Citigroup: Standard Chartered's Q4 Underlying Profit Misses, Capital Returns Outperform

Stock News
5 hours ago

Citigroup released a research report noting that Standard Chartered's new fiscal year 2026 targets suggest market consensus revenue estimates will be revised upwards, but underlying operating expenses are also expected to increase. The new statutory target for return on tangible equity is over 12%, which is broadly in line with market consensus of 11.7%. Overall, the bank views Standard Chartered's results as mixed, reiterating a "Neutral/High Risk" rating with a target price of HKD 186. For the fourth quarter of 2025, Standard Chartered's adjusted pre-tax profit, excluding restructuring and debt valuation adjustments, was USD 1.2 billion, 6% below market consensus. This was attributed to revenue being 1% lower than expected, with net interest income 8% higher but non-interest income 11% lower. Operating expenses were 4% higher than anticipated, while loan impairment charges were 36% better than expected. Statutory pre-tax profit was USD 800 million, 23% below consensus, primarily due to increased restructuring costs. The Common Equity Tier 1 ratio stood at 14.1%, remaining stable quarter-on-quarter despite dividends and share buybacks exceeding expectations.

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