SCB plans big foreign expansion
Updated: 2008-04-04 07:12
By Hui Ching-hoo(HK Edition)
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Standard Chartered Bank vows to continue its rapid development efforts. Bloomberg |
Standard Chartered Bank (SCB) will maintain its rapid growth to meet investors' expectations this year, although the global economy is still being hit hard by the credit crunch.
Chief Executive Peter Sands said yesterday that it is premature to conclude the subprime crisis has ended, adding that the global economy will stay volatile and more financial institutions will succumb to the financial turbulence.
Posting a 24 percent growth in net profits in 2007, Sands said that the bank will strive to keep its growth momentum this year, but he wouldn't reveal its growth target.
"We know what investors expect us to deliver," Sands said.
He pointed out that the expectation means net profits and income of the bank should maintain in double-digit growth.
To fuel the growth, Sands said the bank will focus on developing its markets in the Middle East, Asia and Africa.
Regarding the impact of the credit woes, he said that the bank's asset-backed securities (ABS) and collateralized debt obligation (CDO) stood at $13 million at the end of January, but the figure was relatively small compared with the group's $4 billion annual profits.
In response to the rumor of acquiring a controlling stake of local lender Wing Lung Bank, Sands said it wasn't appropriate for him to comment, but he noted that organic growth is the bank's primary focus.
As for the South Korea front, he said the setup of a holding company is underway, which is now subject to regulatory approval. "The bank will submit the application in due course," he said.
He added that the holding company in South Korea could provide a broader range of services to customers there.
SCB has made two acquisitions in South Korea - the Yeahreum Mutual Savings Bank in January and Korea First Bank in 2005.
He stressed that being a note-issuing bank is very important to SCB, and it symbolizes the bank's commitment to Hong Kong.
Asked if the bank might lose the status if its largest shareholder, Temasek, raises its shareholding above the 20 percent threshold, Sands declined to comment on the issue, calling it a hypothetical question.
(HK Edition 04/04/2008 page2)