Standard Chartered posted record-high first half income for its business in China, which it called one of the group’s «biggest strategic opportunities over the coming years».
Standard Chartered posted a record-high first half income of $599 million from the China market in 2022, according to its latest results, up 5.3 percent compared to $569 million in the same period last year.
While the consumer, private and business banking (CPBB) business in China faced challenges related to Covid lockdowns and the impact of weaker market sentiments on wealth management, the corporate, commercial and institutional banking (CCIB) business grew along key corridors in ASEAN and South Asia including strong flows to Singapore, India and Bangladesh.
Overall, the China business registered a pre-tax profit of $242 million in the first half, down 23.4 percent from $315 million in the same period a year ago.
China Opportunity
According to Standard Chartered chief executive Bill Winters, China is one of the bank’s «biggest strategic opportunities over the coming years», noting that the long-term prospects from the opening of its financial and capital markets «remain intact».
As a result, the bank is investing $50 million this year in both onshore and offshore capabilities as part of a $300 million three-year investment plan for the China market.
Ongoing Risks
Still, Standard Chartered is cognizant of the myriad of risks China faces including geopolitical tensions, growth slowdown, zero-Covid policies, property-linked turbulence and regulatory tightening. The bank forecasts that China’s GDP will grow 4.1 percent in 2022 – below Beijing’s 5.5 percent target – and 5.8 percent in 2023.
In the broader region, Asia posted a pre-tax profit of $1.86 billion, down 16.8 percent. Credit impairments surged by $351 million due to charges related to China’s real estate sector and Sri Lanka’s sovereign rating downgrade.
