Rise in profits for banking firm offset by staff cost hike
Asian-facing bank Standard Chartered reported a 19% hike in annual profits, but revealed sharply higher staff costs as it fights a "war for talent" in its key Asian markets.
The London-based group reported pre-tax profits of $6.1 billion (£3.7bn), up from $5.2bn (£3.2bn) in 2009, helped by the industry-wide trend for sharply lower bad debt losses. It said 2011 had got off to a record start thanks to its focus on some of the world's fastest-growing markets.
The group confirmed a "modest" increase in its bonus pool - to $1.19bn (£730m) from $1.1bn (£674m) in 2009 - after hitting another all-time high with its 2010 profits haul. However, a 17% hike in staff costs pushed operating expenses up as the group fights to hire top bankers in ultra-competitive Asian markets.
The group, which did not call on the Government for support in the financial crisis, also raised concerns over the impact of the UK's new bank tax, echoing comments made by fellow emerging market player HSBC earlier this week.
Standard said the levy will cost it around $180m (£110m) post tax in 2011 and cautioned over a lack of co-ordinated action on worldwide banking regulations, which poses a headache for banks with international operations.
Peter Sands, group chief executive, said: "The biggest external challenge we face is regulation.
"Whilst we are broadly supportive of much of the regulatory reform agenda, the sheer scale of actual and potential changes, when applied across all the markets we operate in, represents a very considerable challenge and there is the real risk of unintended consequences."