HONG KONG/LONDON: Standard Chartered (StanChart) on Thursday said third-quarter pre-tax profit fell by a third, much worse than analysts had expected, as it took a nearly $1 billion hit from its exposure to China’s real estate and banking sectors.
StanChart, which earns most of its revenue in Asia, said statutory pretax profit for the third quarter of this year fell to $633 million.
That compared with $996 million a year earlier and the $1.41 billion average of 16 analyst estimates compiled by the bank.
Credit impairment charges rose by $62 million from the same period a year prior to $294 million, as the bank took a $186 million charge related to China’s troubled commercial real estate market.
The bank also took a $700 million hit from its stake in China Bohai Bank, which it said reflected subdued earnings at the lender and the challenging economic backdrop.
Its total China real estate exposure stood at $2.7 billion, down $200 million from the previous quarter.
The Chinese economy, despite a raft of government easing measures, remains fragile as crisis in its property market deepens with high-profile debt-repayment defaults and the absence of state support.
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