StanChart lifts income target after wealth boom powers earnings beat; shares jump
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HONG KONG/LONDON, July 29 : Standard Chartered reported on Wednesday a better-than-expected 9 per cent rise in first-half pretax profit and lifted its full-year income target, as wealth and global banking revenue surged and credit charges tied to the Iran war held steady.
The bank’s Hong Kong-traded shares rose more than 5 per cent after the earnings release to hit an almost 19-year high.
StanChart, which earns most of its revenue in Asia and Africa, said that pretax profit for the first six months of this year reached $4.78 billion. That compared with $4.38 billion a year earlier and the $4.52 billion average of 16 analyst estimates compiled by the bank.
The bank revised its guidance for the year, saying it would see income growth around the middle of a 5-7 per cent range instead of previous guidance for it to be closer to the bottom.
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Wealth management income jumped 38 per cent, driven by double-digit growth in investment products as inflows and the number of new accounts increased amid strong demand for wealth advice during a period of market volatility.
“Clients continue to turn to us to facilitate trade, investment and wealth flows across the world’s most dynamic markets,” Group Chief Executive Bill Winters said in a statement.
StanChart said its Middle East portfolio represents 6 per cent of overall exposures, and that it had remained broadly stable.
The lender took a $44 million additional impairment in the second quarter, which it said partly reflected clients in the petrochemical sector showing early signs of distress.
It set aside $190 million as precautionary management overlays in April against expected future losses.
StanChart announced a $1 billion share buyback, along with an interim dividend of 20.4 cents per share, up from 12 cents the year before.
Source: Reuters
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