Financial News

  • 27 June 2014, 7:47

Standard Chartered First-Half Profit Warning

Standard Chartered has warned of another profit fall, amid tighter banking regulation and lower market volatility.

In a trading update it said first-half profit dropped by a fifth - making it the second year in a row of declining earnings.

It said revenues in the first half of this year would be down by between 3% to 7% on last year's figures, with losses from bad loans up by around 17%.

Shares in Standard Chartered were down more than 4.2% in mid-afternoon trades on Thursday - taking them to their lowest level for two years.

Although based in London, Standard Chartered makes more than 75% of its profit from a large footprint in Asia, Africa and the Middle East.

The emerging market focus helped the bank avoid much of the damage wrought on banks in G7 locations.

However, in addition to tightening regulations affecting profit, it has recently suffered big losses in South Korea and a slowdown across Asia.

Last year, the bank announced its first drop in full-year profit for a decade.

Forecasts for this year were for a 4% profit rise to about 4.2bn.

Equities, foreign exchange, commodities, and other capital markets activities have been hit by the profit decline.

Standard Chartered and rivals have suffered trading volume slumps since mid-2013 as low interest rates affect business and rising capital-holding ratios.

The bank also confirmed the head of its financial markets arm, Lenny Feder, would take a one-year sabbatical.

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