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Standard Chartered PLC on Friday launched a new $1 billion share buyback programme, as it reported a 20% rise in profit in the first half of 2023 and raised its guidance for the full year.
The London-based, Asia-focused bank said it is ‘strongly profitable, highly liquid, and well capitalised’.
Pretax profit in the six months that ended June 30 was $3.32 billion, up 20% from $2.77 billion a year before. Operating income increased by 11% to $9.13 billion from $8.23 billion, and StanChart also benefitted from a reduced credit impairment of $161 million, down from $263 million a year before.
Net interest income rose by 35% at constant currency to $4.8 billion and net interest margin averaged 1.67%, widened by 35 basis points. In the second quarter alone, NIM widened by 8 basis points to 1.71%, mostly thanks to rising interest rates, but also as hedges rolled off, StanChart said.
Return on tangible equity was 12.0% in the first half, up three percentage points from a year before. It was 12.1% in the second quarter alone, up four points. Cost-to-income ratio improved to 62.1% in the first half from 64.8% a year before.
Looking ahead to all of 2023, StanChart said it expects income to increase by 12% to 14% at constant currency. It expects net interest margin to average about 170 basis points over the full year, and it expects a return on tangible equity of 10%.
StanChart declared a 6 cents per share ordinary interim dividend, up 50% from a year before. It also immediately launched a new share buyback worth $1.0 billion, running alongside its current programme. The bank has a market capitalisation of just under £20 billion.
StanChart shares were down 0.1% at HK$71.65 in Hong Kong on Friday afternoon, following the announcement.
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