Standard Chartered Reports 5.5% Rise in Q1 Profit, Beats Estimates

Standard Chartered PLC reported a 5.5% increase in its first-quarter 2024 pretax profit to $1.91 billion, surpassing analysts' estimates. The emerging markets-focused lender attributed the strong performance to higher interest rates, which bolstered its earnings.

The bank's statutory pretax profit in the quarter was $1.91 billion, compared to $1.81 billion a year earlier and the $1.39 billion average of 13 analyst estimates. Standard Chartered, which generates most of its revenues in Asia, saw its earnings benefit from the rising interest rate environment.

Why this matters: Standard Chartered's better-than-expected results highlight the positive impact of higher interest rates on the banking sector. The lender's strong performance in emerging markets, particularly Asia, underscores the region's economic resilience and growth potential.

However, the bank also faced some challenges in the quarter. Credit impairments worsened in 2023, with a $165 million writedown in the first three months, compared to $20 million a year earlier. Standard Chartered also saw a decline in profit from its joint ventures, particularly its stake in China's Bohai Bank, which was impacted by the slowing Chinese economy and the crisis in the country's property sector.

Despite these headwinds, Standard Chartered's Chief Executive Bill Winters expressed confidence in the bank's outlook. "Our first quarter performance was strong despite the volatile macro environment," Winters said in a statement. "We are well-positioned to deliver sustainable growth and returns over the long term."

Key Takeaways

• Standard Chartered's Q1 2024 pretax profit rose 5.5% to $1.91B, beating estimates.
• Higher interest rates boosted the bank's earnings, particularly in its Asian markets.
• Credit impairments worsened, and profits from its China joint venture declined.
• Despite headwinds, the CEO expressed confidence in the bank's long-term growth outlook.
• The results highlight the positive impact of higher rates on the banking sector.