STANDARD CHARTERED ADR

Strong Q3 performance; upgraded 2026 outlook - Income +14% YoY to $5.8bn; PBT +29% YoY. - Pre-provision operating profit +22% to $2.4bn (operating leverage: income growth outpacing expense growth). - Upgrades: full-year income growth now expected above 5–7% (ex-notables) and RoTE ~14% (up from prior “>12%” guidance). - Capital return momentum: EPS +27% YTD; confidence to deliver high-teens EPS CAGR to 2028.

Guidance specifics: NII, costs, profitability (clear “what to expect”) - Net interest income (NII): Q3 trends continue; full-year NII growth upgraded to ~4%. - Drivers to watch: mix/term deposit margin compression, headwind from WRB portfolio exits, but partly offset by rate benefits and ongoing volume growth (with moderation expected later in the year). - Costs: Q3 expenses +9% YoY; Fit for Growth booked $128m in Q3 (program tracked to close in 2026). - Cost/income approach: for 2026 cost/income (ex-notables) expected ~60% (about 300 bps improvement vs 2025), targeting ~57% by 2028. - Management expects positive jaws each year of the plan (cost growth not preventing RoTE expansion).

Credit quality: resilient despite geopolitical overlays (with one negative-ish signal) - Total credit impairment $90m (includes $34m net overlay related to the Middle East conflict). - New overlay: $63m (expanded scenario impacts, incl. higher oil prices) offset by $29m releases (petrochemicals/sovereigns, portfolio moves). - WRB impairment $114m, broadly flat Q/Q; overall loan loss rate YTD ~20 bps (vs RoTE underwriting through-the-cycle 30–35 bps). - Surprising/positive: despite overlays and higher-rate/oil/geopolitical risk context, impairments remain below long-run assumptions so far. - Risk check: no change yet to through-the-cycle cost of risk guidance—management says it’s premature to reduce assumptions until a clearer credit-cycle turn appears.