Standard Chartered flags strong first half

25th Jun 2009 10:08

Standard Chartered enjoyed record income and operating profit before tax in the first five months of this year, although the Asia-focused bank remains cautious on the outlook.Its wholesale banking business has had a "very strong" first half to date, with market share and asset margins both increasing. A record first quarter was followed by a "good" April and "even stronger" May, leaving income so far this year "well ahead" of 2008. Singapore, Middle East and South Asia (MESA), Hong Kong and Korea did particularly well. But some of this success has been offset by weakness in consumer banking where income remains under pressure due to "liability margin compression and the impact of muted wealth management sales". Standard expects first half income to be lower than for the second half of 2008, although the second quarter of this year should be better than the first three months of 2009.Investors continue to tread carefully, with demand for investment products still subdued and with no significant improvement overall since the end of 2008.There's also been an increase in impairment levels during the second quarter as customers struggle to see out the global recession."Although there are tentative signs of improving economic conditions in some of our markets, equally there are signs of continuing stress," said chief executive Peter Sands.But Standard said the fundamentals of the group remain "very strong", it is highly liquid, strongly capitalised with a conservative forward funding profile and has a "firm grip" of risks and costs.