Standard Chartered's Middle East profit up 17%

Emerging markets focused bank Standard Chartered reported 17 per cent increase in profit before tax at $3.64 billion (Dh13.3 billion) for the first half of 2011 supported by its robust results across Asia and the Middle East. The bank said its regional performance remained resilient despite the regional uncertainties. Income was up 6 per cent $1.11 billion in the first half of 2011. Although the loan impairment surged 11 per cent year on year, it was down 17 per cent from 2010 year end. Operating profit before tax was up 7 per cent at $429 million. "Our diverse portfolio of 16 geographies in the Middle East and South Asia (MESA) region aids our resilience and benefited us in the first half of 2011, with some geographies like the UAE benefiting from the social unrest in the Middle East and North Africa region," Standard Chartered said in a statement. A key driver of MESA region's performance was the UAE, which accounted for 60 per cent of MESA income and 80 per cent of profit from the region. The UAE operations reported a 12 per cent increase in income over the first half in 2010 Article continues below "We, in the UAE have achieved steady income performance despite challenging market conditions. Our disciplined approach, the diversity of our businesses, our local knowledge and the advantage of a global footprint are giving us a distinct competitive advantage," said Jeremy Parrish, CEO, Standard Chartered UAE. While the commercial banking income surged 10 per cent in the first half of 2011, income from wholesale banking business was 5 per cent in the first half of the year despite the tightening regulatory environment. "We remain in the top five markets globally for the bank which operates in 70 countries, and are a strong regional hub," said Parish. Leading South Asian markets such as Bangladesh and Pakistan that are part of MESA region reported strong income growth of 22 per cent and 10 per cent respectively in the first half of the year. The bank said Wednesday that in the MESA region it has negligible exposure to those countries seriously affected by the political turmoil such as Libya, Egypt, Syria, and Yemen. More hiring on cards Standard Chartered said Wednesday that it will add about 1,000 jobs this year as it picks up the pace of hiring in the coming months after cutting 1,170 jobs in the first six months of the year as it attempted to keep costs under control. That was about 1 per cent of its 84,000 staff. The bank limited cost growth to 8 per cent in the first half, below income growth of 11 per cent, and said it expects cost and income growth to be flat for the full year. Cost growth rising faster than income growth, known as "negative jaws", has dogged Standard Chartered in the past year. Banks opted for jobs cuts to rein in costs. Earlier this week, HSBC announced that will axe 30,000 jobs by 2013.