Slide 1: Final Results 2007
Final Results 2007 Leading the way in Asia, Africa and the Middle East
Slide 2: Forward looking statements
Forward looking statements It is possible that this presentation could or may contain forward-looking statements that are based on current expectations or beliefs, as well as assumptions about future events. These forward-looking statements can be identified by the fact that they do not relate only
Slide 3: Leading the way in Asia, Africa and the Middle East
Leading the way in Asia, Africa and the Middle East Mervyn Davies Chairman
Slide 4: Performance highlights
Performance highlights Income US$11.07bn 28% Operating profit before tax US$4.04bn 27% Normalised EPS 197.6c 16% Dividend (per share) 79.35c 12%
Slide 5: Asian growth forecast
Asian growth forecast % 2006 2007F* 2008F* China 11.1 11.4 9.5 India 9.6 8.7 8.1 Korea 5.0 4.8 4.5 Hong Kong 6.8 6.1 4.6 Singapore 7.9 7.7 4.5 Malaysia 5.9 6.0 4.2 Indonesia 5.5 6.3 6.0 Vietnam 8.2 8.5 7.5 Taiwan 4.9 5.3 2.7 Thailand 5.1 4.2 4.0 US 2.9 2.2 0.5 UK 2.8 3.1 1.2 Eurozone 2.9 2.6 1.5 Jap
Slide 6: Capturing the opportunities
Capturing the opportunities
Slide 7: Summary
Summary Continued strong performance Breadth and scale Disciplined and vigilant
Slide 8: Leading the way in Asia, Africa and the Middle East
Leading the way in Asia, Africa and the Middle East Richard Meddings Group Finance Director
Slide 9: Group performance
Group performance Underlying US$m 2006 2007 YOY % YOY %* Income 8,620 11,067 28 23 Expenses (4,796) (6,215) 30 24 Operating profit before impairment 3,824 4,852 27 23 Loan impairment (629) (761) 21 (7) Other impairment and loss from associates (17) (56) 229 229 Profit before tax 3,178 4,035 27 27 Pr
Slide 10: Sources of income growth
Sources of income growth US$m 505 11,067 1,122* 11,067 1,942 1,320* 8,620 8,620 2006 Organic Inorganic 2007 2006 Wholesale Consumer 2007 Banking Banking *US$5m of corporate items not allocated
Slide 11: Performance by geography
Performance by geography Profit before tax US$m 2006 2007 YOY % Hong Kong 888 1,193 34 Singapore 289 446 54 Malaysia 178 236 33 Korea 454 324 (29) Other APR 208 572 175 India 403 690 71 MESA 503 591 17 Africa 192 298 55 Americas, UK & Europe 63 (315) nm Total 3,178 4,035 27
Slide 12: China
China Profit before tax US$m 2006 2007 Hong Kong 888 1,193 China 2006 2007 Singapore 289 446 Malaysia 178 236 Income 288 498 Korea 454 324 Profit 107 184 Other APR 208 572 Investment 28 75 India 403 690 MESA 503 591 Outlets 21 38 Africa 192 298 Staff 2,100 4,300 Americas, UK & Europe 63 (315) Total
Slide 13: Consumer Banking performance
Consumer Banking performance Underlying US$m 2006 2007 YOY % YOY %* Income 4,684 5,806 24 15 Expenses (2,641) (3,393) 28 20 Operating profit before impairment 2,043 2,413 18 9 Loan impairment (721) (736) 2 (21) Other impairment (0) (0) Operating profit 1,322 1,677 27 25 *excludes Pakistan, Hsinchu,
Slide 14: Consumer Banking income
Consumer Banking income US$m 2006 2007 YOY % Hong Kong 1,019 1,188 17 Singapore 367 471 28 Malaysia 221 274 24 Korea 1,146 1,142 0 Other APR 729 1,167 60 India 323 408 26 MESA 545 751 38 Africa 257 310 21 Americas, UK & Europe 77 95 23 Total 4,684 5,806 24
Slide 15: Underlying Consumer Banking expenses
Underlying Consumer Banking expenses* US$m 3,003 Up 20% 2,508 Components of expense growth (%) 9 Investment for future growth 4 Regulatory/Control 7 BAU/Volume 20 2006 2007 *excludes Pakistan, Hsinchu, increased stake in Permata, A Brain, Pembroke and Harrison Lovegrove
Slide 16: Consumer Banking loan impairment
Consumer Banking loan impairment US$m 2006 2007 YOY % Individual impairment provision (689) (778) 13 Portfolio impairment provision (32) 42 nm Total impairment charge (721) (736) 2
Slide 17: Wholesale Banking performance
Wholesale Banking performance Underlying US$m 2006 2007 YOY % YOY %* Income 3,923 5,243 34 33 Expenses (2,151) (2,814) 31 29 Operating profit before impairment 1,772 2,429 37 38 Loan impairment 92 (25) nm nm Other impairment (15) (57) 280 280 Operating profit 1,849 2,347 27 28 Risk weighted assets (
Slide 18: Wholesale Banking income
Wholesale Banking income Client income growth Income growth by segment (%) by product (%) Commodity 43 Trade & Lending 23 Corporates Global Cash Management 27 31 Corporates & Custody Financial 38 Global Markets 41 Institutions Local 41 Corporates
Slide 19: Underlying Wholesale Banking expenses
Underlying Wholesale Banking expenses* US$m 2,724 Up 29% 2,114 Components of expense growth (%) 5 Investment for future growth 5 Regulatory/Control 19 BAU/Volume 29 2006 2007 *excludes Pakistan, Hsinchu, increased stake in Permata, A Brain, Pembroke and Harrison Lovegrove
Slide 20: Wholesale Banking loan impairment
Wholesale Banking loan impairment US$m 2006 2007 YOY % Specific impairment provisions (80) (94) 18 Recoveries 170 95 (44) Portfolio impairment provisions 2 (26) nm Total net release/(charge) 92 (25) nm Loans and advances to customers (US$bn)* 62.4 75.3 21 *before portfolio impairment provision
Slide 21: Korea
Korea YOY % US$m 2006 2007 YOY % Adjusted* Income 1,522 1,564 3 15 Expenses (972) (1,146) 18 18 Loan impairment (96) (94) (2) (2) Profit before tax 454 324 (29) 13 *Adjusted for FVAs, accounting asymmetry and dormant accounts
Slide 22: Hsinchu and Pakistan
Hsinchu and Pakistan 2007 Performance US$m Hsinchu Pakistan Income 412 361 Expenses (254) (189) Loan impairment (109) (94) Profit before tax 49 78
Slide 23: Group balance sheet - liabilities
Group balance sheet - liabilities Customer loans to deposits = 86% Deposits US$bn 2006 2007 YOY % CASA 83.1 100.7 21 Time deposits 89.0 104.9 18 Other deposits 5.2 5.6 8 Total 177.4 211.2 19
Slide 24: Exposure to Asset Backed Securities
Exposure to Asset Backed Securities ASG portfolio Ex-Whistlejacket Available Vertical Trading for sale Purchased slice Group US$ m (P&L) (Reserves) (Reserves) (Reserves) Total RMBS US Sub-prime 0 0 0 0 0 US Alt A 6 0 0 90 96 US Prime 0 0 0 2 2 UK/Other 518 83 747 477 1,825 CDOs ABS 0 122 0 169 291 O
Slide 25: Write downs of Asset Backed Securities
Write downs of Asset Backed Securities ASG portfolio Ex-Whistlejacket Available Vertical US$ m Trading for sale Purchased slice 2007 Reserves - (38) (4) (41) P&L (44) (122) - (116) 2008* Reserves - (21) (1) (14) P&L (13) - - - * Movements from 1 January 2008 to 31 January 2008
Slide 26: Capital management
Capital management 20 16.7 15 14.2 13.6 6.9 5.9 5.9 % 10 5 9.8 7.7 8.3 0 2005 2006 2007 Tier 1 Tier 2
Slide 27: Outlook for 2008
Outlook for 2008 Excellent momentum across multiple businesses and geographies Outlook more uncertain Well positioned to capture opportunities
Slide 28: Leading the way in Asia, Africa and the Middle East
Leading the way in Asia, Africa and the Middle East Peter Sands Group Chief Executive
Slide 29: Firm foundations
Firm foundations Strongly liquid Well capitalised Risk discipline Dynamic cost management
Slide 30: Challenges ahead
Challenges ahead Turmoil in financial markets Strains in global economy Political risk Managing rapid growth
Slide 31: Emerging opportunities
Emerging opportunities Hiring good people Taking in deposits Re-pricing and differentiation of risk Deepen client relationships
Slide 32: 2008 agenda
2008 agenda Sustain organic momentum Deliver on acquisitions Continuous improvement Building leadership Reinforce the Brand
Slide 33: Consumer Banking Hong Kong
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Slide 34: Wholesale Banking India
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Slide 35: Nigeria
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Slide 36: The Standard Chartered Private Bank
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Slide 37: Korea, Pakistan and Taiwan
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Slide 38: American Express Bank
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Slide 39: Capability acquisitions
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Slide 40: Outlook for 2008
Outlook for 2008 Chartered ©