2nd Nov 2021 09:11
(Alliance News) - Standard Chartered PLC on Tuesday reported double-digit profit growth in the third quarter amid "further progress" for the emerging markets focused bank.
Operating income rose to USD3.77 billion in the three months that ended September 30, up 7% year-on-year. It was up 5% on a constant currency basis. The impact of a lower underlying net interest margin was more than offset by balance sheet growth and strong performances in Financial Markets and Trade, StanChart said.
Following an organisational restructure that came into effect at the start of 2021, the bank's Financial Markets business has been expanded and reorganised, with the company integrating the majority of its Corporate Finance business within Financial Markets. The remaining elements of the Corporate Finance business - primarily M&A Advisory - have been transferred into Lending & Portfolio Management.
Net interest income also increased 7% year-on-year, to USD1.74 billion, benefiting from a positive USD96 million IFRS9 interest income catch-up adjustment in respect of interest earned on historically impaired assets. Excluding this adjustment, net interest income increased 1% on the prior year. Net interest margin narrowed by 7 basis points on a normalised basis, StanChart said.
Pretax profit jumped 44% to USD1.08 billion, helped as the lender's credit impairment charge was reduced to USD107 million from USD353 million.
"We delivered a return to top-line growth in the third quarter and achieved further progress against our strategic priorities," said Chief Executive Bill Winters. "We continue to transform how we serve our customers in the world's most dynamic markets through innovation, partnerships and new ventures."
StanChart said it continues to expect full-year income "similar" to that achieved in 2020 on a constant currency basis. It expects credit impairment to remain at low levels in the fourth quarter.
Its CET1 ratio at the full-year is seen around the top of the 13% to 14% range. This compares with 14.6% as at September 30.
StanChart shares were trading 7.6% lower in London on Tuesday at 467.40 pence each. The wider FTSE 100 index was down 0.5%.
By Evelina Grecenko; [email protected]
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