The emerging markets-focused lender said underlying pre-tax profit rose to US$2.36bn in the six months ended June 30 from US$1.09bn a year ago as it reached its four-year US$2.9bn gross cost efficiency target six months ahead of plan.
Operating income increased 6% to US$7.6bn, in line with the bank’s medium-term guidance for a 5-7% compound annual growth rate. Growth in wealth management and transaction banking offset lower income from corporate finance and the non-repeat of Treasury gains last year.
StanChar expects RoE to rise further
The group’s return on equity (RoE) improved 150 basis points (bps) to 6.7% and its return on tangible equity rose 170bps to 7.5%.
Standard Chartered said it remains confident it can achieve ROE higher than 8% in the medium term.
The common equity tier 1 (CET1) ratio – a measure of capital strength – edged up 60bps to 14.2%.
An improved financial performance and strong capital position prompted the company to restart its interim dividend at 6p per share.
"The group performed steadily in the first half with encouraging progress on several fronts,” said chief executive Bill Winters.
“Income from key areas of focus continues to grow strongly, we are investing in exciting new initiatives, and our strengthened risk discipline is paying off.”
US-China trade tensions
The company said the results were supported by global economic growth with strong trade flows and investments along with interest rate hikes in the US.
However, it warned that global expansion is becoming "more uneven" amid trade tensions between the US and China.
“Given our history and purpose - to drive commerce and prosperity through our unique diversity - we believe that trade protectionism would be bad for the global economy,” said chairman José Viñals.
“It is, however, worth noting that although the income we make from China's many trade corridors is important for the group, our priorities are those radiating from China in Asia, and along the Belt and Road Initiative routes connecting China with our markets in Africa and the Middle East.”