Through this these numbers it's better than the market had expected. What was the standout I was sneaking suspicion it's an
energy trading. Can you confirm that. So thank you. Good morning. We've had a great start to the year.
So you are. Income was off 9 percent in the first quarter and insights on an underlying basis. That's the best print we've had
for about seven years. Our underlying profit was up ISE percent and our capital ratios on our capital returns were also very
very strong. So we've actually upgraded our guidance for the full year.
Underpinning that very strongly is the performance we've had in financial markets. So the rates and assets business with all the
volatility has been out there. They have talked about the quarter and that is more than offset slight weakness in the
wealth management space. So overall a really really strong start. So we're very very encouraged by it. Andy I do have to
wonder given that a lot of this is due to volatility in financial markets around the war in Ukraine. Are these the type
of results that can be repeated. Well the volatility I don't think is going away any time soon.
Now whether we'll be at the same height levels as we saw particularly over the last few weeks particularly in the month
of March I guess is very debatable but also insist that volatility is likely to be quite a different time and hence why
we've said the full year out certain for us looks pretty promising.
With HSBC they said that they had a terrible charge to deliver for the market in terms of rates. Do you have the turbocharger
in terms of rates expectation for the bottom line for Standard Chartered. And you've often complained that you were suffering
at a low rate environment. What did you turbo a Ferrari. Well whether it's Ferrari Lamborghini I don't know. But yes it
certainly is. It's really really really helpful. Scorers in the last two years has been abnormally low rates as we all know. And
that's been very difficult trying to keep the US rates to sort of like 2 percent just the past. And now seeing that sort of
cuts too deep maybe 3 percent. And in part that's why we set that target of getting our returns of 10 percent by 2024. Yes
there's an outside chance we could get there a bit earlier. Right. Does. Hold on. So Andy
you say it's going to benefit you but puts some numbers on it. How much is going to benefit. UBS says one billion dollars.
Credit Suisse said it would benefit them 150 million dollars if we get the Fed going the full Monty. Yeah yeah
yeah. So we have said that the next two or three years as we came down it's a class on rate. Security costs is about 2
billion dollars on top line and seeing those rates curve revert back to where we were previously. We see no reason why we
shouldn't see a second of that coming back into our numbers over the next couple of years.
The natural corollary to that then is buyback HSBC were gloomy on the buyback. It's an aggressive upswing but they weren't
promising you know a glass half full with everything you've just said to us. Will you push forward. Will you upgrade your
guidance on buybacks. What narrative on dividend and buybacks can you give to the market this morning.
So we are going to throw in a seven hundred and sixteen million dollar buyback program where about 80 percent of the way through
it. So that's always see real run through that or complete tonight's few weeks. We said in February that the next three
years we intend to return at least five billion dollars. That would be buybacks and dividends over the three year period. And
that is continuing to be also. So someone incestuous starts about an over a period of time. We'll have the dividend coming
next. We'll look at the buyback consent short at a particular each half year and decide what is appropriate. But that is very
central to getting our influence off is returning capital to shareholders.
And one thing which Danny and I are looking at are your financial markets revenue. Obviously very comfortable. I said it
to you at the start. It looked like it was commodity trading more than doubled.
You're benefiting from volatility. Is that to do with energy and commodity trading. I mean is that
where this big beat comes from. So are commodities performance has been very strong as you say
parts of that is energy passed its minerals and bearing in mind where we all presence in the world to clients. We've got
commodities that's always been a reasonable part of our portfolio. And in previous years people have been concerned that
the downside with Scotch price to speak low. We're now in a period where prices are higher and credit just sits at us during
the period. And one perhaps rough point in the quarter was wealth management
down 17 percent Hong Kong down 26 percent. Given 0 Covid in China given the volatility in general in Asia are you seeing
clients who are fearful who are just sitting this out. So overall as you go back over about a 10 year period we've had
a great run on the wealth management. This first quarter has been more tricky. About a third of all global income and wealth
management is in the Hong Kong region. And two things really happened in court. So the first was coded spiked and people were
not able to get outside the fence etc.. And that obviously reduced some of the sales activity we had. And secondly with the
markets being very turbulent it did cause a number of our clients and clients elsewhere. I think just be more cautious
about the market. So overall we are about 200 million lower on our income in wealth management than we were a year ago albeit
only several levels to levels we've had in the last two or three quarters. I think going forward seeing now progressively from
pouring out of the Covid situation that will be helpful. Market sentiment as you said before I came on I think it starts to pick
up. So hopefully for the period of the next few quarters we'll start to see that rebuilding.
And we can't let you go with these markets are moving aggressively. Bonds the biggest losses on record this month
dollar yet. Look at it. No one 30 10 is broken 130. Yuan's on a trashing mission. These devaluations in these currencies what's
the risk. How does it translate for you. Well I think for us the volatility on currency is generally
good. Our clients often looking to hedge their positions and we will facilitate that. So there's a big question is what does
this do overall to politics. Play play at a moment holding out in our region but please remain vigilant on that front. But
overall we've been really pleased the start of this year. I mean again we still have seen bank after bank warn of material
deleveraging in Asia. And part of it is this story. This this concern the scare over the economy over interest rate
differentials. What do you do to avoid that scenario or enough buffers in place to avoid any form of exodus.
Yes I think so. We operate in a large number of markets where in around 60 countries around the world. And that actually gives us
a broad spread across different geographies. Overall as I say demand is still holding out. We had increases in art lending to
customers or exposures to customers on underlying basis. In the last few months. But I think we should step up to the bank
overall the rates being higher. And your only question really is very cheap seat care. And even if there's a bit of softening of
demand the right support will be considerable. So so but outflows Andy is that is that. Are we expecting that
to come from China. Well I think in China whilst the GDP outlook expectations have
been lowered slightly. Our business is much more so to support and so a cross-border trade. And therefore it's actually brought
the level of export and import activity such a state source. And that has been very very strong over recent quarters. So we
continue to be very positive about China as a region. Our business in China. And we will continue to do everything we can
to help our clients to navigate the changes that are going on. But underlying fully expect to see that still strong. Only there
was one closing line in you and your statement which was on real estate. HSBC said it is too soon to call an end to the pain and
commercial property. You've taken another another line today. Is that pain done.
Are we at the end of that cycle. Are you concerned that it could be a more material shift lower in the commercial property cycle
in China. So we are obviously keeping a close eye on AIDS. It's not fully gotten
through its cycle but I think we are a large ways for it. So hopefully next few courses will fully settle down. But overall
it's one sector in a very big portfolio that we've got. We've taken some reserves not huge reserves of reserves but hopefully
next few causes rules to settle.