Standard Chartered PLC (LON:STAN) reported that its profit for the first half of the current fiscal year increased by 4% to $4.088 billion excluding impairment and own credit adjustment compared with its $3.936 billion profit in the first half of 2012.
Standard Chartered’s write down of Korean business value
The British bank generates approximately 75% of its earnings from Asia. During the first half of the year, Standard Chartered PLC (LON:STAN) wrote down the value of its Korean business by $1 billion, which means its profit declined by 24% .
Standard Chartered Bank Plc (LON:STAN) said its net income during the period dropped from $2.86 billion in the same period a year ago to $2.18 billion after the write down, while its income declined in China and Singapore.
The British bank said operating income was $9.751 billion excluding credit adjustment, an increase of 4% from $9.371 billion in the same period in 2012. Its customer advances surged by 3% to $292 billion from $285 billion in the second half of 2012. However, customer deposits were marginally lower at $381 billion compared with the 385 billion customers deposits in the second half last year.
Rise in interim dividend per share
According to Standard Chartered PLC (LON:STAN), its normalized earnings per share increased by 5% to 121.9 cents compared with the 116.6 cents EPS in H1 2012. Its interim dividend per share rose by 6% to 28.80 cents per share, and its normalized return on ordinary the equity of ordinary shareholders was 13.3%.
During the first half of 2013, Standard Chartered PLC (LON:STAN) said its tangible net asset value per share rose by 9% to 1,537.9 cents from 1,414.1 cents in the same period last year. The British bank highlighted that its business performance in Africa, India, and Hong Kong were excellent. In Hong Kong, it generated a profit of $1 billion for the first time in a six months period.
Sir John Peace statements
In a statement, Sir John Peace, chairman of Standard Chartered PLC (LON:STAN) said, “These results demonstrate the diversity and resilience of our business. Despite a difficult external environment, we continue to support our clients’ growth aspirations. We have a strong balance sheet and ample liquidity. Income in both businesses accelerated in the second quarter, and we have entered the second half of the year with good momentum. The Board remains confident for the long term.”
Ian Gordon of Investment Banking and Securities noted that every other bank in the United Kingdom suffered a decline in revenues year-over-year, but Standard Chartered PLC (LON:STAN) a 7% growth H1/H1 or +4% underlying to $9.8 billion in line with his estimate. According to him, the banks’ cost were “very well controlled” excluding the expected Korean goodwill write down. He recommended a Buy rating for shares of the Standard Chartered with a price target of 1,900 pence.