Chart of darkness

1 November 2016 By George Hay Follow @gfhay

The UK emerging markets bank is making good progress on shedding its worst assets. But with third-quarter revenue only flat on the previous three months, it’s all the more important to hit cost targets. The challenge is doing so without losing more business.

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Standard Chartered’s operating income for the third quarter was $3.5 billion, the same as the second quarter but 6 percent less than the $3.7 billion recorded in the third quarter of 2015, the bank announced on Nov. 1.

Underlying pre-tax profit was $458 million, compared to a $139 million loss in the third quarter of 2015.

The assets in the group’s liquidation portfolio it is running down has fallen to around $6 billion from $20 billion, while the estimated $3 billion of charges associated with the process has not risen.

The group said its top-line performance was driven by a better result in Hong Kong, but a flat performance in ASEAN and South Asia and lower income in Africa, Middle East, Europe and the Americas.

StanChart said the Prudential Regulation Authority had increased StanChart’s so-called Pillar 2A requirement, meaning the group’s minimum core Tier 1 capital ratio in 2019 h risen from 9.2 percent to 9.8 percent. The group is currently at 13 percent.

As of 0945 GMT on Nov.1, StanChart shares were trading at 667 pence, down 6.4 percent.

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