It reported a 35 per cent fall in first half profits to pounds 271m yesterday. But Standard is bullish. Chief executive Rana Talwar claims the bank has hit the trough and recovery is around the corner. The optimism is based on forecast growth rates for South East Asian countries of up to 3 per cent this year, compared to an 8 per cent fall in 1998. Mr Talwar also promises that the non-Swiss trade finance arm of UBS, acquired earlier in the year, will make a positive contribution to profits by the end of the year.
The recent acquisitions of Bank Bali and the planned takeover of Thailand's Nakornthorn Bank are also expected to speed the recovery. The market clearly believes in Mr Talwar. Standard's shares, at 941p, are only just off their recent high of 1135p and hovering at their levels just prior to the Asia crisis. But there is no reason to suppose the growth rates of earlier this decade will re-emerge. Betting on Asian recovery is risky and at these levels the shares are best avoided.