Standard Chartered at a Loss of Profits – Lloyds Encouraged

Hongkong, London Several British banks released quarterly figures this Thursday. At Standard Chartered Bank, loan defaults and low interest rates have depressed profits. Adjusted earnings before taxes fell 40 percent to $ 745 million for the third quarter, such as Standard Chartered communicated. The money house, which is mainly active in Asia, increased its provision for bad loans by 27 percent to $ 358 million compared to the same period last year.

This meant that the burden of loan defaults was significantly lower than in the second quarter, when a good $ 600 million was posted. Analysts had expected a similarly high burden for the third quarter. “Lower interest rates continue to have an impact on revenue, but we are well positioned to meet our financial targets – albeit with a little delay,” said CEO Bill Winters.

Less risk provisioning at Lloyds

British bank Lloyds is seeing light at the end of the tunnel after returning to the black. “Although our business was severely affected by the corona pandemic, we are seeing an encouraging recovery,” said Lloyds boss António Horta-Osório on Thursday. In the summer quarter, mortgage lending business in particular boomed, and the bank no longer had to set aside as much for bad loans as in the first half of the year. However, earnings declined due to low UK interest rates. The Bank of England has lowered its key rates to close to zero because of the corona crisis and is even considering negative rates like the European Central Bank.

Lloyds adjusted earnings declined more than a third to £ 1.16 billion last quarter. Before tax, the UK’s largest retail bank earned £ 1.04 billion after £ 50 million in the same period last year. At that time, the result was burdened by billions in the cost of compensating customers for unlawfully taken out credit default insurance. Analysts had expected a significantly lower net profit.