Standard Chartered showed little signs of the banking turmoil in Q1 as profit before tax soared 25% to $1.7bn, and deposits remained stable.
The Asia-focused bank said they had seen no impact on customer deposits which stood at $462bn at the end of the quarter.
Standard Chartered shares were 1.9% at the time of writing on Wednesday. Standard Chartered shares are down 1.2% year-to-date.
“We have delivered another strong set of results in the first quarter of 2023, with income up 13 per cent year-on-year and underlying profit before tax up 25 per cent. Business performance continues to improve across our markets and products and has been achieved in what continues to be an uncertain environment,” said Bill Winters, Group Chief Executive.
“We remain highly liquid and strongly capitalised with a CET1 ratio towards the top of our target range. We remain optimistic about our continued strong performance and expect 2023 income to grow around 10 per cent, the top end of our range, and remain confident in delivering all of our financial targets, including our return on tangible equity targets.”
Standard Chartered did not only shake off any adverse impacts of banking stress in the first quarter, but they also felt confident enough to commit to returning $5bn to shareholders by the end of 2024.
“Standard Chartered is already running a $1 billion buyback and expected to pay out $1.2 billion in dividends across this year and next, but chief executive Bill Winters is now targeting total cash returns to the bank’s shareholders in excess of $5 billion by the end of 2024 – that is around a fifth of the company’s current market capitalisation,” said AJ Bell investment director Russ Mould.
Standard Chartered earns the lion’s share of their income in Asia, and China’s ongoing recovery significantly influenced their profitability. Profits in the region grew 63% in Q1.
Adding to growth in Asia, lower provisions for bad debts in Q1 2023 than in Q1 2022 helped drive higher profit.