Driving investment, trade and the creation of wealth across Asia, Africa and the Middle East

"The business has grown substantially over the last decade and we continue
to view Standard Chartered as an exciting growth story. We will continue
to support the growth of trade and wealth across our markets and drive value for shareholders."
Sir John Peace, Chairman

Who we are

We are a leading international banking group, with more than 86,000 employees and a 150-year history in some of the world's most dynamic markets.

>1600

branches

70

markets

132

nationalities

86,640

employees

We bank the people and companies driving investment, trade and the creation of wealth across Asia, Africa and the Middle East, where we earn around 90 per cent of our income and profits. Our heritage and values are expressed in our brand promise, Here for good.

Our Strategy & Business model

Our ambition

The world's best international bank

Our strategy

We bank the people and companies driving investment, trade and the creation of wealth across Asia, Africa and the Middle East

Our brand promise

Here for good

Our aspirations

Relationships

Build trusted relationships with the people, companies and institutions shaping our markets' future

Investment

Play a leading role in facilitating investment and deepening financial markets

Trade

Become the undisputed leader in commercial payments and financing for and in Asia, Africa and the Middle East

Wealth

Be recognised as a leader in growing and protecting our clients' wealth

Relevant scale

Establish sufficient scale and balance sheet and franchise strength to be relevant and influential in our key markets

Our values

Courageous

We take measured risks and stand up for what is right

Responsive

We deliver relevant, timely solutions for clients and customers

International

We value diversity and collaborate across the network

Creative

We innovate and adapt, continuously improving the way we work

Trustworthy

We are reliable, open and honest

Our commitments

Colleagues

A great place to work, enabling individuals to grow and teams to win

Society

A force for good, promoting sustainable economic and social development

Investors

A distinctive investment, delivering consistently superior performance via disciplined growth

Regulators

A responsible partner with exemplary governance and ethics

 

Our geographies

We operate in 70 markets with a focus on Asia, Africa and the Middle East
Across our markets, we use our network and collaborate as one bank to serve our clients and customers

We manage savings and cash and facilitate transactions

Deposits

We help customers manage their savings and cash and make transactions

Wealth management

We help people grow and protect their wealth to meet long-term needs

SME Banking

We help SMEs do business by managing their cash, payments and collections

Transaction Banking – Cash and Custody

We help companies do business by managing their cash, transactions and securities holdings

Our activities

Consumer Banking

Individuals

Personal and Preferred Banking customers

Priority and International Banking customers

Private Banking customers

Small and Medium-sized Enterprises (SMEs)

Wholesale Banking

Global Corporates

Large multinational corporations

Local Corporates

Corporations that operate mainly in their home market

Financial Institutions

Banks and other financial institutions

Commodity Traders and Agribusiness

Commodity traders, producers and processors

We supply funds for productive uses, facilitate trade and provide advice

Cards, Personal Loans and Unsecured Lending

We help customers finance their needs at various life stages

Mortgages and Auto Finance

We supply credit to help people buy homes and vehicles

SME Banking

We help SMEs to set up, trade and expand

Lending and portfolio management

We provide finance to help businesses grow

Transaction Banking – Trade

We facilitate cross-border trade, by providing companies with finance and transactional services

Financial Markets

We help clients invest, manage their risks and raise debt capital

Corporate Finance

We support clients with strategic advice and solutions, including for mergers and acquisitions and raising equity finance

Principal Finance

We make equity investments to supply businesses with the capital they need to grow

Islamic Banking

Under our 'Saadiq' brand, we offer people and businesses in a number of our markets the choice to bank in accordance with their faith by giving them access to a wide range of Shariah-compliant banking products and services

Our enablers

Finance

Measuring and managing financial performance

Human Resources

Acquiring, developing and retaining talent

Technology and Operations

Providing the infrastructure and support for the Group to effectively and efficiently carry out its activities

Risk

Upholding the overall integrity of the Group's risk/return decisions; ensuring that risks are assessed and controlled in accordance with the Group's standards and risk appetite

Compliance

Ensuring the Group's activities and conduct comply with legal and regulatory requirements

Treasury

Managing the Group's capital and liquidity, including ensuring we meet regulatory requirements and have sufficient capacity to absorb losses

Other central support functions

  • – Corporate Real Estate
  • – Strategy
  • – Corporate Development
  • – Corporate Affairs
  • – Legal
  • – Audit
  • – Corporate Secretariat
  • – Research

Financial Highlights

  • Normalised return on equity1
    %

    2011 12.2, 2012 12.8, 2013 11.2

    Normalised earnings per share1
    cents

    2011 198.0, 2012 225.2, 2013 204.0

    Dividend per share2
    cents

    2011 76.0, 2012 84.0, 2013 86.0
    1. Standard Chartered uses non-generally accepted accounting principles (GAAP) measures, where these are not defined under International Financial Reporting Standards (IFRS) or they have been adjusted. Normalised earnings are defined in the Glossary on page 334 and in note 14 to the financial statements
    2. Represents the recommended final dividend per share for the respective years together with the interim dividend per share declared and paid in those years. Further details are set out in note 13 to the financial statements
  • Operating income3
    $m

    2011 17,380, 2012 18,783, 2013 18,777

    Profit before taxation3
    $m

    2011 6,753, 2012 6,851, 2013 6,064

    Total assets
    $bn

    2011 588, 2012 631, 2013 674
    1. Operating income in 2013 includes a credit of $106 million relating to own credit adjustment (OCA). Profit before taxation for 2013 includes OCA and a goodwill impairment of $1 billion. 2012 includes a charge of $667 million in respect of the settlements with the US authorities. The US authorities comprise The New York Department of Financial Services (DFS), the Office of Foreign Assets Control (OFAC), the New York County District Attorney's Office (DANY), the United States Department of Justice (DOJ) and the Federal Reserve (NYFED)
    2. Amounts have been restated as explained in note 43 to the financial statements
    3. Amounts have been restated for the impact of using the equity method of accounting for joint ventures and for the allocation of associates and joint ventures to Consumer Banking and Wholesale Banking
  • Consumer Banking operating income
    $m

    2011 6,630, 2012 7,021, 2013 7,179

    Consumer Banking profit before taxation
    $m

    2011 1,660, 2012 1,749, 2013 1,550

    Consumer Banking total assets
    $bn

    2011 131, 2012 139, 2013 139
    1. Amounts have been restated as explained in note 43 to the financial statements
    2. Amounts have been restated for the impact of using the equity method of accounting for joint ventures and for the allocation of associates and joint ventures to Consumer Banking and Wholesale Banking
  • Wholesale Banking operating income
    $m

    2011 10,750, 2012 11,672, 2013 11,492

    Wholesale Banking profit before taxation
    $m

    2011 5,258, 2012 5,186, 2013 5,643

    Wholesale Banking total assets
    $bn

    2011 449, 2012 484, 2013 529
    1. Amounts have been restated as explained in note 43 to the financial statements
    2. Amounts have been restated for the impact of using the equity method of accounting for joint ventures and for the allocation of associates and joint ventures to Consumer Banking and Wholesale Banking

Our performance this year

Operational highlights

Market performance

25

markets

Broad-based performance across multiple markets, with operating income of
over $100 million in 25 markets

Client income

Banconotes

Resilient client income, with strong increases in customer volumes in Transaction Banking, Financial Markets and Corporate Finance, partially offset margin and spread compression

Largest market

Hongkong flag

Hong Kong, our largest market, grew income 11 per cent and operating profit 16 per cent

Renminbi (RMB)

#1

The Group was the number one global underwriter of offshore renminbi (RMB) bonds and partnered Agricultural Bank of China to provide RMB clearing services in London

Retail operations

Globe

Reopened in Myanmar, subsidiarised our retail operations in Singapore and acquired a custody business in South Africa

Balance sheet

Graph finance

The balance sheet continues to be strongly capitalised, highly liquid and well diversified

Key performance indicators

  • Normalised earnings per share

    cents

    2013 204, 2012 225.2, 2011 198.0, 2010 197.0, 2009 173.2

    Aim

    To deliver double-digit earnings per share (EPS) growth.

    Analysis

    Resilient performance in a challenging environment.

    1. We have removed the previously reported KPI on operating income
      growth to better align the KPIs with our sharpened strategic focus

    Normalised return on shareholders' equity

    %

    2013 11.2, 2012 12.8, 2011 12.2, 2010 14.1, 2009 14.3

    Aim

    To deliver mid-teens returns over the medium term while balancing the long-term objective of having strong yet efficient levels of capital.

    Analysis

    The normalised return on equity reduced to 11.2 per cent, as profits declined.

  • Operating income by region in 20132

    Hong Kong 20%, Singapore 11%, Korea 8%, Other Asia Pacific 19%, India 9%, Middle East and Other South Asia 12%, Africa 9%, Americas, UK and Europe 12%
    1. Operating income in 2013 includes a benefit of $106 million relating to own credit adjustment (OCA)

    Aim

    To deliver diversified income streams across our footprint.

    Analysis

    Our income stream remains highly diversified with 25 markets delivering over $100 million of income.

  • Consumer Banking

    Net Promoter Score (NPS) Index3

    2013 61, 2012 55, 2011 46, 2010 39, 2009 25

    Aim

    To increase customer satisfaction with our products and services and to become the bank that customers recommend.

    Analysis

    Our global NPS is up 1 point from 55 to 56.

    Wholesale Banking

    Core bank – number of client relationships

    Wholesale banking graph from 2011 to 2013

    Aim

    To continue to grow the total number of client relationships that deliver income in excess of $1 million, $5 million and $10 million.

    Analysis

    We have consistently grown the number of leading clients that generate income in excess of $1 million, $5 million and $10 million per year, demonstrating our strong and consistent progress in delivering our Wholesale Banking strategy to become the core bank to more clients.

  • Capital ratios

    Capital ratios graph from 2009 to 2013

    Aim

    To maintain a strong capital base, with an increasing emphasis on Core Tier 1 capital.

    Analysis

    Core Tier 1 ratio for 2013 was 11.8 per cent and total Tier 1 was 13.1 per cent. The Group's capital position continues to be strong with good levels of organic equity generation, positioning us well for future changes as the regulatory environment continues to evolve.

  • Total Scope 1 & 2 Greenhouse Gas emissions/$million operating income

    Total Scope 1 & 2 Greenhouse Gas emissions/$million operating income graph from 2011 to 2013

    Aim

    To improve energy efficiency across our markets.

    Analysis

    Achieved better energy efficiency relative to revenue for the past three years.

    Note

    Achieved better energy efficiency relative to revenue for the past three years.

    The emissions within our inventory, arising from our energy use, correspond to a reporting period of 1 October to 30 September to allow sufficient time for independent assurance to be gained. Accordingly, the operating income used in this inventory corresponds to the same period rather than calendar year used in financial reporting, but this is consistent with international carbon reporting practice.

Case studies

Supporting the renminbi (RMB) needs of our customers

Chinese market

"As part of our commitment to meet our customers' retail, investment and business banking needs, we offer a broad range of RMB solutions."

As part of our commitment to meet our customers' retail, investment and business banking needs, we offer a broad range of RMB solutions, including RMB-denominated deposits, mutual funds, structured products, and insurance and bonds for our retail and high net worth customers.

Standard Chartered Hong Kong is among the first banks to offer RMB-denominated accounts to non-HK residents, making it easier for them to access their RMB accounts in China.

Within 10 months of domestic banks becoming eligible to offer RMB-related services in Taiwan, Standard Chartered collected deposits of over RMB138 billion from local customers seeking to allocate assets in RMB. In April 2013, Standard Chartered China launched direct cross-border RMB remittance for Taiwanese residents, allowing them to open special accounts for RMB remittances from Taiwan.

We also offer onshore and offshore RMB solutions to SMEs, such as trade settlement and invoicing. In the third quarter of 2013, a People's Bank of China
sub-branch announced a new policy allowing RMB
cross-border lending and borrowing between
Taiwanese-owned companies and those registered in Kunshan, China. As a result of this ruling, we were able to provide our Taiwanese SME clients with a
cross-border RMB lending transaction capability to help them deliver on their business ambitions.

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Digitising banking

Standard Chartered bank customer

"We are digitising our business to improve how we serve our clients and customers, and to make our operations more efficient."

We are digitising our business to improve how we serve our clients and customers, and to make our operations more efficient.

We are integrating our IT systems and simplifying and automating our processes to increase productivity, ensure a robust control environment and free up our frontline staff. This enables them to spend more time with our clients and customers.

Several years ago, with the launch of our award-winning mobile banking app, Breeze, we responded to a shift in consumer behaviour, allowing our clients and customers to bank where and when they wanted. We coined the phrase 'Digital Main Bank' to capture our aspiration and have been making steady progress each year.

Since then, we have been focusing on improving and bringing consistency to every part of our business. Our Express Banking Centres (EBC) help connect clients and customers with a full suite of automated and digitised processes and trained service ambassadors are on hand to assist them bank swiftly and efficiently.

Digitisation has also allowed us to simplify our application and documentation processes, making it easier and faster for new customers to open an account with us.

Our Digital Education Programme empowers staff to help clients and customers with their introduction or transition to digital banking. The programme coaches staff on how to walk clients and customers through their first digital transaction seamlessly and confidently.

Concern around security is often a barrier to digital banking. We understand this concern and maintaining the highest levels of security and protection is our priority. We offer regular SMS and email alerts, automatic logouts, advanced second factor authentication and 128-bit secure socket layer to ensure a safe and secure experience.

We have seen a significant shift to digital in terms of customer usage, number of transactions and products applied for through digital channels. The feedback from our clients and customers remains very positive and our online Net Promoter Score for digital channels exceeds all other channels. In 2013, for the third consecutive year, we were recognised as the World's Best Consumer Internet Bank (Global Finance).

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International network, local scale

Buddhist temple

"Our strong track record for standing by our clients and doing the right thing has established us as a trusted partner to support our clients' growth ambitions as they expand into new markets."

With more than 150 years of experience driving investment, trade and the creation of wealth across our footprint, we provide our clients with an unmatched international network across Asia, Africa and the Middle East, coupled with
on-the-ground expertise to support the
cross-border and in-country needs of clients.

Our strong track record for standing by our clients and doing the right thing has established us as a trusted partner to support our clients' growth ambitions as they expand into new markets.

In Asia, we have been working with the UK Government, Myanmar's Ministry of Finance and the Central Bank of Myanmar to establish a UK-Myanmar Financial Services Taskforce. The taskforce will support the development of the country's financial sector. In early 2013, we reopened our representative office in Yangon, reflecting Myanmar's reintegration into the global economy.

We are now the only major international bank with a presence in all of the 10 Association of Southeast Asian Nations (ASEAN) countries. Myanmar assumes the role of ASEAN chair in 2014 and our strong partnership with the UK and Myanmar governments, together with our presence across ASEAN, is enabling the Group to play a key role in the country's economic integration with the wider region.

Since our re-entry into Myanmar, we have steadily built a broad base of clients across different sectors, as clients seek a reliable global banking partner with a local presence to support their investments. We are also extending our support to our existing clients wishing to do business in the country. In November 2013, we extended financing to Navigat Group, Indonesia's leading power plant operator, which is helping to expand power generation capacity in Myanmar through the construction and operation of efficient gas-fired power plants.

In the Middle East, we were the first international bank to establish a full branch in Iraq with the opening of our Baghdad office in November. We have operated in Iraq through a representative office since 2006 and our growing local presence reflects strong demand for our services from clients in the power, oil, telecommunications and infrastructure sectors. The Group will be opening additional branches in Erbil and Basra in 2014.

In Africa, we opened our representative office in Angola in 2010. In January 2014, we upgraded our presence to an onshore banking subsidiary, the first major international bank with an onshore presence in the country. The subsidiary, with the Group as a majority shareholder, will enable us to provide both onshore and offshore financing to support the growing needs of our clients.

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Renminbi (RMB) internationalisation

Hong Kong skyline

"Standard Chartered's comprehensive capabilities, deep market knowledge and cross-border strengths enable clients to take full advantage of opportunities presented by the RMB."

2013 set a new high point for the internationalisation of the RMB, fuelled by China's growing trade and investment ties across the globe. The RMB was the 10th most used payments currency globally according to SWIFT data and passed the euro as the second most used trade finance currency. The Standard Chartered Renminbi Globalisation Index recorded its fastest growth in 16 months in November 2013.

Standard Chartered's comprehensive capabilities, deep market knowledge and cross-border strengths enable clients to take full advantage of opportunities presented by the RMB.

To better capture new opportunities from the internationalisation of the RMB and support the rapidly expanding demand for the Group's RMB business, Standard Chartered created an RMB Solutions team to deliver bespoke client solutions, and established the Global RMB trading team, made up of traders across key markets in Singapore, Shanghai, Hong Kong, Taiwan, London and New York, to offer seamless and consistent client coverage around the clock.

In May 2013, Standard Chartered Hong Kong completed the first ever CNH HIBOR Fixed Interest Rate Swap transaction with a Hong Kong-based corporate client. Shortly after the People's Bank of China simplified cross-border lending denominated in RMB, we completed a cross-border financing deal to enable a global manufacturing client to use surplus RMB funds on the mainland to support its offshore RMB needs.

The steady growth of RMB liquidity pools and availability of clearing services in global financial hubs, including Hong Kong, Taiwan, Singapore and London, are also encouraging companies to adopt the RMB as one of their working capital currencies.

The Group is playing a leading role in supporting London as an RMB hub with its partnership with the Agricultural Bank of China to offer London-based RMB clearing services. In Singapore, the Group was the first to issue a RMB 1 billion bond that was locally listed, cleared and settled on the Singapore Exchange.

To boost RMB-denominated trade flows, the Group also launched a first-ever funding partnership with the International Finance Corporation. The programme is expected to generate about RMB 36 billion in incremental trade by delivering affordable credit to support exports from emerging markets across Asia, Africa and the Middle East to China.

We closed the year as the leading foreign bank in China in providing RMB nostro clearing services to overseas financial institutions for cross-border RMB transactions, and ranked second on the Dim Sum Bond Issuance league tables (Bloomberg).

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Our social and economic impact in Africa

African scientist working

"We believe that banks, working with governments, regulators and local communities, can and should help to drive real social and economic development in the markets where we work."

Having opened our first branch in Africa 150 years ago, we continue to invest for the long term, supporting the people and businesses driving trade, investment and the creation of wealth across the continent.

We believe that banks, working with governments, regulators and local communities, can and should help to drive real social and economic development in the markets where we work.

In 2013 we commissioned an independent study to measure the role of Standard Chartered, and banking more broadly, in generating trade, growth and jobs across Africa – one of the fastest-growing regions of the world – and to find out what we can do better.

By measuring ripple effects through the economy, the study shows that our operations and financing support 1.2 per cent of GDP and some 1.9 million jobs, or 0.6 per cent of the total workforce, in 13 of the 15 markets where we operate in Sub-Saharan Africa.

The study also highlights how we help to remove barriers to growth and job creation, by using our footprint as an international bank focused on Asia, Africa and the Middle East to mobilise offshore capital for crucial infrastructure investment, train local talent, introduce innovation and help to develop local financial markets.

The study confirms that small and medium-sized enterprises (SMEs) are powerful job creators. We will invest more time in looking at how we can work with our large corporate clients to support more African SMEs through the supply chain. We will also explore how we can help create greater inter-linkages between different economic sectors in Africa, from farming to manufacturing and distribution, in order to increase our impact on real development.

The study on Africa, led by Professor Ethan Kapstein, is our fourth and most comprehensive impact study to date, following country-specific reports on Ghana, Indonesia and Bangladesh.

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Celebrating 10 years of Seeing is Believing

African eye test

"In 2003, we founded Seeing is Believing (SiB) with a simple mission: to help people see. 10 years later, we have reached more than 45 million people."

In 2003, we founded Seeing is Believing (SiB) with a simple mission: to help people see. 10 years later, we have reached more than 45 million people.

An estimated 39 million people across the world are blind, and a further 246 million people are visually impaired. SiB has helped tackle this issue by providing quality eye-care for people who have little or no access to health services.

Set up in response to a call from our employees to help local communities, SiB is a collaboration between Standard Chartered, the International Agency for the Prevention of Blindness and leading eye-care organisations.

Making an impact

So far, we have raised more than $63 million, with the Group matching all contributions dollar for dollar. Our employees contribute greatly to the programme by donating, fundraising and volunteering their time at local eye-care projects.

Through a total of 84 projects in 25 countries, SiB has helped fund over 2.91 million cataract operations and surgical interventions, protected 3.9 million people from Vitamin A deficiency and river blindness, distributed 494,000 pairs of spectacles and trained more than 100,000 community health workers.

We are committed to raising $100 million by 2020, through donations and matching by the Group. In 2013, we further extended our support for eye health by pledging $20 million to support the work of The Queen Elizabeth Diamond Jubilee Trust in helping to eliminate avoidable blindness.

For more information see www.seeingisbelieving.org

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