StanChart poised for slowing growth

Standard Chartered's decade of rising earnings is expected to come to an end when the emerging-markets-focused British bank delivers its results for last year on Wednesday.

Pre-tax profit is forecast to fall 2.4 per cent to US$6.71 billion, according to the average analysts' estimate in a Bloomberg poll, which also drew on management guidance in December of flat income growth for last year.

The analysts are looking to stronger growth momentum as the bank benefits from a restructuring that started this year, but remain concerned about its capital strength.

Standard Chartered, with its reliance on earnings from emerging markets, has suffered as a result of the United States Federal Reserve's tapering of its quantitative easing programme, which prompted an outflow of capital from these high-growth regions. The shifts in capital to developed markets had led to higher impairment charges for the second half, the bank said in December.

The London-based bank, which generates more than 75 per cent of its profit from Asia, the Middle East and Africa, expects slower growth and plans to reduce costs in a bid to raise profitability. It made a pre-tax profit of US$3.3 billion in the first half of last year, down 15.3 per cent from 2012.

"The bank should report a concrete plan on cost savings [in the results announcement]," said Dominic Chan, an analyst at BNP Paribas. "This is the fastest way for the bank to reap benefits."