Standard Chartered Posts $15bn Operating Income

Standard Chartered Plc has released its results for the year ended 31 December 2018.
The bank’s operating income stood at $15 billion, representing an increase by five per cent, while its Risk Weighted Assets (RWAs) down by eight per cent.

The result showed that the bank’s broad-based by product, with transaction banking growth was particularly driven by cash management which grew by three per cent.

Similarly, net interest income increased by eight per cent and the net interest margin improved three basis points to 1.58 per cent.

“We have made tremendous progress securing the foundations of the business since 2015, resulting in a third successive year of underlying profit growth.
“Our refreshed priorities announced today will help realise the true value of the franchise. We will measure this not only in monetary terms with double-digit equity returns and significant shareholder distributions targeted by 2021, but also in the positive impact to our clients, stakeholders and communities.

“We are determined to drive commerce and help our clients achieve prosperity, while doing everything that we can to make the world a cleaner, safer and more sustainable place,” bank’s Group Chief Executive, Bill Winters said in a statement obtained yesterday.

The results also showed significant improvement in profitability driven by higher quality income growth with cost and asset origination discipline.
The Group delivered $3.2 billion in gross cost efficiencies, exceeding the target it had set in November 2015.
The UK bank levy was $324 million; in 2021 it would be chargeable on only the Group’s UK balance sheet.

Its asset quality also improved due to a continued focus on higher quality origination within a more granular risk appetite, while its credit impairment of $740 million was 38 per cent lower.
Meanwhile, Standard Chartered Plc has announced refreshed strategic priorities that build on the significant progress made by the bank over the last three years.

The refreshed priorities and related actions are expected to deliver a return on tangible equity (RoTE) of at least 10 per cent for the bank by 2021 and generate significant surplus capital that is intended to be distributed to shareholders if not deployed to fund additional growth. The refreshed priorities focus on investing to accelerate growth in the Group’s differentiated network and affluent client businesses, optimising performance in lower-returning markets, driving productivity, and building on existing digital credentials to innovate.

These actions would position Standard Chartered as the leading bank for clients based or doing business in Asia, Africa and the Middle East.
The Refreshed actions and priorities for 2019 to 2021 includes to invest to accelerate growth in our differentiated international network and affluent client businesses; eliminate residual drags on returns from low-returning markets, including India, Korea, the UAE and Indonesia; streamline operations to enhance client satisfaction and drive productivity; and embrace digitisation and partnerships to reinforce competitive advantage and profitably disrupt

It also embeds a performance-orientated and innovative culture emphasising conduct and sustainability.
Winters, was quoted in a separate statement to have said: “Over the last three years we have fundamentally overhauled the bank. It is now a solid platform off which we can grow profitably and sustainably to deliver a double-digit return on tangible equity by 2021.

“We will achieve this through relentlessly focusing on where we have a distinct competitive advantage, attacking the residual causes of lower returns and ramping-up innovation and productivity.
“We view the profound technology-driven changes in banking as an opportunity: we are big enough to be relevant to our most complex clients and partners, yet nimble enough to be a profitable disrupter.”