Sector movers: Standard Chartered profits hit $4bn
Banks are flavour of the moment after Standard Chartered announced profits that exceeded market expectations.
Profit before tax rose to U$4bn in 2007 from U$3.2bn in 2006 on operating income that rose to U$11.1bn from U$8.6bn. Analysts had been expecting pre-tax profits to come in at around U$3.93bn.
Impairment losses for the group rose to U$761m from U$629m. The group took a U$300m hit on Whistlejacket, the structured investment vehicle, and on its asset securitisation profile.
The group’s tier one capital ratio rose to 9.8% from 8.3% (restated) in 2006. The ratio of customer loans to customer deposits stood at 86% at the end of 2007, while 24% of the group’s assets are described by the chief executive officer (CEO) as being “highly liquid”.
The ratio of cost to income increased to 56.0% from 55.2% in 2006.
“Standard Chartered has shown how its position in the world's growth markets and the strength of its balance sheet can deliver record results during turbulent times,” claimed the bank’s chairman, Mervyn Davies. “We are not complacent about the future but are confident that we will deliver another strong performance in 2008,” added Davies.
Power supplier National Grid is still down in the dumps today after being fined £41.6m by industry regulator Ofgem for a “serious” breach of competition law that restricted the development of competition in the domestic gas meter market.
“National Grid has abused its dominance in the domestic gas metering market, restricting competition and harming consumers,” said Ofgem chairman Sir John Mogg.
“The abuse has prevented suppliers from contracting with other companies for cheaper metering deals and could discourage suppliers from installing smart meters,” he added.
The fine is the largest ever handed out by Ofgem.
National Grid bosses said they were “extremely disappointed” with the decision relating to the metering contracts entered into with gas suppliers in 2004.
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“We are convinced that the contracts do not infringe competition law and therefore believe that they should remain in full effect,” it said.
The company also reckons the fine is “wholly inappropriate” and will be lodging an appeal with the Competition Appeal Tribunal.
Top performing sectors so far today
Automobiles & Parts 4,505.30 +4.67%
Forestry & Paper 4,101.20 +4.17%
Banks 8,452.10 +3.18%
Insurance (non-life) 1,251.30 +2.42%
Life Insurance 4,918.70 +2.32%
Bottom performing sectors so far today
Gas, Water & Multiutilities 4,723.80 -0.65%
Media 3,691.40 -0.05%
