Standard Chartered PLC beats profit expectations
StanChart is encouraged by “robust levels of export growth” across many of its markets in Asia.
Standard Chartered PLC (LSE:STAN) beat expectations with its third-quarter adjusted profit before tax.
Helped by a reduction in bad debt write-downs to US$107mln from US$353mln in the same quarter of 2020, profit before taxation in the three months to the end of September rose to US$1,075mln from US$745mln the year before; analysts had been expecting a profit figure of around US$1.07bn.
Operating income rose to US$3,765mln from US$3,519mln a year earlier, which was comfortably ahead of the market’s expectations of US$3,690mln and up 5% year-on-year on a constant currency basis.
The CET1 ratio – a measure of the strength of the Asia-focused bank’s balance sheet strength – improved to 14.6% from 14.4% the year before, confounding analysts who had expected a slight dip to 14.3%. The bank said it expects full-year CET1 will be around the top end of the 13-14% guidance range.
StanChart said economic recovery from the COVID-19 pandemic has continued to be uneven and punctuated by supply-chain disruption; however, it is encouraged by “robust levels of export growth” across many of its markets in Asia.
It continues to expect full-year income to be similar to that achieved in 2020 on a constant currency basis, with the fourth quarter seeing a quarter-on-quarter dip, reflecting seasonality comparable to prior years.
Full-year operating expenses, including the impact of currency translation and performance-related pay, is expected to be at or below US$10.4bn while excluding the impact of any unforeseeable events, StanChart expects credit impairment to remain at low levels in the fourth quarter.
“We delivered a return to top-line growth in the third quarter and achieved further progress against our strategic priorities, with strong performance in our Financial Markets and Trade businesses and ongoing positive momentum in Wealth Management,” said Bill Winters, the group’s chief executive.
StanChart shares were little changed in Hong Kong trading on the announcement of the results.