HONG KONG - Standard Chartered said on Wednesday it expects pretax profit in the first half of this year to grow by less than 10 per cent, slowing from previous years as growth in Asia eases and local currencies weaken against the dollar.
Income growth in January-June was also expected to slow to below 10 per cent, it said in a filing to the Hong Kong bourse.
"Local currency weakness is expected to drag group income by over 2 per cent, with the Indian rupee being the major contributor," StanChart said in the statement.
Standard Chartered conducts most of its business in local currencies but reports its earnings in dollars. As such, weakening Asian currencies would mean it needed more Indian rupees or Singapore dollars to get the same amount of US currency.
Staff numbers are largely flat at the end of May from the end of 2011, StanChart said. The bank employed about 85,000 people at the end of last year, it said in March.
Run by Chief Executive Peter Sands, the bank grew exponentially for much of the last decade, riding on Asia's rise and reporting a ninth straight year of record earnings in 2011 on the back of buoyant growth in Hong Kong and Singapore.
However, concern over slowing growth in large Asian markets such as China and India has weighed on the company's stock this year.
The bank's outlook is weaker than analysts' expectations. On average, the market expected pretax profit to rise 10.6 per cent this year to US$7.4 billion (S$9.5 billion), according to a poll of 30 analysts surveyed by Thomson Reuters I/B/E/S.
"Many people are expecting things to slow, and this has been reflected in the share price," said Adam Chan, an analyst at CCB International in Hong Kong who has an "outperform" rating on the stock.
"Management knows that sentiment is weak, and that's why they're choosing to invest this year and have those investments pay off in 2013 or 2014 when things get better."