Slide 1: Final Results 2008
Final Results 2008 Leading the way in Asia, Africa and the Middle East 1
Slide 2: Forward looking statements
Forward looking statements This presentation contains or incorporates by reference ‘forward-looking statements’ regarding the belief or current expectations of Standard Chartered, the Directors and other members of its senior management about the Company’s businesses and the transactions described i
Slide 3: Leading the way in Asia, Africa and the Middle East - John Peace
Leading the way in Asia, Africa and the Middle East John Peace Acting Chairman 3
Slide 4: Performance highlights
Performance highlights Income US$13.97bn 26% Operating profit US$4.57bn 13% Normalised EPS 174.9c 1% Dividend (per share)* 61.62c 3% Tier 1 capital 10.1% *Dividend per share has been restated for the impact of the rights issue 4
Slide 5: Summary
Summary Disciplined execution of strategy Focused on the basics of banking Supporting clients’ needs Embedded values and culture 5
Slide 6: Leading the way - Richard Meddings
Leading the way in Asia, Africa and the Middle East Richard Meddings Group Finance Director 6
Slide 7: Group performance
Group performance Underlying US$m 2007 2008 YOY % YOY %* Income 11,067 13,968 26 21 Expenses (6,215) (7,611) 22 13 Operating profit before impairment 4,852 6,357 31 32 Loan impairment (761) (1,321) 74 64 Other impairment (57) (469) nm nm Profit from associates 1 1 Operating Profit 4,035 4,568 13 16
Slide 8: Restated performance metrics
Restated performance metrics Pre rights Post rights 2007 2008 2007 2008 Normalised EPS (cents) 197.6 201.0 173.0 174.9 DPS (cents) 79.35 81.97 59.65 61.62 Normalised ROE (%) 15.6 15.2 15.6 15.2 8
Slide 9: Group balance sheet
Group balance sheet FY H1 H2 2007 2008 2008 Total deposits US$bn 211.2 251.2 274.6 A/D ratio %* 86 84 75 Liquidity ratio % 23.9 22.8 23.1 Total assets US$bn 329.9 396.7 435.1 *Ratio of customer loans to customer deposits 9
Slide 10: Capital
Capital 18 16 15.6 14.9 14 5.5 12 6.4 10 % 2.5 8 2.4 6 Tier 1 Tier 1 10.1 4 8.5 7.6 6.1 2 0 H1 2008 FY 2008 reported Core Tier 1 Tier 2 and 3 10
Slide 11: Performance by geography
Performance by geography Profit before tax US$m 2007 2008 YOY % Hong Kong 1,193 1,014 (15) Singapore 446 744 67 Malaysia 236 235 (0) Korea 324 358 10 Other APR 572 463 (19) India 690 943 37 MESA 591 736 25 Africa 298 312 5 Americas, UK & Europe (315) (237) 25 Total 4,035 4,568 13 11
Slide 12: Consumer Banking performance
Consumer Banking performance Underlying US$m 2007 2008 YOY % YOY %* Income 5,806 5,952 3 (2) Expenses (3,393) (3,843) 13 3 Operating profit before impairment 2,413 2,109 (13) (9) Loan impairment (736) (937) 27 18 Other impairment 0 (56) nm nm Operating profit 1,677 1,116 (33) (25) *Excludes American
Slide 13: Wealth Management income
Wealth Management income* Structured deposits PCI** FX Structured notes Insurance Unit trusts Q1 2008 Q2 2008 Q3 2008 Q4 2008 *Indexed to Q1 2008 total **PCI - Premium currency investments 13
Slide 14: Underlying Consumer Banking expenses
Underlying Consumer Banking expenses* US$m 1,798 1,800 1,781 1,700 1,694 (6%) 1,600 1,500 H2 2007 H1 2008 H2 2008 *Excludes American Express Bank 14
Slide 15: Consumer Banking loan impairment
Consumer Banking loan impairment US$m H2 FY H1 H2 FY YOY 2007 2007 2008 2008 2008 % Individual impairment provision (381) (777) (416) (482) (898) 16 Portfolio impairment provision 17 41 4 (43) (39) nm Total impairment charge (364) (736) (412) (525) (937) 27 15
Slide 16: Consumer Banking loan impairment trend
Consumer Banking loan impairment trend FY07 Q1 08 Q2 08 Q3 08 Q4 08 FY08 Mortgages LI/ANR 0.07% 0.08% 0.04% 0.00% 0.05% 0.04% 30dpd/ENR 1.02% 1.21% 1.17% 1.20% 1.34% 1.34% Loan book (US$bn) 50.4 50.1 49.6 46.7 47.6 47.6 LI (US$m) 35.7 10.0 5.7 0.4 6.0 22.1 SME LI/ANR 0.81% 1.26% 1.34% 1.21% 2.75% 1.
Slide 17: Wholesale Banking performance
Wholesale Banking performance Underlying US$m 2007 2008 YOY % YOY %* Income 5,243 7,489 43 37 Expenses (2,814) (3,768) 34 25 Operating profit before impairment 2,429 3,721 53 52 Loan impairment (25) (384) nm nm Other impairment (57) (336) nm nm Operating profit 2,347 3,001 28 27 Risk weighted assets
Slide 18: Wholesale Banking income
Wholesale Banking income Client income growth Income growth by segment (%) by product (%) Lending & portfolio Global Corporates 25 3 management Transaction Financial Institutions 40 31 banking Local Corporates 31 Global Markets 60 Commodity Traders 69 18
Slide 19: Diversified income streams
Diversified income streams Total revenues by product US$ m 2007 2008 YOY % Lending & Portfolio Mgt 537 551 3 Transaction Banking 2,033 2,663 31 Trade 699 1,023 46 Cash Mgt & Custody 1,334 1,640 23 Global Markets 2,673 4,275 60 Financial Markets 1,323 2,365 79 ALM 496 912 84 Corporate Finance 454 745
Slide 20: Wholesale Banking Financial Markets
Wholesale Banking Financial Markets Financial Markets Product breakdown 2007 2008 YOY % US$ m FX 1,017 1,194 17 Rates 158 748 373 Commodities and Equities 49 141 188 Capital Markets 259 234 (10) Credit and Other (160) 48 nm Total Financial Markets 1,323 2,365 79 20
Slide 21: Wholesale Banking loan impairment
Wholesale Banking loan impairment US$m 2007 2008 YOY % Specific impairment provision (94) (394) 319 Recoveries 95 89 (6) Portfolio impairment provision (26) (79) 204 Total net charge (25) (384) nm Loans and advances to customers (US$bn)* 75.3 98.5 31 *Before portfolio impairment provision 21
Slide 22: Other impairment
Other impairment US$m 2007 2008 Asset Backed Securities (35) (41) Equity investments 0 (357) Other (22) (71) Total (57) (469) 22
Slide 23: Korea
Korea YOY% YOY% headline constant US$m 2007 2008 currency Income 1,564 1,576 1 18 Expenses (1,146) (955) (17) (1) Loan impairment (94) (263) 180 233 Operating profit before tax 324 358 10 23 23
Slide 24: Taiwan
Taiwan US$m 2007 2008 YOY% Income 608 642 6 Expenses (361) (402) 11 Loan impairment (159) (158) (1) Operating profit before tax 88 82 (7) 24
Slide 25: American Express Bank
American Express Bank 2008 Performance US$m CB WB Total Income 270 282 552 Expenses (266) (180) (446) Loan/other impairment* (68) (6) (73) Profit pre integration expense (64) 96 33 Integration expense (85) (72) (157) Profit before tax (149) 24 (124) *Includes US$1m profit from associates not allocat
Slide 26: Group balance sheet - liabilities
Group balance sheet - liabilities Deposits FY H1 H2 US$bn 2007 2008 2008 YOY % CASA* 100.7 113.2 117.3 16 Time deposits 104.9 131.3 145.2 38 Other deposits 5.6 6.7 12.1 116 Total 211.2 251.2 274.6 30 *CASA - Current and savings accounts 26
Slide 27: Group balance sheet - assets
Group balance sheet - assets FY FY YOY US$bn 2007 2008 % Wholesale loans to customers 75.3 98.5 31 Consumer loans to customers 82.3 80.7 (2) Derivatives 26.2 69.7 166 Loans and advances to banks 35.4 46.6 32 Assets held at Fair Value 20.3 11.1 (45) Investment securities 55.3 69.3 25 Cash at central
Slide 28: Exposure to Asset Backed Securities
Exposure to Asset Backed Securities Carrying Average Average Notional Notional value mark mark US$m 2007 2008 2008 Q3** Q4** RMBS US Sub-prime 0 0 0 US Alt A 96 84 57 57 42 US Prime 2 2 1 46 17 UK/Other 1,825 1,024 969 94 84 CDOs ABS 291 208 32 19 14 Other CDOs 418 379 306 73 59 CMBS US CMBS 159 147
Slide 29: Summary
Summary Global economic outlook is uncertain Good momentum Strongly liquid and well capitalised 29
Slide 30: Leading the way - Peter Sands
Leading the way in Asia, Africa and the Middle East Peter Sands Group Chief Executive 30
Slide 31: Fundamentals
Fundamentals Disciplined execution of strategy Focused on the basics of banking Supporting clients’ needs Embedded values and culture 31
Slide 32: Liquidity
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Slide 33: Capital
Capital % 8.5 0.3 8.0 0.8 (0.5) (0.2) 7.5 (0.2) 7.0 1.3 6.5 7.6 6.0 5.5 6.1 5.0 Jun 2008 Rights Profit RWA Structural Dividend EL and Dec 2008 core tier 1 issue movements FX other core tier 1 33
Slide 34: Risk Weighted Assets
Risk Weighted Assets US$bn US$bn 204 204 185 18 189 185 189 14 12 18 8 9 132 148 137 163 174 162 53 56 52 FY 2007 H1 2008 FY 2008 FY 2007 H1 2008 FY 2008 Credit Market Operational Consumer Wholesale risk risk risk Banking Banking 34
Slide 35: Risk management
Risk management Wholesale Banking Consumer Banking Maturity profile Collateralisation >5 years 6% Unsecured c.20% 1-5 years 22% < 1 year 72% Secured c.80% 35
Slide 36: Operational risk
Operational risk Chartered
Slide 37: Cost management
Cost management Consumer Banking Wholesale Banking US$m US$m 1,961 1,882 1,939 1,829 (4%) (6%) H1 2008 H2 2008 H1 2008 H2 2008 37
Slide 38: Economic environment
Economic environment GDP % 2007 2008F* 2009F* 2010F* China 11.9 9.0 6.8 8.0 India** 9.0 6.3 5.0 6.8 Korea 5.0 2.5 (2.5) 2.6 Hong Kong 6.4 2.5 (1.8) 4.0 Singapore 7.8 1.1 (3.9) 3.0 Malaysia 6.3 4.8 (0.8) 2.8 Indonesia 6.3 6.1 4.0 5.5 Vietnam 8.5 6.2 4.2 5.5 Taiwan 5.7 0.1 (1.5) 3.2 Thailand 4.8 3.1 0
Slide 39: Strategy
Standard St rategy Chartered R Standard Q& Standard @& Chartered &Q ey. paseo STEERING BUSINESS WHILE SERVING COMMUNITIES fe STRIKING THE RIGHT BALANCE FOR OVER 180 YEARS. ANCE FoR OVER 160 YEARS Standard @& Standard @& Chartered &Q Chartered © HUMANISING SERVICE WHILE OPTIMISING TECHNOLOGY
Slide 40: Wholesale Banking
Wholesale Banking Revenues from top No. of clients generating 50 clients annualised revenues >US$10m 88% 45% FY07 FY08 FY07 FY08 40
Slide 41: Consumer Banking
Cons u . mer Banking Standard QS Chartered &Q ses the mm maxim terest nt propert H ly tomorrow. Link muttiple home loans and deposit accounts Paymenton unds your home loan deposit account
Slide 42: One bank
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Slide 43: Summary
Summary Global economic outlook is uncertain Good momentum Strongly liquid and well capitalised 43