships, it bears repeating that in our digital age, markets will increasingly be defined and dominated by networks of partnerships. As we have mentioned on previous occasions, we are increasingly open to partnerships. In fact, we have already built an enviable network of partners across fintechs, big techs, and telcos.
Talking of partnerships, Founders Factory Africa continues to be a valuable source of innovative Africa-relevant startups, and enables us to achieve our objective of supporting the development of local entrepreneurs. We were very pleased to announce our partnership with Flutterwave, an Africa success story and a disruptor in digital payments. In 2021, we remained focused on simplifying this group. We continued digitizing our processes, increasing our digital fulfillment from 22% to 28% of our services. We continued to engage with ICBC on a path to exit our stake in ICBCS, and we completed the Liberty transaction in line with our timetable. To those who have become Standard Bank shareholders as a result of that transaction, welcome. We look forward to engaging with you, and we commit to delivering attractive shareholder returns.
We managed costs tightly and delivered positive jaws and a declining cost-to-income ratio, and we continue to invest in our people, our systems, our digital solutions, and our data management. In closing, while I recognize that there is always more to do, I'm very pleased with the way we delivered against what we set out to do. I will now hand you over to Arno to describe how our strategic progress translates into our financial performance. Arno, over to you.
Thank you, Sim, and welcome to our listeners, and it's great yet once again to report the Standard Bank results to you. Starting on slide 12, I will take you through the financial outcomes of the year ended 31st of December, 2021. The group's earnings rebounded strongly in 2021. Pre-provision operating profits grew by 5% for the year. This was driven by positive jaws and hence a lower cost-to-income ratio. Headline earnings grew by 57% to ZAR 25 billion, and this growth was supported by significantly lower credit charges, shown here as a credit loss ratio of 73 basis points. This robust result allowed a declaration of a final dividend of ZAR 5.11 per share, bringing the total dividend to ZAR 8.71 per share, a 55% payout ratio for the year.
The group's return on equity recovered to 13.5% from 8.9% in the prior period. On slide 13, we walk you through our headline earnings growth by income statement line item to end at ZAR 25 billion. The standout driver is clearly the recovery in credit and payments, shown as the large gold bar in the center of the chart. At the bottom of the chart, we have shown the rand and constant currency growth rates for the various income statement line items. As you can see, the relative strength of the rand had a large impact on our results, dampening the results from our non-SA entities in the period. Headline earnings growth of 57% in rand translates to a growth of 70% when measured in constant currency.
Slide 14 shows our income statement, including a 2019 column for comparison against the more normalized pre-pandemic period. Using this analysis, we can see that revenues are up 5% on last year and up 3% on 2019. Within total revenues, non-interest revenue is 8% higher than 2019, but NII is still slightly below 2019 levels, given the negative impact of enduring lower interest rates in 2020 and in 2021. The charge for credit impairments at ZAR 9.9 billion has more than halved compared to 2020, but you can see it remains elevated compared to 2019. Standard Bank activities headline earnings growth was 59% up in ZAR and 71% up in constant currency. After we include the results from ICBCS and Liberty, group earnings growth dilutes slightly to 57%.
The group's average balance sheet has grown over the year, with average interest earning assets growing by 1% and interest-bearing liabilities growing by 4%. The average retail and business lending portfolios grew by 9% year on year. This was offset by lower average corporate and other lending books, down 11%, coming off a record high base in 2020. In South Africa, our two largest retail asset classes of mortgage and vehicle and asset finance saw record disbursements of ZAR 80 billion and ZAR 47 billion, respectively. Investment banking disbursements were ZAR 180 billion in 2021. Average interest-bearing liabilities growth was supported by strong growth in retail priced deposits. After absorbing the impact of lower interest rates in 2020 and in the first half of 2021, NII growth resumed in the second half of 2021.
It's worthwhile pointing out the cumulative negative endowment impact on NII for these three periods, in other words, an 18-month period, is almost ZAR 10 billion. NII growth of 2% for the year was supported by continued growth in our balance sheet and slightly increased margins. The endowment impacts, while still negative, waned somewhat in the second half. The stronger growth in retail and business loan book and the retail growth in retail-priced deposits I referred to earlier drove favorable mix changes which saw us supportive for our margins. The net interest margin increased 3 basis points to 373 basis points for the year. Our largest contributor to non-interest revenue, being net fee and commission income, increased by 4% as client activity levels and transactional volumes improved relative to the prior year.
In South Africa, the negative impact of pricing adjustments to ATM and cash transaction fees, the discontinuation of checks, and the continued migration to digital channels was more than offset by client growth and higher transactional volumes. Digital transaction fees recorded double-digit growth as we expanded our digital functionality and clients embraced our innovative, convenient, and cost-effective digital solutions. Good growth in our active merchant account base and point of sale devices combined with higher spending, drove higher card acquiring and issuing turnover and associated fees. Trading revenue pleasingly grew by 7% to ZAR 14.8 billion. The South African business in particular recorded a strong performance driven by structured trades and foreign exchange client sales. This more than offset a decline in Africa regions, which, as you will remember, came off a high base in 2020.
Other gains and losses benefited from the partial reversal of prior year equity revaluation losses. On slide 18, we turn to credit provisions and start by looking at our balance sheet position as at year-end. Year-end lending balances grew by 12%, and stage three loans make up 4.7% of the book. This has reduced from 5.5% as non-performing loans were repaid or moved back to stage one or stage two as conditions improved. In the right-hand graph, you can see provisions grew further off a high base to ZAR 51.4 billion. Stage three provisions of ZAR 36 billion were held against the stage three book of ZAR 70 billion. Clearly, this provides a cover then of 52%, which is up from 46% this time last year.
On slide 19, we compare the build-up in provisions in 2020 to 2021. Net provisions raised in 2021 have almost halved as lower forward-looking provisions were required and consumers resumed payments or repaid loans. Offsetting this somewhat, the South African card portfolio saw continued strain, specifically in the expired payment holiday book, which required increased provisions in 2021. Write-offs increased against legacy corporate exposures in 2021, and we saw a resumption of bad debt book sales in the card and unsecured personal portfolios. The income statement charge for credit impairments has declined for each of the last 3 reporting periods from a high in the first half of 2020, when the effects of the COVID-19 pandemic were first accounted for.
The reducing charge can be explained by reducing forward-looking provisions due to an improved outlook, as well as matured debt relief portfolios and a net credit in CRB in 2021. On slide 21, we can then see the group credit impairment charge for 2021 of ZAR 9.9 billion split by client segment. A net release held in the CRB client portfolio amounted to ZAR 311 million as client exposures matured and were paid down. A large decline in credit provisions of 36% in consumer and high net worth clients is evident given cures in the payment holiday portfolios and a generally improved operating environment.
This reduction absorbs higher provisions in the card portfolio I mentioned earlier. In the business and commercial client portfolio, provisions declined by 37% compared to the prior period, which represents a lower charge in South Africa, offset by a more normalized charge in Africa regions. We have retained the ZAR 500 million central judgmental credit provision created in 2020, given the continued uncertain environment. Slide 22 represents the credit charge as a loss ratio. The group ratio of 73 basis points is made up of a recovering CIB of 6 basis points, a loss ratio in BCC of 124 basis points, and a loss ratio in CHNW of 137 basis points, which is inside the target range of 100-150 basis points. Turning to OpEx.
Cost growth was 4% in 2021, and positive jaws of 54 basis points were generated, resulting in Standard Bank activities cost-to-income ratio of 57.9%. Staff costs increased by 7%, driven by annual inflationary salary increases and higher performance-related incentives. Other OpEx grew just 1% as higher marketing costs were offset by lower professional fees, lower premises costs as we rationalized our footprint and continue to do so, and lower depreciation charges. Technology costs increased by only 3% following strict prioritization and our adoption of the save to invest philosophy. This, coupled with efficiencies delivered through our simplification journey and conscious focus on reducing our dependency on third parties, allowed for investment to be prioritized in acceleration of our cloud capabilities.
We continued to focus on generating operational leverage and positive jaws, and we are pleased that we've been able to regain the momentum after pandemic-related revenue pressures in the last two reporting cycles. Here you can see in the second half of 2021, revenues rebounded strongly to grow just below 12% year-on-year. The higher cost growth in the second half reflects the base effects of prior year adjustments, including on incentives, and is expected to normalize to below inflationary growth in 2022. On slide 26, we have sliced earnings in three ways. The first and primary representation is by client segments based on client types. The middle chart shows a product or client solution view of earnings. In our detailed booklet, we break down banking further into home services, vehicle asset finance, transactional products, global markets, et cetera, et cetera.
In our current reporting, as you can see it here, Liberty is excluded from insurance and investment products. The third chart is our regional segmental splits, where we use legal entities as a proxy for regions. In this period, Africa region's contribution to group headline earnings was 36%. The top 6 contributors to Africa region's headline earnings remained Angola, Ghana, Kenya, Mozambique, Nigeria, and Uganda. Clearly, these charts demonstrate the diversity and breadth of our franchise across client segment, solution, and geography. Let's have a look at the performance by client segment. Consumer and High Net Worth headline earnings improved by 127% to ZAR 6.9 billion, and the ROE increased to just below 14%. Robust balance sheet growth, particularly home loans in South Africa and unsecured loans in Africa regions, supported NII.
A growing client franchise, increased client activity, and higher client spend supported non-interest revenue. Credit charges declined 36% as client repayments increased and collection strategies bore fruit. As you heard from Sim, client experience ratings and active customer numbers improved significantly. Business and Commercial Clients segment delivered headline earnings of ZAR 5.3 billion, an increase of 25% on 2020, and a return on equity just below 25%. Net interest income grew as balance sheet growth more than offset significant negative endowment headwinds. Non-interest revenue grew as trade and transaction volumes recovered. Credit payment charges in this segment declined by 37%, driven primarily by lower charges in South Africa. CIB earnings increased 43% to ZAR 13.4 billion, and the ROE improved to just below 20%.
Revenue grew 5% overall, with a smaller average balance sheet and endowment impacting net interest income. Prior year fair value equity losses reversed and market volatility provided trading revenue opportunities for our clients to allow NIR to grow 13%. The absence of new non-performing loans, combined with the successful restructuring and repayments of previously impaired advances, led to a net impairment release. Moving to performance by client solution on slide 28. Here you can see banking solutions headline earnings of ZAR 23 billion, and they improved considerably, up 62% year-on-year. Banking solution revenues increased 5%. Costs within banking were well managed, increasing only 4% after absorbing annual salary increases, ongoing work from home costs, higher digital capability development costs, and the normalization of performance-related incentive costs. Our ROE of just over 17% was achieved.
Our insurance business, excluding Liberty, recorded a healthy growth in policies and gross written premium, which supported revenue, and that is net of claims, of ZAR 4.4 billion. Despite the current elevated levels of claims, this business has continued to grow net revenue year-over-year by 5%. Elevated claims were on the back of a larger policy base, pandemic related credit and funeral claims, and weather-related short-term claims. Retrenchment claims remained lower than we had expected at the beginning of the pandemic. The group, including Liberty, is a significant player in the long-term insurance sector and the largest provider in credit insurance in the South African market. Our simple, digitally enabled funeral product continued to resonate with customers, and we have sold over 1 million policies since its launch in October 2020.
The majority of insurance headline earnings are generated in South Africa, but the Africa regions insurance business is starting to deliver strong growth. You can see our capital light insurance business continues to deliver a strong ROE of around 55%. Turning to investments. Standard Bank Group, including Liberty, is the third largest asset manager on the continent, with combined assets under management, administration and custody of ZAR 1.4 trillion. The business shown here excludes Liberty and grew assets under management by 12% year-on-year. AUM grew across all three regions. In South Africa up 9%, Africa regions 14%, and international +17%. Revenue grew by 2%, dampened by the stronger rand. We're very pleased that Melville Douglas won the coveted Raging Bull Award for the best offshore management company in 2021.
In addition, our Nigeria pension fund business continued to retain its leading market share, and our Ghana institutional business continues to record strong net client cash flows. Headline earnings grew 11% to ZAR 755 million, and our return on equity over 27% was achieved. Looking at performance by region, you can see here the Standard Bank of South Africa bounced back strongly. Headline earnings were 2.7 times higher than in 2020, and ROE recovered to just below 13%. Revenue grew double digits, boosted by higher trading and other revenues. Credit charges more than halved and costs were well contained to deliver positive jaws just under 200 basis points. Our Africa regions franchise delivered strong top-line growth in local currency terms, underpinned by ongoing balance sheet and client franchise growth. Inflation and weaker currencies in key markets dampened translated earnings growth.
Headline earnings declined 2% and the return on equity remained accretive at 18.2%. Here we break down our African regions' operations into three sub-segments. In East Africa, revenues held up well in constant currency and credit impairments improved. Positive jaws helped headline earnings grow 22% in constant currency. In rands, headline earnings improved 10% and return on equity improved slightly to 14.7%. In South and Central Africa, revenues rebounded strongly as interest rates increased in Zambia and Mozambique, and fees bounced back after the lifting of waivers in the prior period. Credit impairments increased in Botswana and Mozambique, and together with negative jaws in this region, dampened earnings growth to 8% in constant currency. ROE was a pleasing 20%.
In West Africa, strong balance sheet growth was not enough to offset the impact of lower margins, and you can see here NII declined. Fee income growth was strong, but trading revenues declined relative to the excellent trading performance and the high base set in the prior period. Credit losses were lower. Operating expense growth was high in constant currency, driven by increased deposit insurance costs in Nigeria and Ghana. West Africa headline earnings declined marginally in constant currency to ZAR 3.2 billion, and the ROE reduced to 18.3%. Looking at Liberty's performance, Liberty's performance in the reporting period was much improved from the prior year, albeit still negatively impacted by the pandemic. The buyout of the Liberty minority shareholders that was announced on the 15th of July last year was completed on the 1st of March this year.
Given that Liberty is no longer listed and hence not hosting a results presentation, we have increased the amount of information regarding Liberty in this presentation and in our analyst booklet. Liberty's annual financial statements for 2021 will be, and actually have been, loaded on the Standard Bank Group website today. In 2022, we will be focused on closer integration to unlock value through revenue and capital synergies. We will be working on including Liberty's results in our insurance and investment solutions reporting. We are very encouraged by the improvements in Liberty's normalized operating earnings, driven primarily by the South African insurance operations. On this slide, you can see insurance index new business increased by 26% year-on-year, and improved sales volumes contributed positively to the increase in value of new business.
The value of new business margin improved to 0.5%, but this remains below pre-pandemic levels. STANLIB grew assets under management by 14%. Liberty, throughout this crisis, has remained well capitalized with a solvency cover ratio of 1.72 times as at the end of last year. As indicated on the previous slide and shown here in the middle of the table, Liberty's normalized operating earnings, these are pre-COVID-19 pandemic impacts, amounted to ZAR 1.35 billion. This is a strong turnaround on the prior year. An additional post-tax COVID-19 pandemic reserve of ZAR 1.8 billion was raised in 2021, and mortality experience exceeded assumptions by ZAR 1.2 billion in the period. These both contributed towards a normalized headline earnings loss in 2021. A strong recovery in the shareholder investment portfolio helped to shield these impacts.
After adjusting for treasury shares, the group's share of the loss amounted to ZAR 419 million. The operational performance of ICBCS continues to be resilient, underpinned by favorable market conditions in 2021 and increased client activity. In 2021, ICBCS recorded a profit of $87 million. As you can see here, the group's 40% share of earnings equated to $35 million or ZAR 500 million. Two events have recently impacted ICBCS, which will impact their 2022 results. First, in January 2022, ICBCS received a net insurance settlement of approximately $230 million pre-tax relating to a previous loss following a fire at a client's oil refinery site and their subsequent bankruptcy. The group's post-tax share thereof equates to around ZAR 1.2 billion.
Secondly, as Sim mentioned earlier, ICBCS has exposures to a number of entities that have been impacted, either directly or indirectly, by the war in Ukraine. ICBCS took proactive steps to review its Russian and Ukrainian activities against the backdrop of rising tensions and, where appropriate, had already reduced its limits for entities which they believe could be affected. Due to the uncertainty and fluid nature of the situation, it is not possible to assess the direct or indirect impact thereof on the ICBCS's 2022 results at this stage. Moving to capital and liquidity. Slide 36 provides an overview of the group's capital stack and CET1 ratios as well as our liquidity ratios.
During the period of the pandemic crisis, the group has maintained robust capital and liquidity positions, which importantly enabled us to continue to support our clients and grow their growth aspirations and our balance sheet. As at the end of 2021, our capital levels increased to ZAR 230 billion with a strong Common Equity Tier 1 ratio of 13.8%. During 2021, the group successfully raised Basel III compliant additional Tier 1 capital of ZAR 3.5 billion and Tier 2 capital bonds of ZAR 3.2 billion. The group's liquidity position remains strong and a net stable funding ratio in excess of the 100% regulatory requirement was maintained. The group's Basel III liquidity coverage ratio amounted to 144%, above the temporarily reduced regulatory minimum requirement of 80% as of end of last year.
The group ROE recovered to 13.5% in the period, and while improved on the prior period, remains below our cost of equity of 14.7%. Our Standard Bank activities ROE equaled our cost of equity in 2021. As mentioned by Sim, our dividend payout ratio for the year is 55% and for the second half of 2021 is 60% at the top end of our guidance range. Of course, this was enabled by our strong capital generation. Capital optimization is a focus for us, both from a supply and an allocation perspective. Our disciplined capital allocation processes will ensure capital is reallocated away from low ROE businesses, more capital is allocated to grow our existing insurance and investment businesses, and increased capital is allocated to high growth, high ROE markets and high ROE sectors.
We remain confident that we are on track to deliver a return on equity of 17%-20% in the medium term. I'm now turning to look forward to 2022. This year, global growth is expected to remain above trend with global real GDP growth of 4.4% and 3.7% in sub-Saharan Africa. Pent-up consumer demand should fuel spending and support trade. In many sub-Saharan economies, debt levels are high, and there will be a need to balance fighting inflation and supporting the economic recovery. A broad hawkish bias is expected with interest rate increases expected in many of our countries of operations supporting NIM. South Africa's economic recovery is expected to continue with real GDP growth of 2% expected in 2022. Inflation is expected to moderate, supporting a gradual rate hiking cycle.
We have already seen 125 basis point hike in 2022, and we expect 3 more in this year. We remain obviously concerned about the high levels of unemployment and believe that structural reforms need to be accelerated to boost confidence, investment, and to drive faster growth. As mentioned by Sim, we are closely monitoring the developments related to Ukraine and Russia and the potential indirect spillover effects which may impact these forecasts. From a financial outcome perspective in 2022, we expect the following. Higher average interest rates will support margins, which together with increased higher average balance sheet will support strong net interest income growth.
Non-interest revenue will continue to grow as our client franchise and higher activity related fees offset potentially lower trading revenues, which are coming off a high base. Of course, we will maintain a very diligent focus on costs in line with our safety and risk principle, and we have the objective of delivering strong positive jaws. CRB credit payments are expected to normalize, and the group's credit loss ratio is expected to be at the lower end of the group's through the cycle range of 70-100 basis points. Deliberate resource allocation, including further capital optimization, will support a further recovery in return on equity above our cost of equity. That brings the results analysis to a conclusion. Thank you for your attention. I will now hand back to Sim to conclude.
Many thanks, Arno. Before I close, I'd like to comment briefly on four important elements of our strategy. The four themes are key to understanding our business. They define how we think, shape the choices that we make, and are central to constructing our competitive advantage as Africa's leading financial services business. First, we're very much aware that change in African financial services is unrelenting. To keep up, we have a multifaceted approach to skills, development, and innovation. Engineering and other advanced skills remain scarce in South Africa and throughout the continent. We therefore continue to invest in internal skills development to deepen our pool of data scientists, engineers, developers, and behavioral scientists. During 2021, we encouraged innovation through our internal innovation platform, and we've been delighted with the talent and commercial creativity displayed by our employees.
We have also partnered with Microsoft and Amazon to support skills and enterprise development throughout Africa. Second, we are committed to supporting and accelerating a just transition to a low carbon economy. We have completed our climate policy and set out our initial targets. These will be published in the coming days. Our long-term goal is to achieve a portfolio mix that is net zero by 2050. Third, the group remains focused on creating value for all our stakeholders. This is the most effective way for us to support sustainable and inclusive development in Africa. In 2021, we created value totaling ZAR 123 billion. Of this, ZAR 37 billion was paid to employees in salaries and benefits, ZAR 46 billion to suppliers, ZAR 13 billion in taxes, and we returned ZAR 12 billion to shareholders in the form of dividends.
We retained over ZAR 15 billion to reinvest in our business to drive growth. Fourth, we are committed to delivering positive impact in seven areas where we believe we can make a meaningful difference. Each of these seven impact areas is directly linked to the UN Sustainable Development Goals. Our report to society describes this work in a lot more detail. We are pleased, but we're very far from being complacent about our progress in 2021. We achieved a lot and intend to build on this in 2022. Looking back, number 1, our core business has remained strong and continued strong momentum. 2, we're making good progress in our new business areas. 3, we are allocating our resources with accuracy and with discipline. Looking forward in 2022, we have three focus areas. First, we're gonna continue to make steady progress towards our 2025 targets.
Second, we will integrate Liberty more closely into the broader group, ensuring that the whole is greater than the sum of its parts. To achieve this, I'm very pleased to announce that subject to regulatory approval, David Munro will be joining and rejoining the Standard Bank Group as Group Chief Executive. Sorry, as Group Executive. I remain Group Chief Executive. As Group Executive responsible for integration. Yuresh Maharaj is succeeding David as Chief Executive of Liberty. Well done, Yuresh. We have also taken the opportunity to restructure the Liberty board, and Yunus Suleman has taken over from Jacko Maree as Chairman. In addition, Jacko, Jim Sutcliffe, Thembisa Skweyiya, Prins Mhlanga, and Laura Hartnady have resigned from the board effective 2 March. We thank all the Liberty board members for their stewardship. Just to mention, I've also resigned from that board.
Third, as we put the pandemic behind us, we will increase our leverage and manage down our capital ratios over the medium term. We will do this through a combination of dividend payments and ROE accretive risk-weighted asset growth. As Arno mentioned, we'll diligently reallocate capital from low ROE businesses to high growth, high ROE opportunities. This includes exiting and reallocating capital from ICBCS to opportunities in Africa. In closing, we remain optimistic about Africa's outlook, and we see good opportunities to lend responsibly in South Africa. In executing our strategy, we will leverage our existing strengths and defend our leading market positions while continuing to grow our client franchise. In doing so, we will deliver on our purpose of driving Africa's growth.
Finally, it's important to acknowledge that 2021 was still a very difficult year for most people, and I'm grateful to all of my colleagues for their continued courage, resilience, and dedicated work in the service of our clients. Thank you, everyone. You've done brilliantly, and I'm very proud of all of you. Thank you, ladies and gentlemen, for your time and interest in the Standard Bank Group. We'll now turn to questions. Sarah, do you start with Chorus or do you s-
Sim, we'll start with BlueJeans.
BlueJeans, great.
Thank you.
Okay.
The first question is for Arno. Arno, it's from Charles Russell. Do you expect the overall provision coverage of 3.5% will track downwards towards the pre-pandemic average of 3.1% over the coming years? Or are there any structural changes that will impact coverage?
Hi, Charles. Yeah. We do expect a continued normalization in our portfolio, specifically going into 2022. We've already seen very positive trends at the second half of last year, and hence, we expect our coverage to normalize to pre-pandemic trends and do not expect a structural change post-pandemic.
Thank you. The next question, Arno, is around preference shares. It's from Sydney Place. Given the strong capital position and positive outlook, is there any intention to redeem the listed preference shares as, for example, Nedbank did recently?
Yeah. Thank you, Sydney. We have not yet made a decision on our preference shares. These are important instruments for our shareholders and continue to deliver value for our shareholders. We take into account the overall shareholder return and not just the preference shares, and this takes into account an overall portfolio management approach to our capital stack. We will let you know once we return them. We also need to bear in mind that the FLAC rules, First Loss Absorbing Capital regulatory rules, have not yet been finalized, and we await for the finalization of those as well. Thank you.
Thank you. The next question, Sim, is around SOEs and municipality exposure. It's from Jonathan Block. Can you comment on the bank's exposure to SOEs and municipalities?
Let me hand that to Kenny. Kenny, do you wanna cover corporate and investment banking? Paul, if you could cover BCC.
Yeah. Yeah, I mean, our sort of exposure to, broadly speaking, what we call, the public sector and sovereign, increased in 2021, from ZAR 79 billion in 2020 to ZAR 112 billion in 2021. There are also, I guess, other factors that are not necessarily related to lending to the sovereign, i.e., the increase, in the sort of cash reserves in Nigeria, which consequently will be classified as part of that exposure to the sovereign.
Paul?
Thank you. Yes. Lending to the municipalities remains a core part of our business. The bulk of the exposure clearly sits in CIB, but we will continue to manage that and work with our clients in that respect.
The next question is, for Kenny again, also from Jonathan Block. Please, can you unpack the trading revenues in a little more detail and the capital allocation thereof?
I mean, trading revenues have continued to be sort of strong in 2021 against an exceptionally good performance in 2020. If I can just go through the various sort of desks within Global Markets just to indicate where the biggest sort of good performance came from. The credit desk did exceptionally well. Equities grew by about 37%. Foreign exchange, which would be a mix of both sort of trading revenues as well as ordinary flow business also did exceptionally well, and so did the money market sort of desk. If I am then to sort of try and separate trading revenues against client revenues within GM, there has been a shift in 2021.
In 2020, the bulk, I mean, of the performance of GM was largely driven by trading revenues with still good performance from client revenues. Nonetheless, because of the volatility that we saw in 2020, there were massive sort of deals that were done or good positioning of the book, which resulted in massive sort of performance of the trading book. That has sort of pulled back slightly relative to 2020, but nonetheless, those desks did exceptionally well across the different asset classes.
Thank you, Kenny. The next question is in relation to Liberty. The question is from Sydney Place. What caused the Liberty loss in the Africa segment of the business this year?
Well, when Mr. Munro is here. David, do you wanna pick that one up?
I think I'll take that, Sim. Good morning, Sydney Place, and it's nice to hear that you give the guys at Standard Bank as hard a time as you used to give us at Liberty. Thank you for that. Sim, I feel compelled to just comment on what you said a moment ago, just so that there's absolutely no confusion. Sim said that he resigned, but he resigned from the Liberty board. Let's just be clear on that. A few moments before, he had said that he had appointed me as the group chief executive. My phone has gone berserk on, which is very appreciated to everyone, but it's not a group executive, it's a group executive. Thanks for that unexpected appointment, Sim. I thought we should just make sure we clear that one up.
Sydney, in response to your question, it's our health business across the African
African regions, we continue to lack scale, but we have a very strong franchise there, and we think it will benefit from integration with the Standard Bank Group, and particularly colleagues in the multinational franchise that CIB has a strong presence in. We think there's a big opportunity there. It's the health business. We did also suffer significant losses as a result of COVID in our African insurance business, in the long-term business there, but obviously those are captured in our pandemic reporting. Thanks very much. Thanks, David.
Thank you. The last is a comment rather than a question before we go to Chorus Call. It's from Clem Heuman. He says, "Good morning, and congratulations on a great set of results and an informative presentation." With that, we'll turn to Chorus Call. Thank you.
Thanks, Clem.
Thank you. We have a question from James Starke of RMB Morgan Stanley. Please go ahead.
Hi. Good morning, Simon and team. Thanks for the opportunity. Three questions from me. The first one just on loan growth. How do you see that evolving from here, and particularly with regards to your CIB business, both in SA and Africa? The second set of questions both relate to ICBC Standard. First up, if you could just clarify or comment on the potential timing of exiting the 40% stake. Lastly, just that insurance recovery, just to confirm that we're passing through your headline earnings at the group level. Thank you.
Kenny, do you wanna pick up the loan growth in CIB?
Yeah. I mean, from a CIB point of view, loan growth on a spot basis was up year-on-year. That's somehow though misleading given that if one looks at the average sort of loan growth year-on-year, it was marginally down. So if you had to reconcile then between the sort of loan growth as well as the NII, you'd see that the NII was down as a consequence of just the average performance of our loan book, plus the sort of reduced margin. Going forward, given that we ended the year with a much more stronger sort of asset book, and we have seen that being sustained in the first two months of the year.
We'd expect that we'll continue to see an improvement overall in our loan, sort of book, as well as an improvement in the overall margin given the rising interest rate environment across the different markets within which we operate.
Just on the exiting of ICBC's, the call option that ICBC has now expired. We've got an agreement with them to commence discussions, which have commenced, to try and convince them to acquire the asset from us. That's an ongoing delicate approach. I don't think we can give a time as to when we will succeed in persuading them. Just in terms of the agreement we have with them, those discussions are ongoing. Arnold, do you wanna deal with the insurance claim?
Insurance claim will be in our earnings and is accounted for during the month of February this year. ZAR 1.2 billion, as I mentioned on the podium.
Thank you.
We have no further questions from the conference call.
Well, thank you very much everybody for spending time with us. It's been great to be with you. We're very determined to continue executing our strategy, as we've told you. We're on path to meeting our targets by 2025. That will happen through disciplined execution. With that, let me wish you all of the best, and we'll see you either on Microsoft Teams or physically in due course. Goodbye.