Standard Chartered PLC

Q1'24 Results

02 May 2024

Registered in England under company No. 966425

Registered Office: 1 Basinghall Avenue, London, EC2V 5DD, UK

Table of contents

Performance highlights

1

Statement of results

3

Group Chief Financial Officer's review

4

Supplementary financial information

13

Underlying versus reported results reconciliations

24

Risk review

28

Capital review

33

Financial statements

37

Other supplementary information

42

Unless another currency is specified, the word 'dollar' or symbol '$' in this document means US dollar and the word 'cent' or symbol 'c' means one-hundredth of one US dollar.

Unless the context requires, within this document, 'China' refers to the People's Republic of China and, for the purposes of this document only, excludes Hong Kong Special Administrative Region (Hong Kong), Macau Special Administrative Region (Macau) and Taiwan. 'Korea' or 'South Korea' refers to the Republic of Korea.

Within the tables in this report, blank spaces indicate that the number is not disclosed, dashes indicate that the number is zero and nm stands for not meaningful.

Standard Chartered PLC is incorporated in England and Wales with limited liability. Standard Chartered PLC is headquartered in London. The Group's head office provides guidance on governance and regulatory standards. Standard Chartered PLC stock codes are: HKSE 02888 and LSE STAN.LN.

Standard Chartered PLC

Q1'24 Results

Standard Chartered PLC - Results for the first quarter ended 31 March 2024

All figures are presented on an underlying basis and comparisons are made to 2023 on a reported currency basis, unless otherwise stated. A reconciliation of restructuring and other items excluded from underlying results is set out on pages 24-27.

Bill Winters, Group Chief Executive, said:

"We delivered a strong set of results in the first quarter of 2024, with double-digit growth in income and positive operational leverage. Business performance was strong and broad-based across our segments, products and markets in what continues to be an uncertain environment. We have taken action to create a simpler and more efficient organisation with changes to our Group management structure and we are advancing our Fit for Growth programme. We remain confident in the delivery of our financial targets and are maintaining our full year 2024 guidance."

Selected information on Q1'24 financial performance with comparisons to Q1'23 unless otherwise stated

  • Operating income up 17% to $5.2bn, up 20% at constant currency (ccy); up 14% at ccy excluding two notable items of $234m reported in Treasury and Other products
    • Net interest income (NII) up 5% at ccy to $2.4bn with net interest margin of 1.76%, up 6bps quarter-on-quarter (QoQ)
    • Non NII up 37% at ccy to $2.7bn, up 25%, excluding two notable items
    • Markets up 17% at ccy from higher Macro Trading across rates, foreign exchange and commodities and Credit Trading
    • Wealth Solutions up 23% at ccy, with broad-based growth across products and supported by robust leading indicators in Affluent net new money and new to bank clients
    • Banking up 17% at ccy, from Lending & Financial Solutions driven by higher origination and distribution volumes
    • Two notable items of $234m from revaluation of FX positions in Egypt and hyperinflation in Ghana
  • Operating expenses up 6% at ccy to $2.8bn, up 2% QoQ at ccy
  • Income-to-costjaws positive in the quarter
  • Credit impairment charge of $176m in Q1'24, primarily Wealth & Retail Banking (WRB) of $136m reflecting a charge in line with recent quarters; net nil charge for Corporate & Investment Banking (CIB) with China Commercial Real Estate (CRE) portfolio charge of $10m offset by other releases
    • Loan-lossrate (LLR) of 23bps in Q1'24
    • High risk assets of $8.5bn, down $2bn QoQ; $1bn from reversal of existing sovereign exposure from reverse repo to investment securities
    • China CRE portfolio: total expected credit loss provisions $1.2bn, stage 3 exposures of $1.5bn with cover ratio including collateral of 90% and a remaining management overlay of $129m
  • Underlying profit before tax of $2.1bn, up 27% at ccy; reported profit before tax of $1.9bn, up 8% at ccy
  • Tax charge of $0.5bn; underlying effective tax rate of 26%
  • Other items of $112m includes $100m provision in respect of the Korea equity linked securities portfolio
  • Balance sheet remains strong, liquid and well-diversified
    • Loans and advances to customers of $283bn, down $4bn or 1% since 31.12.23; up $4bn or 2% on an underlying basis; growth from CIB partly offset by mortgage headwinds
    • Customer deposits of $459bn, down $10bn or 2% since 31.12.23; down $6bn or 1% at ccy; growth in WRB offset by lower CIB CASA from month end client activity, substantially returned post quarter end
    • Liquidity coverage ratio of 146% (31.12.23: 145%)
  • Risk-weightedassets (RWA) of $252bn, up $8bn or 3% since 31.12.23
    • Credit risk RWA up $2bn includes increases from change in asset mix and model changes, partly offset by lower FX
    • Market risk RWA up $4bn; RWA deployed to help clients capture opportunities in Markets
    • $2bn from mechanically higher Operational risk RWA, due to an increase in average income as measured over a rolling three- year time horizon
  • Capital position remains robust
    • Common equity tier 1 (CET1) ratio of 13.6% (31.3.24) broadly stable post the full impact of the $1 billion share buyback announced in February 2024; underlying profit accretion offset by increased RWAs; around two-thirds of share buyback completed to date
  • Underlying earnings per share (EPS) increased 15.3 cents or 41% to 52.9 cents; Reported EPS increased 5.8 cents or 14% to 46.5 cents

Standard Chartered PLC

1

Q1'24 Results

Standard Chartered PLC - Results for the first quarter ended 31 March 2024

  • Tangible net asset value per share decreased 3 cents to 1,390 cents since 31.12.23; profit accretion offset by reserve movements and full $1bn share buyback reduction from tangible equity, whilst reduction in the number of basic ordinary shares reflects buyback completion of 44% as of 31.3.24
  • Return on tangible equity (RoTE) of 15.2%, up 3%pts

Guidance

The start to the year has been strong and the momentum we see across our businesses gives us confidence in the delivery of our financial targets set out in February. We are maintaining our 2024 guidance:

  • Operating income to increase around the top of 5-7% range in 2024, excluding the two notable items in Q1'24
  • Net interest income for 2024 of $10bn to $10.25bn, at ccy
  • Positive income-to-cost jaws, excluding UK bank levy, at ccy in 2024
  • Low single-digit percentage growth in loans and advances to customers and RWA in 2024
  • Continue to expect LLR to normalise towards the historical through the cycle 30 to 35bps range
  • Continue to operate dynamically within the full 13-14% CET1 ratio target range
  • Continue to increase full-year dividend per share over time
  • RoTE increasing steadily from 10%, targeting 12% in 2026 and to progress thereafter

Standard Chartered PLC

2

Q1'24 Results

Statement of results

Q1'24

Q1'23

Change1

$million

$million

%

Underlying performance

Operating income

5,152

4,396

17

Operating expenses (including UK bank levy)

(2,786)

(2,675)

(4)

Credit impairment

(176)

(26)

nm⁸

Other impairment

(60)

-

nm⁸

(Loss)/Profit from associates and joint ventures

(1)

11

nm⁸

Profit before taxation

2,129

1,706

25

Profit attributable to ordinary shareholders²

1,393

1,076

29

Return on ordinary shareholders' tangible equity (%)

15.2

11.9

330bps

Cost to income ratio (excluding bank levy) (%)

54.1

60.9

680bps

Reported performance7

Operating income

5,130

4,560

13

Operating expenses

(2,997)

(2,750)

(9)

Credit impairment

(165)

(20)

nm⁸

Other impairment

(60)

-

nm⁸

Profit from associates and joint ventures

6

18

nm⁸

Profit before taxation

1,914

1,808

6

Taxation

(519)

(464)

(12)

Profit for the period

1,395

1,344

4

Profit attributable to parent company shareholders

1,403

1,341

5

Profit attributable to ordinary shareholders2

1,223

1,163

5

Return on ordinary shareholders' tangible equity (%)

13.5

13.0

50bps

Cost to income ratio (including bank levy) (%)

58.4

60.3

190bps

Net interest margin (%) (adjusted)6

1.76

1.63

13bps

Balance sheet and capital

Total assets

812,525

820,678

(1)

Total equity

50,839

50,011

2

Average tangible equity attributable to ordinary shareholders²

36,510

36,269

1

Loans and advances to customers

283,403

300,627

(6)

Customer accounts

459,386

462,169

(1)

Risk weighted assets

252,116

250,893

-

Total capital

52,538

52,318

-

Total capital (%)

20.8

20.9

(10)bps

Common Equity Tier 1

34,279

34,402

-

Common Equity Tier 1 ratio (%)

13.6

13.7

(10)bps

Advances-to-deposits ratio (%)3

54.3

56.2

(2.0)

Liquidity coverage ratio (%)

146

161

(15)

Leverage ratio (%)

4.8

4.7

10bps

Information per ordinary share

Cents

Cents

Change1

Earnings per share - underlying4

52.9

37.6

15.3

- reported4

46.5

40.7

5.8

Net asset value per share

1,626

1,505

121

Tangible net asset value per share5

1,390

1,297

93

Number of ordinary shares at period end (millions)

2,610

2,833

(8)

  1. Variance is better/(worse) other than assets, liabilities and risk-weighted assets. Change is percentage points difference between two points rather than percentage change for total capital ratio (%), common equity tier 1 ratio (%), net interest margin (%), advances-to-deposits ratio (%), liquidity coverage ratio (%), leverage ratio (%), cost-to-income ratio
    (%) and return on ordinary shareholders' tangible equity (%). Change is cents difference between two points rather than percentage change for earnings per share, net asset value per share and tangible net asset value per share
  2. Profit attributable to ordinary shareholders is after the deduction of dividends payable to the holders of non-cumulative redeemable preference shares and Additional Tier 1 securities classified as equity
  3. When calculating this ratio, total loans and advances to customers excludes reverse repurchase agreements and other similar secured lending, excludes approved balances held with central banks, confirmed as repayable at the point of stress and includes loans and advances to customers held at fair value through profit and loss. Total customer accounts include customer accounts held at fair value through profit or loss
  4. Represents the underlying or reported earnings divided by the basic weighted average number of shares. Prior period refers to 3 months ended 31.03.23
  5. Calculated on period end net asset value, tangible net asset value and number of shares
  6. Net interest margin is calculated as adjusted net interest income divided by average interest-earning assets, annualised
  7. Reported performance/results within this interim financial report means amounts reported under UK-adopted IAS and EU IFRS. In prior periods Reported performance/results were described as Statutory performance/results
  8. Not meaningful

Standard Chartered PLC

3

Q1'24 Results

Group Chief Financial Officer's review

The Group delivered a strong performance in the first quarter of 2024

Summary of financial performance

Constant

Constant

Q1'24

currency

currency

Q1'23

Change

change¹

Q4'23

Change

change¹

$million

$million

%

%

$million

%

%

Underlying net interest income3

2,419

2,341

3

5

2,392

1

1

Underlying non NII3

2,733

2,055

33

37

1,632

67

68

Underlying operating income

5,152

4,396

17

20

4,024

28

28

Other operating expenses

(2,786)

(2,675)

(4)

(6)

(2,754)

(1)

(2)

UK bank levy

-

-

nm4

nm4

(108)

100

100

Underlying operating expenses

(2,786)

(2,675)

(4)

(6)

(2,862)

3

2

Underlying operating profit before impairment and taxation

2,366

1,721

37

40

1,162

104

102

Credit impairment

(176)

(26)

nm4

nm4

(62)

(184)

(167)

Other impairment

(60)

-

nm4

nm4

(41)

(46)

(50)

Profit from associates and joint ventures

(1)

11

(109)

(109)

(3)

67

67

Underlying profit before taxation

2,129

1,706

25

27

1,056

102

100

Restructuring

(55)

48

nm4

nm4

(63)

13

3

Goodwill & other impairment

-

-

nm4

nm4

(153)

100

100

DVA

(48)

54

(189)

(189)

35

nm4

nm4

Other items

(112)

-

nm4

nm4

262

(143)

(143)

Reported profit before taxation

1,914

1,808

6

8

1,137

68

66

Taxation

(519)

(464)

(12)

(12)

(199)

(161)

(123)

Profit for the period

1,395

1,344

4

6

938

49

52

Net interest margin (%)2

1.76

1.63

13

1.70

6

Underlying return on tangible equity (%)2

15.2

11.9

330

9.4

580

Underlying earnings per share (cents)

52.9

37.6

41

30.4

74

  1. Comparisons presented on the basis of the current period's transactional currency rate, ensuring like-for-like currency rates between the two periods
  2. Change is the basis points (bps) difference between the two periods rather than the percentage change
  3. To be consistent with how we compute Net Interest Margin ('NIM'), and to align with the way we manage our business, we have changed our definition of Underlying net interest income ('NII') and Underlying non NII. The adjustments made to NIM, including interest expense relating to funding our trading book, will now be shown against Underlying non NII rather than Underlying NII. Prior periods have been restated. There is no impact on total income
  4. Not meaningful

Reported financial performance summary

Q1'24

Q1'23

$million

$million

Net interest income

1,572

2,006

Non NII

3,558

2,554

Reported operating income

5,130

4,560

Reported operating expenses

(2,997)

(2,750)

Reported operating profit before impairment and taxation

2,133

1,810

Credit impairment

(165)

(20)

Goodwill & other impairment

(60)

-

Profit from associates and joint ventures

6

18

Reported profit before taxation

1,914

1,808

Taxation

(519)

(464)

Profit/(loss) for the period

1,395

1,344

Reported return on tangible equity (%)2

13.5

13.0

Reported earnings per share (cents)

46.5

40.7

Constant

Constant

currency

currency

Change

change¹

Q4'23

Change

change¹

%

%

$million

%

%

(22)

(20)

1,860

(15)

(16)

39

43

2,509

42

42

13

15

4,369

17

17

(9)

(12)

(3,013)

1

-

18

20

1,356

57

55

nm³

nm³

(55)

nm³

(185)

nm³

nm³

(197)

70

69

(67)

(67)

33

(82)

(82)

6

8

1,137

68

66

(12)

(12)

(199)

(161)

(123)

4

6

938

49

52

50

10.0

350

14

34.0

37

  1. Comparisons presented on the basis of the current period's transactional currency rate, ensuring like-for-like currency rates between the two periods
  2. Change is the basis points (bps) difference between the two periods rather than the percentage change
  3. Not meaningful

Standard Chartered PLC

4

Q1'24 Results

INTERNAL

Group Chief Financial Officer's review continued

The Group delivered a strong performance in the first quarter of 2024. The Group's underlying profit before tax of $2.1 billion was an increase of 27 per cent year-on-year at constant currency. Underlying operating income grew 20 per cent at constant currency to $5.2 billion and was up 14 per cent at constant currency excluding two notable items totalling $234 million relating to gains on revaluation of FX positions in Egypt and a hyperinflationary accounting adjustment in Ghana. Underlying net interest income was up 5 per cent at constant currency, underlying non NII increased 37 per cent or up 25 per cent at constant currency excluding the impact of the two notable items. The net interest margin increased 6 basis points to 176 basis points in the quarter, as the Group benefitted from the one month impact of the roll-off of short-term hedges and improved liability mix. Underlying expenses increased 6 per cent at constant currency driven higher by inflation and business growth initiatives. Income-to-cost jaws were positive in the quarter. Credit impairment charges of $176 million in the quarter were equivalent to an annualised loan-loss rate of 23 basis points and benefitted from a net nil charge in Corporate & Investment Banking (CIB).

The Group remains well capitalised and highly liquid with a diverse and stable deposit base. The liquidity coverage ratio of 146 per cent was 1 percentage point higher on the prior quarter, reflecting disciplined asset and liability management. The common equity tier 1 (CET1) ratio of 13.6 per cent remains robust and stable post the impact of the full $1 billion share buyback announced in February 2024 with profit accretion in the first quarter offset by growth in Risk-weighted assets (RWA)..

All commentary that follows is on an underlying basis and comparisons are made to the equivalent period in 2023 on a reported currency basis, unless otherwise stated.

  • Underlying operating income of $5.2 billion was up 17 per cent or 20 per cent at constant currency driven by strong business activity and the continued benefit of higher interest rates. Excluding the two notable items of $234 million relating to translation gains on revaluation of FX positions in Egypt and a hyperinflationary accounting adjustment in Ghana, income increased 14 per cent at constant currency
  • Underlying net interest income increased 3 per cent, or 5 per cent at constant currency. The net interest margin increased 13 basis points as the Group increased its pricing on assets and the yield on its Treasury portfolio more quickly than it repriced its liability base, reflecting strong pricing discipline and passthrough rate management as interest rates increased in key footprint currencies. The net interest margin also benefitted from a $97 million increase from the roll-off of the loss-makingshort-term hedges. The improvement in margin was in part offset by lower asset volumes, partly due to currency translation
  • Underlying non NII increased 33 per cent driven by strong performances in Wealth Solutions, Banking and Markets as well as the inclusion of two notable items under Treasury and Other income. Excluding the two notable items of $234 million, underlying non NII was up 25 per cent at constant currency. An accounting asymmetry resulting from Treasury management of FX positions also contributed to an increase in underlying non NII, with a partial offset from reduced underlying net interest income
  • Underlying operating expenses increased 4 per cent, or 6 per cent at constant currency. This growth reflected the impact of inflation and the Group's continued investment into business growth initiatives including Wealth & Retail Banking (WRB) relationship managers and CIB capabilities. The Group generated positive income-to-cost jaws of 13 per cent at constant currency
  • Credit impairment was a $176 million charge in the quarter with a $136 million charge in WRB and a $28 million charge in Ventures primarily from Mox. There was a net nil charge in CIB for the quarter as the charges including $10 million relating to the China commercial real estate sector were offset by releases in other parts of the portfolio. The loan-loss rate for the quarter annualises to 23 basis points
  • Other impairment charge of $60 million was related to the write-off of software assets and had no impact on our capital ratios
  • Profit from associates and joint ventures decreased $12 million to a $1 million loss as profits at China Bohai Bank (Bohai) reduced
  • Restructuring, DVA and Other items totalled $215 million. Other items include $100 million provision for participation in a compensation scheme recommended by the Korean Financial Supervisory Service in respect of the Korea equity linked securities (ELS) portfolio. Restructuring charges were $55 million while movements in Debit Valuation Adjustment (DVA) were a negative $48 million
  • Taxation was $519 million on a reported basis, with an underlying effective tax rate of 26.5 per cent compared to the prior year rate of 26.3 per cent
  • Underlying return on tangible equity (RoTE) increased by 330 basis points to 15.2 per cent due to higher profits. On a reported basis, RoTE increased 50 basis points to 13.5 per cent with underlying profits in part offset by a negative movement in DVA and the provision in relation to Korea ELS and Restructuring

Standard Chartered PLC

5

Q1'24 Results

INTERNAL

Group Chief Financial Officer's review continued

Operating income by product2

Constant

Constant

Q1'24

currency

currency

Q1'232

Change

change¹

Q4'232

Change

change¹

$million

$million

%

%

$million

%

%

Transaction Services

1,615

1,572

3

4

1,659

(3)

(3)

Payments and Liquidity

1,161

1,094

6

7

1,207

(4)

(4)

Securities & Prime Services

141

141

-

1

140

1

1

Trade & Working Capital

313

337

(7)

(2)

312

-

-

Banking

472

411

15

17

400

18

18

Lending & Financial Solutions

414

353

17

20

358

16

16

Capital Markets & Advisory

58

58

-

-

42

38

36

Markets

1,041

922

13

17

534

95

97

Macro Trading

884

786

12

16

463

91

93

Credit Trading

167

121

38

44

92

82

84

Valuation & Other Adj

(10)

15

(167)

(171)

(21)

52

47

Wealth Solutions

616

511

21

23

412

50

50

CCPL & Other Unsecured Lending

287

290

(1)

1

288

-

(1)

Deposits

908

803

13

14

933

(3)

(3)

Mortgages & Other Secured Lending

103

161

(36)

(34)

57

81

84

Treasury

43

(233)

118

118

(235)

118

119

Other

67

(41)

nm3

nm3

(24)

nm3

nm3

Total underlying operating income

5,152

4,396

17

20

4,024

28

28

  1. Comparisons presented on the basis of the current period's transactional currency rate, ensuring like-for-like currency rates between the two periods
  2. Products are now presented to reflect the RNS on Presentation of Financial Information issued on 2 April 2024. Prior periods have been restated and there is no change in total income
  3. Not meaningful

The operating income by product commentary that follows is on an underlying basis and comparisons are made to the equivalent period in 2023 on a constant currency basis, unless otherwise stated.

Transaction Services income increased 4 per cent. Payments and Liquidity was up by 7 per cent driven by higher volumes and margin growth from disciplined passthrough rate management in a continued high interest rate environment. This was partly offset by lower Trade & Working Capital income which decreased 2 per cent reflecting margin compression and lower volumes.

Banking income increased 17 per cent as Lending & Financial Solutions grew 20 per cent from higher origination and distribution volumes and increased deal completion leading to improved distribution fee income. Capital Market & Advisory income was stable.

Markets income was up 17 per cent with broad based growth across all products driven primarily by episodic income from market volatility in select geographies whilst Commodities benefitted from higher metals and energy prices.

Wealth Solutions income was up 23 per cent off the back of strong leading indicators with continued momentum in Affluent new to bank client onboarding and net new money which doubled year-on-year to $11 billion. This led to broad-based growth across all products.

CCPL & Other Unsecured Lending income was up 1 per cent with volume growth in Personal Loans in part offset by lower Credit Card fee income.

Deposits income increased 14 per cent from higher volumes in term deposits, and active passthrough rate management in a higher rate environment.

Mortgages & Other Secured Lending income was down 34 per cent on the back of lower mortgage volumes particularly in Korea and Hong Kong, and margin compression which in part reflect the impact of the Best Lending Rate cap in Hong Kong restricting the ability to reprice mortgages despite an increase in funding costs from higher interest rates.

Treasury income increased by $276 million benefitting from $158 million translation gains on revaluation of United States Dollar (USD) FX positions in Egypt. The gains arose as the Egypt branch capital is held in USD but the functional currency is the Egyptian Pound (EGP) which has devalued over time and in accordance with IAS 21 'The Effects of Changes in Foreign Exchange Rates' has resulted in a gain on revaluation of monetary assets and liabilities. The income is offset by a loss in the currency translation reserve resulting in no impact on the Group's capital ratios. Future income adjustments could arise if the EGP exchange rate with the USD continues to move. Treasury also benefitted from the roll-off of short-term hedges which contributed a $97 million increase in income year-on-year. The loss-makingshort-term hedges rolled off in part at the end of February 2023 and the remaining tranche matured at the end of February 2024.

Standard Chartered PLC

6

Q1'24 Results

INTERNAL

Group Chief Financial Officer's review continued

Other products of $67 million include $76 million from Ghana being deemed a hyperinflationary economy for accounting purposes. The results of Ghana operations have been prepared in accordance with IAS 29 'Financial Reporting in Hyperinflationary Economies' as if the economy had always been hyperinflationary. The results of those operations for the period ended 31 March 2024 are stated in terms of current purchasing power using the consumer price index (CPI), with the corresponding adjustment presented in the profit and loss account. In accordance with IAS 21, the results have been translated and presented in USD at the prevailing rate of exchange on 31 March 2024.

Profit before tax by client segment

Constant

Constant

Q1'24

currency

currency

Q1'23

Change

change¹

Q4'23

Change

change¹

$million

$million

%

%

$million

%

%

Corporate & Investment Banking2

1,639

1,485

10

13

1,266

29

28

Wealth & Retail Banking2

729

677

8

8

445

64

61

Ventures

(112)

(103)

(9)

(9)

(133)

16

16

Central & other items

(127)

(353)

64

64

(522)

76

76

Underlying profit before taxation

2,129

1,706

25

27

1,056

102

100

  1. Comparisons presented on the basis of the current period's transactional currency rate, ensuring like-for-like currency rates between the two periods
  2. CCIB and CPBB segments have been renamed to CIB and WRB respectively, to reflect the RNS on Presentation of Financial Information issued on 2 April 2024

The client segment commentary that follows is on an underlying basis and comparisons are made to the equivalent period in 2023 on a constant currency basis, unless otherwise stated.

Corporate & Investment Banking (CIB) profit before taxation increased 13 per cent. Income grew 10 per cent with strong double-digit growth in Markets, from higher episodic income and growth in flow income, and Banking, which benefitted from higher origination and distribution volumes. Expenses were 3 per cent higher with a net nil impairment charge.

Wealth & Retail Banking (WRB) profit before taxation increased 8 per cent, with income up 10 per cent benefitting from the impact of active passthrough management in Deposits and continued strong momentum in Wealth Solutions, partly offset by lower Mortgage income. Expenses increased 4 per cent while credit impairment charge was $74 million higher following a non-repeat of prior year overlay releases.

Ventures loss increased by $9 million to $112 million reflecting the Group's continued investment in transformational digital initiatives. Income increased by $15 million but this was partly offset by an increase in expenses of $11 million. The impairment charge increased $18 million to $28 million reflecting increased bankruptcy related write-offs in Mox and the build-up of expected credit loss provisions as the credit portfolios grew.

Central & other items recorded a loss of $127 million just over one third of the prior period loss. Treasury income increased by $280 million mostly from translation gains on revaluation of FX positions in Egypt of $158 million and benefited from the roll-off of the short-term hedges of $97 million. Other products increased by $93 million of which $76 million is related to a hyperinflationary accounting adjustment in Ghana. Expenses increased by $78 million from project costs and other items that are temporarily held centrally before recharging to client segments, whilst there was a credit impairment charge of $12 million from sovereign-related exposures. Associates income reduced by $17 million reflecting lower profits at Bohai.

Adjusted net interest income and margin

Q1'24

Q1'23

Change¹

Q4'23

Change¹

$million

$million

%

$million

%

Adjusted net interest income2

2,429

2,340

4

2,397

1

Average interest-earning assets

553,710

582,557

(5)

558,183

(1)

Average interest-bearing liabilities

537,161

538,969

-

537,916

-

Gross yield (%)3

5.18

4.37

81

4.98

20

Rate paid (%)3

3.52

2.97

55

3.40

12

Net yield (%)3

1.66

1.40

26

1.58

8

Net interest margin (%)3,4

1.76

1.63

13

1.70

6

  1. Variance is better/(worse) other than assets and liabilities which is increase/(decrease)
  2. Adjusted net interest income is reported net interest income less funding costs for the trading book, financial guarantee fees and others on interest-earning assets
  3. Change is the basis points (bps) difference between the two periods rather than the percentage change
  4. Adjusted net interest income divided by average interest-earning assets, annualised
  5. Not meaningful

Standard Chartered PLC

7

Q1'24 Results

INTERNAL

Group Chief Financial Officer's review continued

Adjusted net interest income increased 4 per cent due to 8 per cent increase in the net interest margin which averaged 176 basis points in the quarter, increasing 13 basis points year-on-year and 6 basis points compared to the prior quarter with a benefit from the one month roll-off of the loss-makingshort-term hedges and improved liabilities mix partly offset by an accounting asymmetry resulting from Treasury management of FX positions.

  • Average interest-earning assets decreased 1 per cent in the quarter primarily from lower Treasury assets. Gross yields increased 20 basis points compared to the prior quarter, benefitting from continued higher interest rates, one month benefit from the roll- off of the short-term hedge and improved mix in part from the roll-off of Treasury assets and Mortgages in WRB
  • Average interest-bearing liabilities were broadly stable on the prior quarter as growth in customer accounts was offset by lower Treasury balances. The rate paid on liabilities increased 12 basis points compared with the average in the prior quarter, reflecting the impact of interest rate movements which were partly offset by an improved liability mix

Credit risk summary

Income Statement (Underlying view)

Q1'24

Q1'23

Change1

Q4'23

Change1

$million

$million

%

$million

%

Total credit impairment charge

176

26

nm3

62

184

Of which stage 1 and 22

61

6

nm3

4

nm3

Of which stage 32

115

20

nm3

58

98

  1. Variance is increase/(decrease) comparing current reporting period to prior reporting periods
  2. Refer to Credit Impairment charge table in Risk review section for reconciliation from underlying to reported credit impairment
  3. Not meaningful

Balance sheet

31.03.24

31.12.23

Change1

31.03.23

Change1

$million

$million

%

$million

%

Gross loans and advances to customers2 Of which stage 1

Of which stage 2

Of which stage 3

Expected credit loss provisions

Of which stage 1

Of which stage 2

Of which stage 3

Net loans and advances to customers Of which stage 1

Of which stage 2

Of which stage 3

Cover ratio of stage 3 before/after collateral (%)3 Credit grade 12 accounts ($million)

Early alerts ($million)

Investment grade corporate exposures (%)3

288,643

292,145

(1)

305,975

(6)

272,133

273,692

(1)

286,335

(5)

9,520

11,225

(15)

12,216

(22)

6,990

7,228

(3)

7,424

(6)

(5,240)

(5,170)

1

(5,348)

(2)

(478)

(430)

11

(507)

(6)

(359)

(420)

(15)

(446)

(20)

(4,403)

(4,320)

2

(4,395)

-

283,403

286,975

(1)

300,627

(6)

271,655

273,262

(1)

285,828

(5)

9,161

10,805

(15)

11,770

(22)

2,587

2,908

(11)

3,029

(15)

63 / 81

60 / 76

3 / 5

59 / 79

4 / 2

1,009

2,155

(53)

1,642

(39)

4,933

5,512

(11)

5,351

(8)

72

73

(1)

75

(3)

  1. Variance is increase/(decrease) comparing current reporting period to prior reporting periods
  2. Includes reverse repurchase agreements and other similar secured lending held at amortised cost of $11,290 million at 31 March 2024, $13,996 million at 31 December 2023 and $14,398 million at 31 March 2023
  3. Change is the percentage points difference between the two points rather than the percentage change

Standard Chartered PLC

8

Q1'24 Results

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Standard Chartered plc published this content on 02 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 02 May 2024 11:52:19 UTC.