By Selena Li and Lawrence White
HONG KONG/LONDON, July 29 (Reuters) – Standard Chartered reported on Wednesday a better-than-expected 9% rise in first-half pretax profit and lifted its full-year income target, as wealth and global banking revenue surged and credit charges tied to the Iran war held steady.
The bank’s Hong Kong-traded shares rose more than 5% after the earnings release to hit an almost 19-year high.
StanChart, which earns most of its revenue in Asia and Africa, said that pretax profit for the first six months of this year reached $4.78 billion. That compared with $4.38 billion a year earlier and the $4.52 billion average of 16 analyst estimates compiled by the bank.
The bank revised its guidance for the year, saying it would see income growth around the middle of a 5-7% range instead of previous guidance for it to be closer to the bottom.
Wealth management income jumped 38%, driven by double-digit growth in investment products as inflows and the number of new accounts increased amid strong demand for wealth advice during a period of market volatility.
“Clients continue to turn to us to facilitate trade, investment and wealth flows across the world’s most dynamic markets,” Group Chief Executive Bill Winters said in a statement.
StanChart said its Middle East portfolio represents 6% of overall exposures, and that it had remained broadly stable.
The lender took a $44 million additional impairment in the second quarter, which it said partly reflected clients in the petrochemical sector showing early signs of distress.
It set aside $190 million as precautionary management overlays in April against expected future losses.
StanChart announced a $1 billion share buyback, along with an interim dividend of 20.4 cents per share, up from 12 cents the year before.
(Reporting by Selena Li in Hong Kong and Lawrence White in London; Editing by Kevin Buckland)
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