Standard Chartered says UK is 'less enticing'
Thursday 03 March 2011
Standard Chartered warned yesterday that muddled rules and the banking levy were making the UK a less attractive base for its booming business as the bank racked up its eighth straight year of record profit.
The bank's pre-tax profit rose 19 per cent to $6.1bn (£3.7bn) as business surged in India, China and the Middle East. The emerging-markets lender was the only UK bank to boost profits through the credit crisis.
Peter Sands, the chief executive, said the Government's £2.5bn bank levy would cost Standard Chartered $180m next year and that 90 per cent of that would cover items outside the UK. He said the bank wanted to stay headquartered in London but that the levy made Britain "less enticing".
HSBC complained on Monday that more than two-thirds of its $600m bill for the levy covered non-UK business. Unlike HSBC, which moved to Britain in 1992, Standard Chartered has been in the UK since its foundation in the 19th century.
Mr Sands singled out the Financial Services Authority's tough liquidity rules as an example of inconsistent international regulation that could have "unintended consequences".
The FSA plans to introduce rules on liquid assets that are stricter than the Basel III international standards that take effect by 2019.
Mr Sands said: "It's pretty clear where Basel III is roughly going to come out. It seems a bit odd to go way beyond it and come back again."
Richard Meddings, finance director, said the FSA's was "a remarkable position" that could constrain UK banks' ability to lend to customers.
Mr Sands revealed he would get a bonus of £2.16m for 2010 after donating 2009's to charity. The bank's bonus pool last year was £770m, up from £750m, with all the top five non-board earners outside the UK.
The bank's shares rose 70p, or 4.3 per cent, to 1,688p.
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