Wednesday preview: Standard Chartered reports first half interims

Standard Chartered will be in the spotlight on Wednesday as the bank reports its first half results.

The lender is expected to report a drop in pre-tax profit on lower revenues, higher loan losses and an increase in costs.

Analysts expect pre-tax profit to come to $1bn, down from $1.82 billion in the first half of 2015, according to three analyst estimates compiled by The Wall Street Journal. Revenue is forecast to drop to $6.76bn from $8.5bn the previous year.

Deutsche Bank said it expects limited impact from Brexit in the first half given the timing of the results and Standard Chartered’s more emerging markets-focused business mix.

“Instead we expect focus will return again to the revenue outlook – and Brexit is unlikely to be constructive,” Deutsche Bank said.

“We think the long-term valuation of Standard Chartered should be driven by 2018 returns and not further near-term improvements in credit quality or capital. We still struggle to see Standard Chartered making close to cost of equity, forecasting a 5.8% return on tangible equity in 2018 despite an 11% revenue increase by 2018 from current levels.”

The results come a week after the company announced it will appoint senior International Monetary Fund executive José Viñals as its next chairman.

Viñals replaces long-serving chairman Sir John Peace in December. It ends a 17-month search to find a candidate for the top job.

Wednesday 3 August



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