London-based Standard Chartered recorded $1.4 billion in pre-tax profit for the first quarter of 2021, the bank announced Thursday, up from consensus estimates of $985 million as the lender with a strong presence in emerging markets successfully fought off lower rates and a pandemic-induced economic slowdown.
The bank reported $1.03 billion in net profit in the first quarter, more than twice as much as it earned over the same period last year.
"Economic recovery advanced in many of our markets leading to improved transaction volumes and profitability," Standard Chartered CEO Bill Winters said in a statement.
"This was the case particularly in our Financial Markets and in Wealth Management, which had its best ever quarter," he also noted.
Like competitor HSBC Holdings, winter is focusing on strengthening its wealth management business in Asia which is a major revenue driver for both banks. Operating income for Standard Chartered's wealth management unit grew 21% in the first quarter of 2021 to reach a record high of $641 million.
Standard Chartered expects income to start growing again in the second half of 2021, while expenses for the full financial year will likely increase slightly year on year as the bank ploughs resources into digital upgrades.
"We believe that some of our larger markets will continue to drive the global economy out of recession over the coming quarters," the lender noted in its quarterly earnings report.
Standard Chartered set aside $17 million for bad loans in the first quarter, which pales in comparison to the roughly $962 million the bank reserved for deteriorating credit over the same period last year.
This grew to $2.3 billion by the end of 2020 as the COVID pandemic wrought havoc on economic activity around the world.
In keeping with its mission to reduce costs and streamline business this year, Standard Chartered announced on Thursday plans to cut office space by a third. The lender also plans to halve the number of bank branches worldwide - a reduction of roughly 400 locations.
Flexible work from home arrangements will continue to help trim costs even as the pandemic is brought under control.
