Amid Covid-19 induced market jitters, statutory profit at the private banking arm of Standard Chartered has almost halved in H1 2020.

Private banking highlights

Statutory pre-tax profit at the private banking unit in the first six months of 2020 was $53m, versus $99m a year ago.

A non-repeat of a prior-year impairment release resulted in underlying pre-tax profit slumping 44% year-on-year to $56m.

Operating income of $300m was 2% lower than the previous year, driven by a decrease in Retail Products, primarily Deposits.

This was offset by growth in Wealth Management, where income rose 5% to $204m from $195m.

Operating expenses at Private Banking dipped 6% to $239m from $253m.

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Standard Chartered group CEO Bill Winters said: “I am pleased we have come through the extremely challenging early stage of the COVID-19 crisis with a clean bill of operational health, higher income and lower costs.

“Despite having taken significantly higher impairment charges we remained profitable and enter the next phase of the crisis with our CET1 capital ratio at one of the highest levels for many years.

Group falters

With a surge in credit impairments amid the Covid-19 crisis, Standard Chartered’s Q2 underlying profit before tax plunged 40% year-on-year to $733m at a group level.

Credit impairments increased to $611m in Q2 2020 from $176m in Q2 2019.

Underlying operating income dropped 4% to $3.72bn from $3.88m.

The group’s underlying pre-tax profit in the first six months of June 2020 was $1.95bn, a 25% slump from $2.61bn last year.