Standard Chartered hits another record

3rd Mar 2010 07:08

Asia-focused bank Standard Chartered said it has decided to pay its executives bonuses after another record year in 2009, with income and profits slightly above market forecasts."We pay for good performance and we do not reward failure. And we have continued to produce record income and profits on a sustained basis. We have increased our capital base, raised our dividend, continued to invest in the business and have generated substantial value for our shareholders over an extended period of time. We have not used government liquidity, capital or asset protection support," chairman John Peace said."On balance, the board has therefore concluded that it is in the interests of the business and our shareholders to reward the management team for yet another successful year and to retain top talent in these fiercely competitive markets, but only when appropriate to do so," he added.Staff at the bank stand to net about £750m in bonus payments with chief executive Peter Sands in line for £2.1m, but reports have said he will defer the payment and anything he does receive will be donated to charity.Profit before taxation in 2009 rose 13% to $5.15bn and operating income increased by 9% to $15.2bn. On a constant currency basis, profit before taxation was up 18% and operating income up 14%. The amount paid to staff totalled 32% of revenues, similar to 2008.Bad debts overall rose to $2.1bn against $1.8bn, with specific loan impairment charges up to $2bn from $1.3bn. The cost to income ratio, or margins, improved from 56.1% in 2008 to 51.3%. Normalised earnings per share increased by 2.8% to 179.8c. Peter Sands added that 2010 has started well for both its retail and wholesale divisions. "For the group as a whole, income and profit were higher than in January 2009 and we started very fast in 2009. The performance in January 2010 is particularly pleasing because we have a better balance between the two businesses, with Consumer Banking a larger relative contributor to total income and client income in Wholesale up strongly," he said.In Consumer Banking, income momentum continues and income is ahead of the underlying run rate for the second half of 2009. The momentum in Wholesale Banking has also continued, he added. Client income had a record month in January and was some 80% of total Wholesale Banking income in the month. The dividend for the year rises to 66c from 61.6c.