Eastern promise

5 August 2008 By John Foley Follow @johnsfoley

The decoupling of its fortunes from those of its peers, that is. The UK bank delivered a sparkling first half by avoiding the subprime forays and funding gaffes that sank others. StanChart s emerging markets bring their own risks, but investors seem relaxed.

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Standard Chartered reported $2.6bn in pretax profits for the first half of the year, a 31% increase on the same period in 2007. Shares in the UK bank, which is heavily geared towards emerging markets such as China and India, rose 8% on Tuesday (see graph).

StanChart took a $130m expense to reflect writedowns in its holdings of assetbacked securities. The bank's exposure to structured finance weighed in at $5bn, or 1.3% of total assets. It also reported $2.3bn of nonperforming loans, down 1% on the end of 2007.

Mervyn Davies, chairman of Standard Chartered, is a nonexecutive director with Breakingviews.

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