StanChart earnings jump 16% on strong wealth management

(Sharecast News) - Asia and Africa-focused bank Standard Chartered on Tuesday reported a 16% rise in annual earnings on the back of a strong performance at its wealth management division. Pre-tax profit came in at $6.96bn, compared with $6bn a year earlier and fell slightly short of the $7.2bn forecast by analysts in a company-compiled poll. StanChart also unveiled a $1.5bn share buyback to start immediately.

Net interest income - the difference between loan earnings and payouts on deposits - grew 1% to $11.2bn due to lower interest rates. Earnings from fees and commission rose to $5.35bn from $4.62bn a year earlier.

Wealth management income jumped 24%, driven by growth in investment products and bancassurance, while the global banking division, which provides services to cross-border clients, reported a 15% income increase on the back of higher business volumes and higher capital markets activity.

Underlying return on tangible equity, a key banking metric, rose to 14.7%, exceeding the lenders three-year target of 13% a full year early. The bank said it was now aiming for greater than 12% this year on a statutory basis.

"We have made a good start to the year and continue to benefit from a supportive business environment. We are seeing robust growth in our larger markets, and structural shifts in global trade and investment play to our distinctive strengths serving our clients' cross-border and affluent banking needs," said chief executive Bill Winters.

For 2026, StanChart forecast operating income growth at the lower end of a 5% - 7% range on a constant currency basis, excluding notable items, with net interest income growth likely to be broadly flat.

"Standard Chartered's results were untidy at first glance, with profits missing expectations as weaker global markets income and higher costs outweighed a steady lending performance," said Matt Britzman, senior equity analyst at Hargreaves Lansdown.

"After years of reshaping the business, the bank is in the best condition it has been for some time, with that progress increasingly showing up in the numbers and helping drive a 50% share price gain over the past year. The growing foothold in affluent banking across Asia, Africa and the Middle East remains a clear long‑term opportunity."

There is still work to do on costs, but with the "Fit for Growth" programme entering its final year, further progress should be coming, and the valuation doesn't look too demanding when stacked up against its Asian peers."

Reporting by Frank Prenesti for Sharecast.com