Standard Chartered

Annual report 2017

Driving commerce and prosperity through our unique diversity

We use our diverse network and culture to create innovative products and services that help people, businesses and communities succeed and prosper.

Download the full report

Performance

2017 in numbers

Operating income

$14,289m

underlying basis

$14,425m

statutory basis

Greenhouse gas emissions

42%

Reduction in greenhouse gas emissions
for fuel combustion

Operating expenses

$10,120m

underlying basis

$10,417m

statutory basis

Earnings per share

47.2 cents

underlying basis

23.5 cents

statutory basis

Number of volunteering days

66,000

Colleagues contributed 66,000 volunteering days in 2017

Total assets

$663,501m

Community investment

$49.8m

2017

Return on equity

  • 3.5%

    Underlying

  • 1.7%

    Statutory

2017

Reusable cup initiative

100,000

Reduction in single plastic cup use in six months

Profit before taxation

  • $1,093m

    Underlying

  • $409m

    Statutory

2016

  • $3,010m

    Underlying

  • $2,415m

    Statutory

2017

Statements

The Chairman of Standard Chartered, José Viñals

Chairman’s Statement

“Our obligation is to carry out our business in a way which not only provides returns for our shareholders but also delivers good things for society: our clients, communities, and people.”

José Viñals Group Chairman
Read José’s statement
Group Chief Executive Officer of Standard Chartered, Bill Winters

Group Chief Executive’s review

“We have made encouraging progress in transforming the Group, the path ahead is clear and we are now well positioned to drive sustainable profit growth across our markets.”

Bill Winters Group Chief Executive
Read Bill’s review

Strategy

A strategy addressing long-term trends

Our strategy was developed against the backdrop of six long-term trends, which will continue to significantly shape the economies and broader landscape in the markets in which we operate. We believe that each of these long-term trends presents opportunities that we are uniquely positioned to capture

Three strategic objectives...

Secure the foundations

We have substantially completed this objective, putting us in a position of strength from which to confidently drive business growth

Progress in 2017

Common Equity Tier 1 ratio: 13.6%

Loan impairment:
$1.2bn (underlying)
(2016: $2.4bn)

Focus for 2018

Maintain a strong capital position

Continue efforts to further strengthen risk controls and conduct

Get lean and focused

We have continued the restructuring of our businesses and the shift towards sustainable, profitable growth

Progress in 2017

Profit before tax:
$3.0bn (underlying)
(2016: $1.1bn)

Return on equity:
3.5% (underlying)
(2016: 0.3%)

Focus for 2018

Drive income within our desired risk appetite, and contain costs, leveraging technology

Focus on driving sustainable momentum in capital and returns-accretive businesses

Invest and innovate

We have invested to improve the way we serve our clients and the way we collaborate. Examples include significant investments in automation and a revamped learning offering for colleagues

Progress in 2017

Digitisation and analytics
driving efficiency and superior client service

Retail Banking digital adoption: 44.7% of clients
(2016: 39.6%)

Focus for 2018

Ambitious investment plan in technology to drive business

Invest in our people and culture

Leverage our unique diversity to serve our clients better

Rise of urban middle class

Markets in our footprint are urbanising rapidly and becoming more consumption-led, driving rapid growth in demand for wealth and financing solutions

Our strategic response:

Focus on the affluent and wealth offerings

Digital revolution

Digital adoption in our markets is often ahead of otherwise more developed Western markets. Digitisation offers an opportunity for us to deliver more convenient and efficient solutions to clients and thus to increase our client reach and engagement in a cost-effective manner

Our strategic response:

Accelerate pace of our digitisation

Increasing regional connectivity

Despite a rise in anti-globalisation sentiment in several parts of the world, we are witnessing in the long term the emergence of complex supply chains, combined with new frameworks for cooperation, such as the Belt and Road Initiative and ASEAN Economic Community. With our long history in the markets that are driving these trends, we are uniquely positioned to capture the benefits they bring

Our strategic response:

Leverage our network capabilities

Financial deepening and evolving regulation

Clients are increasingly looking for innovative cross-border funding, cash management and investment solutions, coupled with local hedging instruments to better manage risks. This, along with the growing sophistication of the financial services sector, and ongoing government-led reform, is driving the deepening and internationalisation of local capital markets in our footprint

Our strategic response:

Strengthen our capital markets capabilities

The rise of renminbi (RMB)

The launch of the Cross-Border Interbank Payment System and the inclusion of RMB in the International Monetary Fund’s Special Drawing Rights basket of currencies are major landmarks on the RMB’s path to internationalisation. We expect that by 2020, 5 per cent of global international payments could be settled in RMB

Our strategic response:

Maintain leadership in RMB

The growth of Africa

Backed by a large workforce and a growing, connected urban middle class, there are many growth opportunities across African economies. This is particularly the case in sectors such as agriculture, fast-moving consumer goods and infrastructure

Our strategic response:

Focus on urban Africa

Download our strategy

Client Segments

Serving client segments with differentiated expertise

Corporate & Institutional Banking supports clients with their transaction banking, corporate finance, financial markets and borrowing needs across more than 60 countries, providing solutions to over 5,300 clients in some of the world’s fastest-growing economies and most active trade corridors.

  • Profit before taxation

    $1,261m

    underlying basis

    $986m

    statutory basis

  • Risk-weighted assets

    $147bn

    Return on risk-weighted assets

    0.9%

    underlying basis

Two Standard Chartered employees talking in an office

Leading Digital Channels

A single gateway for payments in China

In February 2017, we became the first international bank to launch a mobile wallet collection service in China. Having worked closely with national and international businesses and banking institutions in China, we recognised the need for a single digital gateway to connect and consolidate multiple payment channels. Within six months, we implemented solutions for 17 corporates across China and have assisted them with more than 26,000 payment transactions. That number is growing daily.

Retail Banking serves over nine million individuals and small businesses, with a focus on the affluent and emerging affluent in many of the world’s fastest-growing cities. We provide digital banking services with a human touch to our clients across deposits, payments, financing products and Wealth Management, as well as supporting their business banking needs.

  • Profit before taxation

    $873m

    underlying basis

    $854m

    statutory basis

  • Risk-weighted assets

    $44bn

    Return on risk-weighted assets

    2.0%

    underlying basis

Two Standard Chartered employees talking in an office

UNDERSTANDING CLIENTS’ BANKING NEEDS

Building relationships through technology

We are constantly enhancing our products and services to take advantage of digital advances. This includes our new voice recognition platforms and cross-border payment options on mobile and tablet devices for clients who need to bank anytime, anywhere. Every innovation is based on insights: we spend time getting to know our clients and understanding their banking needs and financial goals.

Commercial Banking serves over 40,000 local corporations and medium-sized enterprises in 26 markets across Asia, Africa and the Middle East. We aim to be our clients’ main international bank, providing a full range of international financial solutions in areas such as trade finance, cash management, financial markets and corporate finance.

  • Profit before taxation

    $282m

    underlying basis

    $269m

    statutory basis

  • Risk-weighted assets

    $33bn

    Return on risk-weighted assets

    0.9%

    underlying basis

Standard Chartered employees in a meeting

CROSS-BORDER RELATIONSHIPS

Helping clients grow their businesses

We are constantly increasing our global footprint and supporting clients to grow their businesses locally and internationally. In 2017, we helped more than 80 per cent of our clients engage in business outside the markets they already operated in, and almost half of them now have offices overseas. The markets we operate in and the relationships we have developed underpin the 20 per cent year-on-year growth of our network business and drives our ambition of helping small and mid-sized companies capture international opportunities.

Private Banking offers a full suite of investment, credit and wealth planning solutions to grow and protect the wealth of high net worth individuals across our footprint.

  • Loss before taxation

    $(1)m

    underlying basis

    $(16)m

    statutory basis

  • Risk-weighted assets

    $6bn

    Return on risk-weighted assets

    0.0%

    underlying basis

Three city workers in suits, sitting and talking on steps

BUILDING SKILLS FOR THE FUTURE

Mentoring the next generation of leaders

At Standard Chartered, we believe the next generation will play a critical role in shaping the world’s future. Our Future Global Leader’s Programme, part of our offering to Private Banking clients, is designed to harness the skills of tomorrow’s influencers. The programme brings together future leaders aged between 20-35 to help them connect as a global community, and develop leadership, philanthropy, sustainability and entrepreneurship skills, so that they can maximise their potential and enable others to do the same. In 2017, we held the programme in London, Cape Town, Delhi and Singapore.

Download our client segment overview

Regions

Supporting clients in dynamic economies

Profit before taxation

$1,942m

underlying basis

$1,977m

statutory basis

Risk-weighted assets

$85bn

loans and advancesincome split
Greater Chine and North Asia map

Profit before taxation

$492m

underlying basis

$350m

statutory basis

Risk-weighted assets

$97bn

loans and advancesincome split
ASEAN and South Asia map

Profit before taxation

$642m

underlying basis

$609m

statutory basis

Risk-weighted assets

$56bn

loans and advancesincome split
Africa and Middle East map

Profit before taxation

$71m

underlying basis

$46m

statutory basis

Risk-weighted assets

$45bn

loans and advancesincome split
Europe and Americas map
Download our regional overview

Stakeholders and responsibilities

Creating long-term value for stakeholders

To drive commerce and prosperity across our footprint, we need to take a long-term view. Listening and responding to stakeholder issues or concerns is critical to achieving this. We strive to maintain open and constructive relationships with a wide range of stakeholders to help us operate as a responsible and sustainable business.

Stakeholders & Responsibilities

clientsClients
How we serve and engage

We enable individuals to grow and protect their wealth. We help businesses to trade, transact, invest and expand. We also help a variety of financial institutions – including banks, public sector and development organisations – with their banking needs.

regulatorsRegulators and governments
How we serve and engage

We engage with the relevant authorities to play our part in supporting the effective functioning of the financial system and the broader economy.

investorsInvestors
How we serve and engage

We aim to deliver robust returns and long-term sustainable value for our investors. We engage with investors about all aspects of our financial, environmental and social performance. Whatever the nature of the investor, we treat them equally and aim to balance their diverse interests and expectations.

colleaguesColleagues
How we serve and engage

We offer colleagues opportunities to learn and progress. We encourage them to improve and innovate, to take ownership of their careers and succeed together.

Diversity and inclusion

With more than 86,000 colleagues in 63 markets, we are proud to represent the broad range of cultures across the communities we serve. Harnessing the inherent diversity of thoughts, views and experiences across the Group is critical to our business success and fundamental to our purpose. We are committed to creating a work environment that enables our colleagues’ diverse strengths to positively impact our clients and communities.

Women in senior roles

25.7%

Percentage of women in senior roles

+0.8%

Employee net promotor score

5.9%

Community initiatives

Seeing is Believing

$5.6m

raised

Goal

95,000+

girls reached

Financial Education

117,000

young people trained

Download stakeholders and responsibilities information