Standard Chartered: nine straight years of profitability

A continuing focus on the rest of the world again pays off big for Standard Chartered plc.

Headquartered in London but deriving 90% of its profits and income from Asia, Africa, and the Middle East, StanChart reported a net profit of US$17.64 billion in 2011, 12% higher than 2010. In a notification to the Hong Kong stock exchange, it said its annual profit before tax was US$6.8 billion, up 11% year-on-year.

Greater China, which includes Hong Kong, Mainland China and Taiwan, accounted for profits of US$2.1 billion, up 46% from 2010.

It represented 25% of the group's total income and 31% of total profits despite losses of some US$100 million in mainland consumer banking.

It was the ninth straight year of record income and profit for StanChart. Its continuing emphasis on developing markets offset mounting problems in Europe and the USA that are struggling to recover from the global financial crisis.

"Taken as a whole, emerging Asia should continue to grow at mid- to high single-digit rates - slower than before the crisis, but still much faster than the West," said Peter Sands, Chief Executive Officer.

"This sharp polarisation in economic performance and prospects is one reason different banks are in such different positions."

"All of us face the challenge of the ongoing avalanche of regulation. None of us can be complacent about the continuing fragility of the system," Sands said.

He expected double-digit income growth in the medium term but warned that an ever more complex set of regulatory requirements linked to capital adequacy requirements could act as a drag on earnings and costs.

Nevertheless, StanChart is supportive of the Basel III reforms intended to buttress the global financial system against a repeat of the 2007-2008 collapse