BackStanChart year profit tops $5 bn, strong January
StanChart year profit tops $5 bn, strong January
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London: Standard Chartered met expectations with a 13% jump in 2009 profit, as strong investment banking growth in its core Asian markets offset a jump in bad debts in the Middle East.
The bank said it would give bonuses to management, unlike many London-listed rivals, and pay to retain top bankers, saying competition for talented staff was “red hot" in its footprint.
Standard Chartered said on Wednesday its 2009 pretax profit rose to $5.15 billion from $4.6 billion, just ahead of a forecast for $5.1 billion.
Bad debt jumped by half on the year to $2 billion, largely due to a rise in losses in the Middle East. Analysts had expected impairments to hit about $2.1 billion. The bank said loan losses had reduced in the second half of the year.
The bank, which has been led by chief executive Peter Sands for just over three years and has fared better than most rivals during the downturn thanks to strong capital and liquidity, said 2010 had started “very strongly" and was ahead of a year ago.
Wholesale banking continued to drive growth, with 2009 profit of $4.1 billion, up over a third from 2008.
The consumer arm has fared less well due to the economic slowdown, rise in bad debts and as its business in Korea has struggled. Its profit fell a fifth to $867 million
Korea delivered a better performance in the second half of the year, and Standard Chartered said it expected further improvement this year.
The Middle East region would remain difficult due to problems in Dubai and credit problems elsewhere in the region, it said.
Standard Chartered, which has been a strong advocate of performance-related pay, did not disclose how much management will be paid, but said total compensation compared to revenue was 32% for the year, down in each of the past two years and below most rivals.
It spread the cost of a British bonus tax across its global bonus pool, it said.
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