Standard Chartered keen to grow branch numbers on mainland China
Bank passes US1b in mainland income and says it wants more staff and more branches there
Standard Chartered is keen to invest more on the mainland on new branches and staff recruitment.
Peter Sands, the chief executive of the British bank, said the mainland would be one of the drivers for the group in the coming years.
For the first time last year, Standard Chartered recorded US$1 billion in income from its operation on the mainland, where it has 100 branches.
Sands refused to give a specific target on the number of new staff or branches the bank plans, saying only that the group would continue to invest across the mainland. He said he expected the income from mainland operations to grow at double digit rates, in keeping with the growth of the rest of the group.
While banks in Hong Kong such as Bank of East Asia and Wing Hang Bank have made substantial provisions for bad loans on the mainland, Sands said there were "challenges" in some sectors but Standard Chartered was "comfortable" with the asset quality of its mainland loans.
Two thirds of the group's income came from Asia last year. Currency depreciation had been "a headwind" in previous years, but depreciation of Asian currencies would be a lesser threat to the group's income this year, Sands said.
Standard Chartered had a good start this year after a costly settlement with US regulatory bodies last year. Sands would not comment on whether such costs would reappear, but he said there were other regulatory issues, such as bank levies and the capital requirements needed to follow Basel III standards, that might affect the group.
Standard Chartered maintained a "good relationship and communication" with Temasek, Singapore's state-owned investment company, which holds 17.93 per cent stake in the bank, Sands said. He refused to comment on whether it was considering selling its stake.
He said the bank remained on target for a double-digit income growth and a return on equity at "mid-teens level".
Sands said the bank was worried about the proposal for a bonus cap for bankers currently being debated by the European Union, though some 97 per cent of its staff are located outside Europe. However, he said, the group had no plan to change its domicile from Britain.