Troubled bank Standard Chartered (LON:STAN) unveiled lower profits and a dividend cut, but shares rose as it reported restructuring progress.
The emerging market-focused group said pre-tax profit in the six months to June 30 fell 44% to US$1.8bn due to adverse loan impairments.
Operating income also dipped 8% to US$8.5bn from the first half last year, driven mainly by currency translation, business divestments and mark-to-market valuations.
The group is restructuring under new chief executive Bill Winters after facing problems such as the commodity price downturn, US regulatory fines and rows with senior investors.
Chairman John Peace said the disappointing earnings and near-term outlook had prompted the group to cut its dividend by half to 14.4 US cents a share.
But he said Standard had improved its capital position and was on track to save more than US$400mln this year.
It also said it had made $219mln from off-loading consumer finance businesses in Hong Kong, China and Korea.
Peace said the group's future domicile was still an area for "external speculation".
He said: "With an estimated bank levy charge of around $500 million for 2015, we welcome Chancellor George Osborne's recent budget announcement on the reduction of the bank levy over the next six years.
"Whilst we are not yet in a position to forecast precisely the combined impact of the reduction in our bank levy costs with the new corporation tax surcharge, our current view is that it will have a material and positive impact."
Winters said: "Today's results show the group has some very real challenges, but they are fixable and it is important to remember that there is a strong business at the heart of Standard Chartered.
"The newly announced management team, together with all of our staff, are determined to get the group back on track."
Shares in the bank rose 7.6p to 960.2p.
Shore Capital said Standard's profits were significantly lower than it had expected and he impairment outlook remained a key area of uncertainty.
But the broker said the significant improvement in capitalisation meant the possibility of a capital raising had diminished.
"We think this is the key factor behind the positive share price reaction to, what on the face of it, looks like a poor set of results," Shore Capital said.
"Management remains cautious on the near-term prospects for the group, highlighting the challenges that it is currently facing, albeit noting that it believes these are fixable and that the medium-long term opportunities growth remain compelling.
"We agree with this sentiment, which is a key plank of our positive investment case."