LON­DON

Bri­tain’s sec­ond-largest lender by mar­ket value pre­tax profit rose to $6.88 bil­lion in 2012 from $6.78bn in 2011

The Pak Banker - - FRONT PAGE -

Stan­dard Char­tered Plc, Bri­tain’s sec­ond-largest lender by mar­ket value, cut bonuses by 7 per cent and boosted its div­i­dend af­ter it was fined $667 mil­lion for US sanc­tions vi­o­la­tions.

The bank will pay a fi­nal div­i­dend of 56.77 cents a share, bring­ing the to­tal for the year to 84 cents, 11 per­cent more than in 2011, the Lon­don-based lender said in a state­ment to­day. Pre­tax profit rose to $6.88 bil­lion from $6.78 bil­lion in 2011, beat­ing the $6.84 bil­lion es­ti­mate of 23 an­a­lysts sur­veyed by me­dia and mark­ing the firm’s 10th con­sec­u­tive year of record profit. Rev­enue ad­vanced 8 per­cent to $19.1 bil­lion.

Jim An­tos, a Hong Kong­based an­a­lyst at Mizuho Se­cu­ri­ties Asia Ltd., talks about the fi­nan­cial re­sults and busi­ness out­look for HSBC Hold­ings Plc and Stan­dard Char­tered Plc. HSBC posted a de­cline in full-year profit af­ter paying a record penalty for com­pli­ance fail­ures and said costs rose for a third year, miss­ing its tar­get.

Chief Ex­ec­u­tive Of­fi­cer Peter Sands is try­ing to at­tain rev­enue growth of at least 10 per­cent, while keep­ing ex­penses un­der con­trol as it hires and adds branches in China and Africa.

Chief Ex­ec­u­tive Of­fi­cer Peter Sands, 51, is try­ing to at­tain rev­enue growth of at least 10 per­cent, while keep­ing ex­penses un­der con­trol as it hires and adds branches in China and Africa. The bank, which gets most of its profit from Asia, last year reached a set­tle­ment with U.S. reg­u­la­tors over al­le­ga­tions the bank vi­o­lated U.S. sanc­tions with Iran. The “amount paid in bonuses is less than the amount paid to our share­hold­ers by way of a div­i­dend, less than cor­po­rate tax­a­tion and well un­der half of the re­tained earn­ings,” Sands said in to­day’s state­ment. “We have started the year with very good mo­men­tum and an ex­cep­tion­ally strong bal­ance sheet.”

The lender was in Au­gust ac­cused by Ben­jamin Lawsky, head of the New York De­part­ment of Fi­nan­cial Ser­vices, of help­ing Iran laun­der about $250 bil­lion in vi­o­la­tion of fed­eral laws, keep­ing false records and han­dling lu­cra- tive wire clients.

Sands told re­porters on a call to­day that the firm re­duced the bonus pool to $1.43 bil­lion from $1.54 bil­lion. Bonuses for Sands and Fi­nance Di­rec­tor Richard Med­dings fell 10 per­cent to $3.15 mil­lion and $2.16 mil­lion re­spec­tively. Stan­dard Char­tered rose as much as 4.1 per­cent and was up al­most 3 per­cent at 1,832.5 pence at 9:35 a.m. in Lon­don, valu­ing the bank at about 44 bil­lion pounds ($67 bil­lion). The stock is up 16.5 per­cent this year, mak­ing it the best per­former among Bri­tain’s five big­gest lenders.

Stan­dard Char­tered, whose ori­gins date to 19th cen­tury Bri­tish colo­nial rule in Africa and In­dia, earns more than three quar­ters of

trans­fers

for

Ira­nian its profit from cor­po­rate bank­ing. Op­er­at­ing profit at the di­vi­sion, led by Michael Rees, de­clined 1.5 per­cent to $5.14 bil­lion af­ter the fine. Rev­enue at the di­vi­sion in­creased 8.6 per­cent to $11.78 bil­lion. Profit from con­sumer bank­ing, run by Steve Ber­tamini, climbed 7.8 per­cent last year to $1.78 bil­lion, the lender said to­day.

“Con­sumer was a lit­tle bit bet­ter than we ex­pected and whole­sale a lit­tle bit worse,” said Gary Green­wood, a bank­ing an­a­lyst at Shore Cap­i­tal Ltd. who rates the lender a buy. “The out­looks state­ment looks pretty con­fi­dent — they talk about very good mo­men­tum into the new year and how they’re tak­ing mar­ket share.” Op­er­at­ing costs for the bank rose to $10.9 bil­lion from $9.9 bil­lion.

Lon­don-based com­peti­tor HSBC Hold­ings Plc (HSBA) yes­ter­day said full- year profit de­clined af­ter it paid a record penalty for com­pli­ance fail­ures and said costs rose for a third year, miss­ing its tar­get. Pre­tax profit for 2012 dropped 5.6 per­cent to $20.65 bil­lion.

Lloyds Bank­ing Group Plc and Royal Bank of Scot­land Plc, Bri­tain’s two big­gest gov­ern­men­towned banks, posted net losses for the year last week as they set aside a com­bined 2.9 bil­lion pounds re­lated wrongly sold loan in­surance and in­ter­est- rate-hedg­ing prod­ucts. Bar­clays Plc posted its first loss in two decades last month and set aside an ad­di­tional 1 bil­lion pounds to com­pen­sate clients.

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