Standard Chartered bank's Middle East and South Asia operations recorded a pre-tax operating profit increase of 25 per cent in 2008, outperforming the lender's global accomplishment of a 13 per cent rise.
The bank yesterday said income rose 26 per cent to $13.97 billion (Dh51.2bn) and operating profit before tax (OPBT) 13 per cent to $4.57bn, in what was "a difficult operating environment" particularly in the second half. Almost 80 per cent of the income growth came from organic businesses.
Shayne Nelson, Regional Chief Executive, Standard Chartered Mena, said: "Standard Chartered has seen strong financial performance not only at a group level, but also across the Middle East. Fundamentally we are a different bank with a focus on the emerging markets in Asia, Africa and the Middle East. It is this strategy, combined with our disciplined and conservative approach to managing risk that has ensured revenue and profit growth, while maintaining good levels of liquidity."
The first half of 2008 saw strong economic growth across key markets driven by strong regional trade flows but performance in the second half was dampened as the financial crisis began to have an impact on the real economy across the world, the lender said.
Customer deposits rose 31 per cent during 2008, most of it coming in the last quarter as confidence in financial institutions declined, Standard Chartered said.
Peter Sands, Group Chief Executive, Standard Chartered, said: "We remain open for business and are supporting our clients as they navigate this turmoil. We want to seize the opportunities arising from this turbulence. We have a clear and consistent strategy, and continue to invest for growth."
Most of Standard Chartered's key geographies delivered strong performance with seven of the nine geographic regions recording income of over $1bn in 2008.
Singapore saw OPBT rise 67 per cent, India by 37 per cent, Middle East and South Asia (Mesa) by 25 per cent, Korea by 10 per cent and Africa by five per cent. Hong Kong reported an OPBT decline of 15 per cent as the macroeconomic environment worsened in the latter half of the year.
Group performance was driven by wholesale banking with income growing 43 per cent to $7.49bn and OPBT by 28 per cent to $3bn.
Growth was broad-based across all product categories and geographies, with global markets reporting a 60 per cent jump in income and transaction banking 31 per cent. "The strategy of deepening client relationships paid off with revenues from the top 50 clients rising 45 per cent, while the number of clients with revenues of over $10 million rose 88 per cent," the bank said.
Consumer banking delivered a three per cent growth in income but OPBT declined 33 per cent as the wealth management business slowed sharply in the second half following the slump in Asian equity markets.
Wealth management reported a six per cent income growth in 2008, while SME, another key focus for the business, saw income rising eight per cent.
Loan impairment rose 74 per cent to $1.3bn.
"The group has been taking proactive risk management initiatives which include tightening underwriting criteria, seeking more collateral on loans and improving collections activity," the bank said.
The bank said its focus remains on the emerging economies.