Standard Chartered PLC (LON:STAN) shrugged off concerns about Hong Kong in the third quarter with a 16% increase in underlying profits.
The Asia-focused bank said there were “growing headwinds from the combination of continuing geopolitical tensions and expectations of declining near-term global growth and interest rates” as it looks to deliver a 10% return on tangible equity by 2021.
In the third quarter of the year, StanChart's return on tangible equity increased by 160 basis points to 8.9%, while underlying pre-tax profit (PBT) hit US$1.2bn and statutory PBT rose 4% to US$1.1bn. Underlying PBT grew 11% in the first half of the year.
Net interest margin, a key measure for banks as it is the difference between interest rates on lending and savings, was down slightly to 1.58% from 1.59% at the half-year but flat since the start of the year.
StanChart chief executive Bill Winters said the growth in profit during the quarter was evidence that the strategy of the last few years “has progressively created a stronger and more resilient business”.
Winters, who last month was said to be the subject of “very difficult” conversations with leading shareholders over his pay after a shareholder revolt over his pension, said that the continuing execution of that strategy was his “priority”.
Growth in the quarter benefited from the 13% income growth in the ASEAN and South Asia region that made up for just 2% growth from Greater China and North Asia, the group’s largest region, though this was an improvement on the 1% decline in the first half.
Africa and the Middle East grew only 2% after a 3% decline in the first half, while Europe and the Americas, the smallest region by income, grew 19% after a 9% fall in the first half.