Euro debt woes hurt Standard
FEARS over Europe’s debt crisis have hit business for the emerging markets bank Standard Chartered.
In a trading update the bank said worries over sovereign debt had dented demand for products in its wholesale banking and wealth management arms, taking the gloss of an otherwise good first-half performance. Its shares fell 32p to 1710p.
Standard Chartered is among the first banks to warn on the impact of the eurozone crisis.
Finance director Richard Meddings said underlying growth had been strong.
He was “very comfortable” with analysts’ forecasts of a 15 per cent rise in profit to a record $5.9billion (£4billion) this year.
Standard’s statement came as the pound reached a new 18-month high against the euro on speculation that debt woes would leave the continent in a weaker position than the UK, where last week’s Budget is seen as putting the country’s books into shape.
Bank of England Monetary Policy Committee member Andrew Sentance, who recently voted for an interest rate hike, gave the pound a further boost by saying that the Budget would not remove the need to raise rates.
Analysts said Standard Chartered had been helped by a big drop in bad debts. Impairments are expected to fall from $1.1billion to $585million in the first half.