A Citi analyst, Andrew Coombs, has updated his assessment of Standard Chartered (SCBFF, Financial) by raising the stock's price target. The new target is set at 1,145 GBp, up from the previous 1,115 GBp. Despite this adjustment, Coombs maintains a Neutral rating for the company's shares.
SCBFF Key Business Developments
Release Date: May 02, 2025
- Operating Income: $5.4 billion in Q1 2025, a 7% increase year-on-year.
- Profit Before Tax: $2.3 billion, up 12% year-on-year.
- Earnings Per Share: Increased by 19% year-on-year.
- Operating Expenses: Increased by 5% year-on-year.
- Credit Impairment: $219 million in Q1 2025.
- Net Interest Income (NII): Down 5% quarter-on-quarter.
- Non-NII Growth: Up 7% or 18% excluding notable items.
- Wealth Solutions Income: Up 28% in Q1 2025.
- Global Markets Income: Up 14% in Q1 2025.
- Global Banking Income: Up 17% in Q1 2025.
- Transaction Services Income: Down 4% due to rate-driven margin compression.
- Risk-Weighted Assets (RWA): Increased by $7 billion in Q1 2025.
- CET1 Ratio: 13.8% in Q1 2025, a 21 basis points increase quarter-on-quarter.
- Tangible Net Asset Value (TNAV) Per Share: Up $0.20 quarter-on-quarter.
- Wealth & Retail Banking Income: Up 12% to $2.1 billion in Q1 2025.
- Affluent Net New Money: $13 billion in Q1 2025.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Standard Chartered PLC (SCBFF, Financial) reported a 12% year-on-year increase in income for Q1 2025, excluding notable items.
- Earnings per share rose by 19%, driven by strong performance in Wealth Solutions, Global Markets, and Global Banking.
- The company's network business, which accounts for 60% of CIB income, is highly diversified and resilient.
- The cross-border strategy and affluent business are capturing opportunities in wealth creation across dynamic markets.
- The company has increased its hedging to reduce interest rate sensitivity, with a short-dated balance sheet.
Negative Points
- Operating expenses increased by 5% year-on-year due to inflation and business growth initiatives.
- Credit impairment was $219 million, with a notable charge in the WRB segment.
- Net interest income (NII) was down 5% quarter-on-quarter, with challenges expected in growing NII for 2025.
- The company faces potential risks from geopolitical developments and trade tariffs impacting global growth.
- Market risk-weighted assets increased by $8 billion, although expected to reduce in Q2.
