Interim Results - Part 4

Standard Chartered PLC 1 August 2001 Part 4 16. Net interest margin and interest spread 6 months 6 months 6 months ended ended ended 30.06.01 30.06.00 31.12.00 % % % Net interest margin 3.0 3.3 3.0 Interest spread 2.5 2.5 2.4 $m $m $m Average interest earning assets 94,928 81,904 91,238 Average interest bearing liabilities 85,105 70,890 81,620 17. Capital ratios 30.06.01 30.06.00 31.12.00 $m $m $m Tier 1 capital 6,031 5,483 4,531 Tier 2 capital 5,114 3,994 4,531 11,145 9,477 9,062 Less supervisory adjustments (30) (45) (34) Adjusted capital base 11,115 9,432 9,028 Risk weighted assets 53,373 47,228 50,485 Risk weighted contingents 15,138 12,004 13,981 Total risk weighted assets and 68,511 59,232 64,466 contingents Capital ratios % % % Tier 1 capital 8.8 9.3 7.0 Total capital 16.2 15.9 14.0 On 11 May 2001 the Group issued £300 million of 8.103 per cent Step up Callable Perpetual Preferred Securities. The Preferred Securities are redeemable at the option of Standard Chartered Bank on 11 May 2016 or on any subsequent coupon payment date at their principal amount together with any outstanding payments. On 30 May 2001 the Group issued US$700 million of 8.0 per cent Subordinated notes due 2031. 18. Supplementary information on Hong Kong The following table includes the results of all the Group's activities in Hong Kong. It has been prepared using the same principles as those used to prepare the geographical segmental information included in note 1. 6 months 6 months 6 months ended ended ended 30.06.01 30.06.00 31.12.00 HKDm HKDm HKDm Net revenue 5,487 4,416 4,912 Total operating expenses (2,574) (2,029) (2,289) Profit before provisions 2,913 2,387 2,623 Provisions for bad and doubtful (798) (403) (576) debts Profit before taxation 2,115 1,984 2,047 The information below is extracted from the financial information required by the Hong Kong Monetary Authority to be disclosed by authorised institutions incorporated outside Hong Kong. It includes Standard Chartered Bank in Hong Kong and Manhattan Card Company. It should be noted that definitions used by the Hong Kong Monetary Authority differ from those used by the Group. 30.06.01 30.06.00 31.12.00 HKDm HKDm HKDm Advances to customers (including 171,769 142,334 163,857 trade bills) Other assets 114,675 102,602 107,466 Total assets 286,444 244,936 271,323 Analysis of advances to customers Mortgages 89,822 79,776 88,699 Cards 16,558 7,732 15,366 Other consumer 7,392 4,041 7,069 Trade finance 8,406 10,962 8,750 Trade bills 1,992 2,533 1,990 Financial concerns 15,215 11,809 11,787 Other* 32,384 25,481 30,196 Provisions (2,537) (2,868) (2,573) Net advances to customers 169,232 139,466 161,284 *Includes HKD 6,195 million (30.06.00: HKD 4,830 million; 31.12.00: HKD 5,710 million) reported as mortgages in note 1. Gross non-performing advances to 5,909 7,140 6,398 customers Suspended interest (1,087) (1,063) (1,033) Specific provisions (2,480) (2,868) (2,573) 2,342 3,209 2,792 Gross non-performing advances as a percentage of gross advances to 3.4% 5.0% 3.9% customers 19. Supplementary information on Singapore The following table includes the results of all the Group's activities in Singapore. It has been prepared using the same principles as those used to prepare the geographical segmental information included in note 1. 6 months 6 months 6 months ended ended ended 30.06.01 30.06.00 31.12.00 SGDm SGDm SGDm Net revenue 396 368 385 Total operating expenses (177) (156) (143) Profit before provisions 219 212 242 Provisions for bad and doubtful (47) (14) (21) debts Profit before taxation 172 198 221 The information below is provided in the same format as the financial information given for Hong Kong, but has been prepared using the same definitions as those used for the Group. 30.06.01 30.06.00 31.12.00 SGDm SGDm SGDm Advances to customers (net) 11,603 11,504 10,907 Other assets 13,593 10,885 10,710 Total assets 25,196 22,389 21,617 Analysis of advances to customers Mortgages 5,430 4,643 4,927 Other consumer 1,380 1,439 1,459 Trade finance 774 915 883 Other 4,387 4,811 3,961 Provisions (368) (304) (323) Net advances to customers 11,603 11,504 10,907 Gross non-performing advances to 562 584 557 customers Suspended interest (110) (75) (91) Specific provisions (258) (229) (232) 194 280 234 Gross non-performing advances as a percentage of gross advances to 4.7% 4.9% 5.0% customers 20. Supplementary information on Malaysia The information below is derived from the 2000 Half Year and 2000 Annual Reports of Standard Chartered Bank Malaysia Berhad which were filed with Bank Negara Malaysia, and from the 2001 Half Year Report which will be filed with Bank Negara Malaysia. 6 months 6 months 6 months ended ended ended 30.06.01 30.06.00 31.12.00 MYRm MYRm MYRm Net revenue 460 478 480 Total operating expenses (180) (171) (252) Profit before provisions 280 307 228 Provisions for bad and doubtful (194) (12) (64) debts Profit before taxation 86 295 164 30.06.01 30.06.00 31.12.00 MYRm MYRm MYRm Advances and financing (net) 12,230 11,757 12,027 Other assets 8,507 8,329 7,569 Total assets 20,737 20,086 19,596 Analysis of loans and advances and financing Mortgages (excluding MYR 734 million of loans sold to Cagamas (30.06.00: MYR 796 million; 31.12.00: MYR 763 5,983 5,104 5,504 million)) Other consumer 1,348 1,104 1,281 Trade finance 1,349 1,604 1,345 Other 4,717 4,931 4,918 Provisions (1,167) (986) (1,021) Net advances to customers 12,230 11,757 12,027 Gross non-performing advances to 1,796 1,549 1,543 customers Suspended interest (276) (268) (282) Specific provisions (668) (498) (517) 852 783 744 Gross non-performing loans and advances as a percentage of gross 12.7% 11.4% 11.2% loans and advances 21. Supplementary information on India The following table includes the results of all the Group's activities in India. It has been prepared using the same principles as those used to prepare the geographical segmental information included in note 1. 6 months 6 months 6 months ended ended ended 30.06.01 30.06.00 31.12.00 INRm INRm INRm Net revenue 7,998 3,783 8,460 Total operating expenses (4,923) (1,903) (4,033) Profit before provision 3,075 1,880 4,427 Provisions for bad and doubtful (492) (743) (627) debts Profit before taxation 2,583 1,137 3,800 The information below is provided in the same format at the financial information given for Hong Kong, but has been prepared using the same definitions as those used for the Group. 30.06.01 30.06.00 31.12.00 INRm INRm INRm Advances to customers (net) 89,367 46,447 82,119 Other assets 150,356 42,543 125,406 Total assets 239,723 88,990 207,525 Analysis of advances to customers Mortgages 5,824 591 4,888 Other consumer 31,630 21,164 32,172 Trade finance 13,789 7,669 16,537 Other 43,901 20,298 34,504 Provisions (5,777) (3,275) (5,982) Net advances to customers 89,367 46,447 82,119 Gross non-performing advances to 7,870 4,475 7,514 customers Suspended interest (1,897) (871) (1,588) Specific provisions (3,880) (2,404) (4,394) 2,093 1,200 1,532 Gross non-performing advances as a percentage of gross advances to 8.3% 9.0% 8.5% customers 22. Selected information in sterling The information in this note provides a convenience translation of the Group's results in pounds sterling. Profits and losses for the six months ended 30 June 2001 have been translated from US dollar using the average sterling exchange rate during that period, whilst assets and liabilities have been translated at the rate of exchange ruling on 30 June 2001. Prior period comparatives are as previously reported. - Profit before taxation up 27 per cent to £452 million from £356 million to 30 June 2000 (31 December 2000: £593 million). - Operating profit before goodwill and restructuring up 34 per cent to £499 million from £372 million to 30 June 2000 (31 December 2000: £486 million). - Net revenue up 21 per cent to £1,519 million from 30 June 2000 (£1,254 million) and up 5 per cent from 31 December 2000 (£1,444 million). - Ongoing costs excluding goodwill and restructuring (£833 million) up 16 per cent from 30 June 2000 (£718 million) and 3 per cent from 31 December 2000 (£812 million). - Provisions up 14 per cent at £187 million from 30 June 2000 (£164 million) and by 28 per cent from 31 December 2000 (£146 million). - Normalised earnings per share up 26 per cent to 27.9 pence from 30 June 2000 (22.1 pence) and up 12 per cent from 31 December 2000 (24.8 pence). - Interim dividend per share increased by 20 per cent to 8.902 pence. 22. Selected information in sterling (continued) Summary of results for the six months ended 30 June 2001 6 months 6 months 6 months ended ended ended 30.06.01 30.06.00 31.12.00 £m £m £m RESULTS Net revenue 1,519 1,254 1,444 Provisions for bad and doubtful debts and contingent liabilities (187) (164) (146) Operating profit after goodwill and provisions but before restructuring 452 356 455 charge Restructuring charge - - (213) Profit on disposal of subsidiary - - 351 undertakings Profit before taxation 452 356 593 Profit attributable to shareholders 281 231 446 BALANCE SHEET Total assets 77,954 59,754 68,599 Shareholders funds: Equity 4,432 3,450 4,061 Non-equity 889 200 200 Capital resources 9,257 6,349 7,371 INFORMATION PER ORDINARY SHARE Pence Pence Pence Normalised earnings per share 27.9 22.1 24.8 Dividends per share 8.902 7.425 17.710 Net asset value per share 392.7 321.2 360.4 RATIOS % % % Post-tax return on ordinary shareholders funds - normalised 14.8 14.2 14.3 basis Cost to income ratio - normalised 55.0 57.4 56.4 basis Capital ratios: Tier 1 capital 8.8 9.3 7.0 Total capital 16.2 15.9 14.0 22. Selected information in sterling (continued) Consolidated profit and loss account For the six months ended 30 June 2001 6 months 6 months 6 months ended Ended ended 30.06.01 30.06.00 31.12.00 £m £m £m Interest receivable 2,361 2,041 2,514 Interest payable (1,369) (1,190) (1,578) Net interest income 992 851 936 Fees and commissions receivable, net 331 262 324 Dealing profits and exchange 173 115 134 Other operating income 23 26 50 527 403 508 Net revenue 1,519 1,254 1,444 Administrative expenses: Staff (429) (379) (536) Premises (104) (87) (112) Other (242) (197) (283) Depreciation and amortisation, of (105) (71) (125) which: Amortisation of goodwill (47) (16) (31) Other (58) (55) (94) Total expenses: - ongoing (880) (734) (843) - restructuring - - (213) Total operating expenses (880) (734) (1,056) Operating profit before provisions 639 520 388 Provisions for bad and doubtful (187) (164) (141) debts Provisions for contingent - - (5) liabilities and commitments Operating profit 452 356 242 Profit on disposal of subsidiary - - 351 undertakings Profit before taxation 452 356 593 Taxation (151) (114) (135) Profit after taxation 301 242 458 Minority interests (equity) (4) (4) - Minority interests (non-equity) (16) (7) (12) Profit for the period attributable 281 231 446 to shareholders Dividends on non-equity preference (8) (8) (8) shares Dividends on ordinary equity shares (102) (80) (200) Retained profit 171 143 238 Independent review report by KPMG Audit Plc to Standard Chartered PLC Introduction We have been instructed by the company to review the financial information set out on pages 14 to 32 and we have read the other information contained in the press release and considered whether it contains any apparent misstatements or material inconsistencies with the financial information. Directors responsibilities The press release, including the financial information contained therein, is the responsibility of, and has been approved by, the directors. The Listing Rules of the Financial Services Authority require that the accounting policies and presentation applied to the interim figures should be consistent with those applied in preparing the preceding annual accounts except where they are to be changed in the next annual accounts, in which case any changes and the reasons for them are to be disclosed. Review work performed We conducted our review in accordance with guidance contained in Bulletin 1999/4: Review of interim financial information issued by the Auditing Practices Board. A review consists principally of making enquiries of Group management and applying analytical procedures to the financial information and underlying financial data and, based thereon, assessing whether the accounting policies and presentation have been consistently applied unless otherwise disclosed. A review is substantially less in scope than an audit performed in accordance with Auditing Standards and therefore provides a lower level of assurance than an audit. Accordingly, we do not express an audit opinion on the financial information. Review conclusion On the basis of our review we are not aware of any material modifications that should be made to the financial information as presented for the six months ended 30 June 2001. KPMG Audit Plc Chartered Accountants 1 August 2001 The financial information included herein has been derived from the audited and unaudited information contained in the Group's Report and Accounts for the year ended 31 December 2000. Statutory accounts for 2000 have been delivered to the Registrar of Companies. The auditors have reported on these accounts; their report was unqualified and did not contain a statement under Section 237(2) (accounting records or returns inadequate or accounts not agreeing with records and returns) or 237(3) (failure to obtain necessary information and explanation) of the Companies Act 1985. Copies of this statement are available from Investor Relations, Standard Chartered PLC, 1 Aldermanbury Square, London, EC2V 7SB or from our website on www.standardchartered.com. For further information please contact: Pamela McGann, Group Head of External Affairs on (020) 7280 7245; or Tim Halford, Director of Corporate Affairs on (020) 7280 7159; or Stephen Seagrove, Head of Investor Relations on (020) 7280 7164 Application has been made to The Stock Exchange of Hong Kong Limited for listing of and permission to deal in the shares of Standard Chartered PLC. This document is not an offer of securities for sale in the United States. The proposed offering mentioned has not been and will not be registered under the US Securities Act of 1933. Any securities offered by Standard Chartered may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.

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