Mr Talwar said the group's revenues would be lower for the second half of 1998 because of dull lending conditions and lower earnings from the bank's Treasury division. The shares dropped 28p to 667p, valuing the company at around pounds 6.9bn.
"The long-term prospects are good but the problems in Asia are far from over and there is certain to be further volatility in the foreseeable future," Mr Talwar said.
City analysts said traders were taking profits after a mild trading statement in October, when the bank said there had been no new debt problems of any size in the third quarter. Shares have risen from a low of 375p earlier this year.
"Some people were expecting it to be a smooth ride upwards and Talwar's view was that for the next 18 months it would still be fairly bumpy before it picks up," said one analyst.
Industry observers said further falls in the share price would increase the group's vulnerability to a takeover bid.
The group has been linked to several groups in recent weeks, including Barclays.
"Standard is an attractive franchise and there's no doubts about its operation in Asia. That means its valuation is not excessive at this share price," said John Yakas of Fox-Pitt Kelton, the brokerage firm.
Mr Talwar said bad debts were small in spite of the Asian crisis. Only 0.3 per cent of mortgages in Hong Kong were three months in arrears. That compares with a figure of more than 2 per cent at big British lenders.
A spokesman for Standard Chartered said the statement had been issued to give clearer guidance to shareholders because earnings forecasts ranged between pounds 700m and pounds 800m.
Some analysts cut their forecasts yesterday. Michael Trippitt of Schroders, who had estimated pounds 794m, now predicts just pounds 760m.
Ian Poulter of William de Broe said he would re-consider his estimate of pounds 810m.Reuse content