We have also made an investment (in multiple lot purchases over the last two years) in Standard Chartered Bank (LSE:STAN), a UK-headquartered but largely emerging-market-dependent bank that again in our view was conservatively financed by deposits well in excess of loans, and has, in our opinion, one of the best banking networks across Asia, the Middle East, Africa and other emerging markets. Unlike our other Asian bank holdings, Standard Chartered has incurred above average loan losses and recently replaced senior management and undertaken multiple steps to address what we consider to be “fixable” problems. While this process may, and usually does, take longer than expected, we are optimistic that the bank will be able to get through this difficult period, and ultimately emerge stronger and more profitable. As you can imagine, given the uncertainty around China’s future growth (as evidenced by the recent devaluation of the yuan), these bank investments have not been getting the votes from “Mr. Market” over the near term; however, over the longer term, China and other parts of Asia should, in our opinion, continue to grow at rates in excess of the growth rates found in most of the Western world, and we believe these banks should remain significant beneficiaries of that growth.
from Tweedy Browne (Trades, Portfolio) Investment Advisers' semi-annual report shareholder letter.
