- Q4 operating income up 7% to $4.0bn
- Q4 underlying profit before tax up 74% to $1.1bn
- Q4 impairment down $232mn to $62mn
- $1bn buyback
Matt Britzman, equity analyst, Hargreaves Lansdown:
“Standard Chartered’s fourth quarter results benefited from lower impairments like many of its peers. Profit before tax beat expectations largely due to a release of impairments back to profit from one of its divisions. Strip that out and underlying performance was a little weaker than expected, but the focus will be on guidance.
The outlook for 2024 is a smidge lower than analysts had priced in but the medium-term guidance out to 2026 shows promising signs. Volume growth, cost cuts and a benefit from the structural hedge are expected to help deliver a return on tangible equity of 12% in 2026 (10% 2023). If delivered, that should provide a material tailwind to the current valuation.
The China story remains in focus. Standard took another write-down of its investment in the domestic Chinese bank, Bohai, over the quarter – taking the total to $850mn for the year. The stark performance difference between onshore and offshore business in China highlights the challenging domestic environment.”
