Connect with us

Hi, what are you looking for?

Top Story

Standard Chartered’s 2018 profits rise despite setting aside fine cash

The UK-based bank has been stalked for years by probes on both sides of the Atlantic over alleged violations of United States sanctions against Iran/AFP

Hong KongChina, Feb 26 – Standard Chartered’s pre-tax profit surged to $3.9 billion in 2018, the bank said Tuesday, after previously warning it had set aside nearly $1 billion for regulatory fines in the US and Britain.

The UK-based bank has been stalked for years by probes on both sides of the Atlantic over alleged violations of United States sanctions against Iran and investigations related to foreign exchange trading and financial crime controls.

Last week the bank said it had put aside $900 million to deal with those probes, the first time it had put a figure on the penalties and an attempt to draw a line under the issue ahead of its earnings report.

In a Tuesday filing with the Hong Kong stock exchange, the emerging markets lender said its pre-tax profit was up 28 percent at $3.9 billion.

But that figure dropped to $2.5 billion “after provision for regulatory matters and restructuring and other items” were taken out, a rise of 5.5 percent on 2017’s results.

The headline profit was some $120 million lower than a consensus forecast compiled by the bank, Bloomberg News reported. But analyst Dickie Wong of Kingston Securities said the earnings were “in line with expectations”.

Standard Chartered has been bracing for a possible US fine related to past dealings with Iran dating back as far as the late 2000s.

Last month it settled a currency trading investigation and said it had received notice from British regulators that it faced a $133 million fine over historical financial crime controls — although it is still weighing its options over that penalty.

Wong told AFP the fines were “definitely not something good but won’t affect its overall business or dividend policy”.

The bank’s shares were up some 2.7 percent in early afternoon Hong Kong trade.

Advertisement. Scroll to continue reading.

On global issues for the year ahead the bank identified trade tensions between Washington and Beijing as well as China’s economic slowdown as key uncertainties faced by the bank that had “high potential impacts”.

Brexit, it said, had a “low potential impact”.

Chief Executive Officer Bill Winters took over in 2015 and set about cleaning up a balance sheet saddled by bad loans. The Asia, Middle East and Africa focused bank has since returned three successive years of profit growth.

But Winters is under pressure to convince investors he can continue to cut costs while reviving longer-term earnings growth and profitability.

In a separate filing on Tuesday, Standard Chartered announced a three year plan to try and achieve those goals which included streamlining operations, embracing digitisation, increasing investment in its affluent client business and eliminating “residual drags” on “low-returning markets, including India, Korea, the UAE and Indonesia”.

“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,” Winters said in a statement attached to the filing

Click to comment

More on Capital Business

Executive Lifestyle

NAIROBI, Kenya, Mar 12 – The country’s super wealthy individuals are increasing their holding of bonds, gold and cash, a new report by Knight...

Ask Kirubi

NAIROBI, Kenya, Mar 9 – Businessman and industrialist Dr. Chris Kirubi has urged members of the public to exercise extreme caution when making any...

Ask Kirubi

NAIROBI, Kenya, Mar 24 – Businessman and industrialist Dr. Chris Kirubi is set to own half of Centum Investment Company PLC, following a go-ahead...

Ask Kirubi

It is without a doubt that the COVID-19 pandemic has caught the whole world by surprise. Although its full impact is yet to be...


NAIROBI, Kenya, Jun17 – Kenya’s tea leaves manufacturer Kericho Gold, has been awarded the Superbrands Seal by Superbrands East Africa for their quality variety...


NAIROBI, Kenya, Mar 18 – Commercial Banks have been ordered to provide relief to borrowers on their personal loans, with loans eligible from March...


NAIROBI, Kenya, Apr 13 – As the local telecommunications industry gears up to roll out 5G networks in the country, the Communications Authority of...


NAIROBI, Kenya, Mar 22 – Airtel Kenya is offering free internet access for students in order to enable continued learning at home in the...