Standard Chartered reported a 6 per cent increase in pre-tax profits in the first quarter of 2022 as growth in trading income and transaction banking helped offset a volatile environment in its main Asian markets.

The UK-based lender said on Thursday that statutory profits before tax were $1.5bn for the first three months of the year, which exceeded analyst expectations of just over $1bn, and sent its shares up more than 10 per cent in Hong Kong.

Standard Chartered’s results outperformed those of its larger rival HSBC, which this week revealed its profits fell more than a quarter in the first three months of the year as a result of the war in Ukraine and slowing growth in its core Asia markets.

Bill Winters, Standard Chartered chief executive, said the bank’s performance was “strong despite the volatile macro environment”. He added: “We are on track to deliver 10 per cent return on tangible equity by 2024, if not earlier.”

The emerging markets-focused bank reported underlying operating income of $4.3bn, which beat analyst estimates of $3.8bn. Financial markets income rose 32 per cent, boosted by its commodity business, which benefited from rising energy prices.

However, wealth management income dropped 18 per cent, in part because of the impact of Covid-19 restrictions in its largest market Hong Kong, as well as in mainland China, where strict pandemic policies led to branch closures.

Asia profits dropped 26 per cent owing to larger credit impairments of $227mn as a result of the bank’s exposure to a slowdown in China’s property market and a sovereign rating downgrade of Sri Lanka.

Standard Chartered is exiting seven countries across Africa and the Middle East to focus on faster-growing markets. The lender is also betting on China, where it will invest $300mn to expand, particularly in wealth management.

Standard Chartered said it “remained alert to the challenging external environment” including pandemic restrictions in critical markets including Hong Kong and China, and the impact of the Russian war in Ukraine.

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