AGM Statement

Standard Chartered PLC
08 May 2003

Standard Chartered Bank PLC

AGM Statement

May 8 2003

Excerpts from the speech made to shareholders by Sir Patrick Gillam, Chairman,
Standard Chartered Bank PLC at the Annual General Meeting held today at 12.00
noon in London.


'Last year I told you that we were well positioned to grow our business as the
Asian markets recovered from the economic turmoil of the late 1990s. Our results
show this has been the case.


The 2002 results show a 16 per cent rise in trading profit to US$1.26 billion
and an increase in net revenue of 3 per cent.

A number of factors contributed to this strong performance. We saw:

  • strong growth in consumer banking, outside of Hong Kong

  • a good performance on costs, and

  • an exceptional performance on bad debts.

I have always said to you that our dividend policy was to share wealth with
shareholders when we made it. Therefore, the Board is delighted to recommend an
increase to the dividend. The final dividend will be 32.9 cents per share,
compared with 29.1 cents per share in 2001. This gives a total dividend of 47
cents, an increase of 12 per cent.

You will have noticed that this year's Directors' Remuneration Report contains
additional material. This reflects changes made by the Department of Trade and
Industry to the way in which executive compensation is reported.

Since the report was published, we have also signaled our intent to change
directors' contracts to remove the change of control clause so that all current
directors have twelve-month contracts.

In addition, we have revised the shareholding requirement of executive directors
and senior managers to make them simpler. These changes together with the
revised remuneration report itself are consistent with our objective of adhering
to the highest standards of corporate governance.

We completed the integration of Grindlays in India, the Middle East and South
Asia in 2002. This acquisition has transformed the Bank. Today we are the
largest foreign bank in India, Pakistan, Bangladesh and Sri Lanka; and the
second largest foreign bank in the Gulf region.

India contributes more than US$150 million in trading profit per year, and the
United Arab Emirates is now contributing more than US$100 million. This
materially diversifies the Bank's range of core markets. We are continuing to
see strong growth in India and will have opened 23 new branches there by the end
of this year.

During 2002, we made excellent progress in developing our two service centres in
Chennai and Kuala Lumpur. These are centres that process transactions for our
consumer and wholesale banking businesses. They also support internal functions
like finance, technology and human resources. We expect these service centres to
deliver substantial cost savings in the coming years. We are enormously proud of
the speed and efficiency of this project, which is reflected by the number of
banks that are keen to follow our example.

In July last year, we took a US$50 million stake in the initial public offering
on the Hong Kong Stock Exchange in shares of the Bank of China Hong Kong. It is
a subsidiary of the Bank of China, one of the largest state-owned commercial
banks. We have since signed a Memorandum of Understanding with them in which we
identified eight areas for alliance on products and distribution in the mainland
and internationally.

In October 2002, we listed our shares in Hong Kong. As one of the three
note-issuing banks this listing on the Stock Exchange was a further
demonstration of our commitment to Hong Kong and China. The listing will help us
to expand our shareholder base to include both Asian institutional and retail
investors. The offer was comfortably over-subscribed.

In recent months we have had to contend with major issues affecting two of our
core regions: war in the Middle East and the SARS virus in East Asia:

  • The Iraq war. Fortunately, the war was short, as we had hoped and has had
    virtually no impact on our business. We expect healthy growth in the region
    for the rest of the year.

  • The SARS outbreak was completely unexpected. The World Health
    Organisation's comment - that the outbreak has passed its peak in Hong Kong
    and Singapore - was a heartening piece of news. However, there has already
    been an impact on the economies of East Asia. From our perspective, there
    are three potential issues:

 1. The possible credit loss from lending to the most directly affected sectors,
    notably airlines, hotels, retail, tourism and restaurants. Our exposure to
    these industries is limited and well secured.
 2. The impact on the demand for banking services from reduced economic activity
    and thus reduced GDP growth. It's very hard to know what this will amount
    to. Clearly it depends on how long it lasts. It is also too early to tell
    whether there will be an increase in unemployment, that could in turn lead
    to an increase in personal bankruptcies. For the first quarter of this year,
    we continued to see a reduction in these bad debts to US$48 million, from
    US$64 million in the last quarter of 2002. Our overall share of the personal
    bankruptcy problem in Hong Kong continues to fall.
 3. The practical challenges of trying to keep our staff as safe as possible and
    to preserve business continuity. We have taken a number of sensible internal
    measures.

While there have been these major issues in the Middle East and Asia, Africa is
one region that has benefited from an improved economic environment. It has seen
continued economic reform, a softer dollar and higher commodity prices.

The biggest exception to a successful year for our colleagues in Africa was
Zimbabwe. However we remain committed to our operations in that country.

To sum up, the outlook at the end of the first quarter, is that we have
continued to make positive progress against our performance targets.

This year's AGM is a very special occasion for the Bank because 2003 marks our
150th year in business. It is also special for me because after ten very happy
years, this is my last AGM. I will step down today after 10 years as Chairman. I
am delighted to welcome Bryan Sanderson as my successor. I am confident Bryan
will take this company forward to even greater success.

We are part of the fabric of the communities in which we operate around the
world, so we are using our anniversary to launch two initiatives to put
something back. We have launched an HIV/AIDS education awareness programme
worldwide. Our aim is to make every member of our staff aware of the need to
combat HIV.

We have also launched 'Seeing is Believing', jointly with Sight Savers
International. Our aim is to raise enough funds for cataract operations for
28,000 people around the world.'


                                    - Ends -


For further information:

Standard Chartered Bank
Paul Marriage
Head of Media Relations               020 7280 7163

Caoimhe Buckley
Media Relations Manager               020 7280 6170


                           www.standardchartered.com



Note to Editors:


         Standard Chartered - the world's leading emerging markets bank

Standard Chartered is the world's leading emerging markets bank. It employs
29,000 people in over 500 offices in more than 50 countries in the Asia Pacific
Region, South Asia, the Middle East, Africa, United Kingdom and the Americas.


The Bank serves both Consumer and Wholesale banking customers. Consumer Banking
provides credit cards, personal loans, mortgages, deposit taking and wealth
management services to individuals and small/medium sized businesses. The
Wholesale Bank provides services to multinational, regional and domestic
corporate and institutional clients in trade finance, cash management, custody,
lending, foreign exchange, interest rate management and debt capital markets.


With 150 years in the emerging markets the Bank has unmatched knowledge and
understanding of its customers in its markets.


Standard Chartered recognises its responsibilities to its staff and to the
communities in which it operates.


                                    - Ends -




                      This information is provided by RNS
            The company news service from the London Stock Exchange