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Standard Chartered’s pre-tax earnings rose 18 per cent year-on-year in the first quarter, surpassing analysts ’estimates as UK lenders reduced their provisions for bad loans in the coronavirus pandemic.
A bank focused on emerging markets has been the latest donor to benefit improving the global economic outlook a year after the onset of the Covid-19 outbreak.
The $ 1.4 billion profit was higher than the $ 985 million projected by analysts, the bank said Thursday. However, operating profit fell 9% year-on-year to $ 3.9 billion, according to forecasts.
The bank charged a $ 20 million credit impairment, $ 936 million less than in the first quarter of last year. It canceled $ 35 million in reserves reserved for potential loan losses, far less than HSBC’s major rivals, it announced $ 400 million release supply this week.
StanChart CEO Bill Winters said Covid-19’s economic recovery has led to improved transaction volumes and profitability. “That was especially true in our financial markets and wealth management, which has been the best quarter ever,” he said. “Despite low interest rates, we expect our underlying momentum to lead to higher income growth in the second half of 2021.”
The global footprint of the lender has put it at the center of geopolitical tensions between the US, the UK and China. Relations deteriorated last year after Beijing imposed a extensive national security legislation In Hong Kong.
In February, Winters said he hoped U.S. President Joe Biden would reconnect with China and end the “tit for tat” escalation in trade, but it has been little evidence of reconciliation.
StanChart has struggled to balance trade dependence on China with its mission statement: “here for good.” It has also come under pressure from its board of directors and investors to better define its human rights and environmental positions.
This week, HSBC reported a quarterly increase in net income of $ 79.8 billion to $ 5.8 billion, significantly higher than analysts forecast for $ 3.3 billion.
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