Empowerment Minister Saviour Kasukuwere told the state-controlled Herald newspaper that Standard Chartered had offered an 'unacceptable' 10 per cent of its operation to locals by the September 25 deadline, according to Reuters.

Barclays Bank is another lender affected by the rule.

Sands said Standard Chartered might miss its goal of a mid-teens return on equity (ROE) by a small margin this year, owing to the issue of new shares last year.

Return on equity is a measure of profit against shareholders' capital. Sands said that in the medium term, the company was still hopeful of a return in the mid-teens.

European banks have recently faced challenges in attracting sufficient funding, with costs of funding rising drastically in recent months. There have been no unsecured debt issues by European banks since the end of May, Sands said.

However, he added that Standard Chartered had no plans for refinancing in the short term.

Based in Britain, the emerging-market-focused lender expected revenue to grow in line with costs and Sands said the bank would stick to its goals of delivering double-digit revenue growth this year.

By the end of last year, Asia contributed nearly 70 per cent of business for Standard Chartered, while Hong Kong accounted for nearly 20 per cent. But the bank had no plans to move headquarters, despite more stringent regulations in the West.

Recently, Asian markets have seen money flowing back to developed economies, as investors try to sell riskier assets in emerging markets. Sands said while Asia would not be immune to the economic volatility in the West, it would continue to generate growth.

The group employed about 85,000 staff at the beginning of the year, Sands said, and expected to hire another 1,000 people by the end of this year.

Sands said Standard Chartered's total sovereign exposure to the euro zone was less than Euro50 million (HK$564.8 million). This was mostly to Britain and the bank had no sovereign exposure to the most distressed European countries.

While Sands remained supportive of the core elements of new banking regulations such as Basel III, he said they could have unintended consequences for jobs and the economy, as it became more expensive for banks to provide credit for customers.

'Policymakers have to [strike] the right balance between making the financial system safer and showing banks can still play their role in supporting economic growth and job creation,' Sands said, adding that inconsistency in implementing details on Basel III between different regions was a challenge for banks.