Jump to
Standard Chartered reported better than expected first quarter profits on Thursday, buoyed by the higher interest rate environment and the strong performance of its wealth business.
The bank’s pre-tax profits rose 5.5 per cent year on year to $1.9bn for the first quarter, coming in well ahead of an average forecast of $1.4bn from 13 analysts compiled by the bank.
Income at the bank’s wealth business rose by 21 per cent to $616mn from $511mn in the previous quarter, with the bank taking on 62,000 new high-net-worth clients.
“We remain confident in the delivery of our financial targets and are maintaining our full-year 2024 guidance,” said chief executive Bill Winters in the bank’s earnings statement.
Yet the bank also reported a sharp rise in credit impairments to $165mn, compared with $20mn in March 2023, mostly attributed to its wealth and retail operations, thanks in no small part to the slowdown in China’s economy.
—
Barclays is reported to have begun cutting hundreds of jobs, including within its investment banking division, as part of efforts to cut costs and bolster its share price.
Bloomberg reported that the cuts, which began on Wednesday, will impact several hundred employees in the bank’s global markets, investment banking and research divisions, citing unnamed sources.
“We regularly review our talent pool to ensure that we can invest in talent and deliver for clients,” the bank said in a statement to the newswire.
Barclays said in January that it had cut 5,000 jobs worldwide in 2023 to “simplify and reshape the business”, as part of its largest restructuring since the financial crisis.
—
Federal Reserve chair Jerome Powell has said that further interest rate rises are “unlikely” in the face of stubborn inflation, as the US central bank kept rates on hold following its meeting on Wednesday.
Powell noted a “lack of further progress” toward reducing inflation, with consumer prices rising to 3.5 per cent over the 12 months to March, ahead of the Fed’s 2 per cent target, dampening hopes for interest rate cuts in the near future.
“It really will depend on the data,” he said in response to questions about when the bank was likely to reduce interest rates.
“It’s going to take longer to reach that point of comfort. I don't know how long it will take.”
US interest rates have remained at 5.25 per cent — their highest level in 23 years — since last July.
—
A court in Russia has cancelled the seizure of a portion of JPMorgan’s funds in the country as part of a lawsuit brought against it by local lender VTB.
The ruling applies to funds held by JPMorgan in so-called type C accounts which cannot be transferred out of Russia, and in a current account used to pay staff and taxes, according to court documents seen by Reuters.
The seizure of funds held in JPMorgan accounts was originally ordered by the court after VTB sued the bank for $439.5mn, the amount the Russian bank says was blocked by JPMorgan in its correspondent account in New York when the Russian lender came under US sanctions.
In a filing on Wednesday, JPMorgan said that the value of claims against it and orders to freeze its assets was greater than its available assets in Russia.
