LONDON-- Standard Chartered PLC said bad loans jumped by 80% and
pretax profit dived 22% in the first quarter, underscoring the
challenge for incoming Chief Executive Officer Bill Winters to
restructure the bank and improve returns.
In a brief trading update, the bank said bad loans rose to $476
million in the first three months, from $265 million in
first-quarter 2014. It said the quarterly figure marked a drop on
the previous two quarters, although loan impairment from corporate
and institutional clients "remains elevated."
Pretax profit dropped to $1.47 billion from $1.88 billion. The
bank didn't report net figures.
After strong growth for a decade in key markets such as Hong
Kong, Singapore and India, Standard Chartered has faltered in the
past two years as tougher regulation and a weakened global economy
hit its earnings. Many of the bank's senior executives departed,
and Mr. Winters was hired in February to replace long-serving CEO
Peter Sands when he steps down in June.
Mr. Sands on Tuesday said the bank is on track to meet earlier
pledges to raise its regulatory capital ratio, a key measure of
financial strength, to between 11% and 12% this year, and to trim
more than $400 million from its costs.
Standard Chartered, while based in London, makes most of its
revenue in Asia, the Middle East and Africa. It, along with one of
its largest rivals, HSBC Holdings PLC, is contemplating relocating
to Asia to lower its tax bill. A Standard Chartered spokesman said
last week that "we are listening very carefully to our shareholders
views on this issue."
Write to Margot Patrick at margot.patrick@wsj.com
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