China reopening ‘pushing activity levels higher’, Standard Chartered CEO says as bank reports 9 per cent jump in first-quarter profit
- Activity in Asia ‘robust despite the recent banking sector concerns in the US and Europe’, CEO Bill Winters says
- Pre-tax profit was US$1.81 billion in the first quarter, beating a consensus estimate of US$1.43 billion
Standard Chartered, one of Hong Kong’s three currency-issuing banks, reported a better-than-expected profit for the first quarter, driven by strong growth in its cash management and Asia businesses.
The emerging markets-focused lender’s net profit rose by 9.4 per cent to US$1.16 billion in the three months ended in March, from US$1.06 billion a year earlier. The London-based bank, which generates much of its pre-tax profit in Asia, reported US$1.81 billion in pre-tax profit, ahead of the US$1.43 billion expected by analysts.
“Activity in Asia and the Middle East remains robust despite the recent banking sector concerns in the US and Europe,” Standard Chartered CEO Bill Winters said on an analyst call. “The recent reopening of China is pushing activity levels higher. This is continuing to show in our numbers, with China offshore income up 67 per cent so far this year.
“The leading indicators of China reopening, such as new client acquisition, support our optimism for performance over the rest of the year. We expect the China recovery to continue, which should help offset the impact of a Western slowdown on Asia economies – should that occur.”
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Standard Chartered took credit impairment charges of US$20 million during the quarter. During the three-month period, the bank also released prior provisions of US$23 million for earlier downgraded sovereign debt exposures and US$2 million related to its China commercial real estate business.
