home Advertise
With Us

StanChart India H1 operating profit up 45%

MUMBAI: Standard Chartered Bank India on Tuesday posted a 45% jump in operating profit for the first half of the year at $450 million, compared with $311 million a year ago, on the back of robust growth in income from retail and corporate lending. 

The Indian unit of the Asia-focused British bank said income from Indian branches rose 17% to $927 million during the January-June 2013 period from $790 million a year go. India continues to be the number three contributor to StanChart's global revenues. 

"Foreign exchange volatility has been a 5% drag on profitability and has affected the balance sheet by about 8%. The macroeconomic environment is expected to remain challenging, but the momentum is good in the second half," said Sunil Kaushal, regional chief executive, India & 
South Asia, Standard Chartered Bank. 

"Loan impairments have increased in the consumer and corporate banking portfolio. On the consumer banking side, bad loans saw an increase on account of acquisition of an unsecured loan portfolio. On the corporate banking side, the bank had to take specific charges on account of some small exposures," said Kaushal. 

Loan impairment has increased to $113 million in the first half of 2013 from $105 million a year ago. The consumer banking business of the bank grew about 15% while the wholesale banking business grew 10%. The gross non-performing loans of the bank increased to $917 million in the first half of 2013 from $819 million a year ago. 

"In the second half, we are cautiously optimistic as the currency is volatile. High interest rates are expected to further affect corporate banking activity. We are not seeing any new capex investment... activity comes from re-pricing of high cost debt, cross border and trade flows," he said. "There are first signs of job losses and delay in salary payments, this could impact repayment capacities of retail borrowers," said Kaushal.