Standard Chartered to boost Hong Kong staff as it turns bullish on Greater Bay Area, green finance, CEO Mary Huen says
- Standard Chartered will hire 300 to 500 additional staff in Hong Kong this year to tap the growth in loan and wealth management demand this year
- The bank’s operating income has returned to the pre-Covid level of US$3.76 billion in 2019, while the outlook for 2023 appears positive
The London-headquartered bank, which makes most of its profit from emerging markets, will hire 300 to 500 additional staff to add to its current headcount of about 5,800 in Hong Kong, CEO Mary Huen Wai-yi said.
Hong Kong companies are among the world’s fastest hiring firms, a new study by human resources platform Deel released last week showed. Hong Kong ranked sixth in the world in terms of organisations’ rate of hiring, and second only to Australia in Asia-Pacific.
The three-year long Covid-19 pandemic has hard hit banks and other businesses, but the worst is over after the government relaxed social distancing measures since September when the disease was brought under control.
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Standard Chartered on Thursday reported a net profit of US$2.55 billion last year, compared with US$1.91 billion in 2021. The bank’s business in Hong Kong, its largest market, reported an 8 per cent growth in operating income to US$3.72 billion last year.
Huen said the operating income in Hong Kong has returned to pre-Covid level of US$3.76 billion in 2019.
“This shows the worst is over,” she said. “The higher interest rate has widened the interest margin and income, while the improved market sentiment in recent months has also brought in more fee income.”
However, the strong income growth was offset by US$617 million of bad debt provision in Hong Kong, 147 per cent higher than a year earlier. This includes US$579 million of credit impairment made for the mainland’s real estate market, more than double the US$251 million a year earlier.
Mainland developers such as China Evergrande Group, China Fortune Land Development and others have defaulted on loans and abandoned projects in the wake of Beijing’s “three red lines” policy introduced in August 2020, which was aimed at reining in excessive leverage and hot money flows. This has led to an increase in banks’ bad debts.
But Huen said measures introduced by China late last year to support the sector will help prevent banks to set aside more bad-debt provisions.
Beijing unveiled a liquidity package last November dubbed the “three arrows” – bank credit, bond issuance and equity financing – aimed at boosting home sales.
Huen said she expects loan growth to increase this year on the back of an economic revival following the border reopening and development of the Greater Bay Area. Standard Chartered’s loans made to customers in Hong Kong fell 4 per cent last year to US$85.4 million.
“Many businesses were cautious last year as there were a lot of uncertainties on the interest-rate movement and the pandemic,” Huen said. “But now the interest-rate rise cycle is close to the peak, the border has reopened and Covid-19 [pandemic] is more under control. This will encourage companies to borrow to develop their business this year.”
