Financial Data and Key Metrics Changes - The company reported a 9% growth in profit before tax, supported by a 5% increase in income [2][3] - Operating income reached $5.1 billion, up 5% year-on-year, while operating expenses increased by 4% [3][4] - Profit before tax was $2 billion, reflecting a 9% increase, and tangible net asset value per share rose by $0.175 year-on-year [4][5] - The return on tangible equity is now expected to be around 13% in 2025, upgraded from previous guidance [3][11] Business Line Data and Key Metrics Changes - Corporate and Institutional Banking (CIB) income was $3 billion, up 2% year-on-year, driven by a 23% increase in global banking income [8][10] - Wealth and Retail Banking (WRB) income increased by 7% to $2.3 billion, with wealth solutions income up 27% [10][11] - The affluent business onboarded 67,000 new clients in the quarter, contributing to a total net new money of $42 billion year-to-date [11] Market Data and Key Metrics Changes - Underlying loans and advances to customers increased by 1% or $2 billion quarter-on-quarter, with a 4% growth year-to-date [6][7] - Underlying customer deposits rose by 2% or $11 billion quarter-on-quarter, primarily from WRB [7] Company Strategy and Development Direction - The company is focusing on servicing clients' cross-border and affluent banking needs, with a strategic emphasis on wealth management [3][11] - The company plans to present updated 2026 return on tangible equity guidance at the full-year results in February [12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, highlighting strong performance in wealth management and the potential for continued growth [11][25] - The company is preparing for significant trends such as the digitization of money and the incorporation of AI into business models [26][27] Other Important Information - The company achieved $566 million in run-rate savings from the Fit for Growth program, with total expense guidance for 2026 remaining below $12.3 billion [5][50] - Credit impairment for the quarter was $195 million, with an annualized loan loss rate of 24 basis points [5][6] Q&A Session Summary Question: Discussion on wealth business margin pickup - Management noted that net new money is migrating into wealth products, and the return on assets has improved due to a conversion from assets under custody to assets under management [15][20] Question: Long-term outlook for wealth management in China - Management discussed the importance of AI and digitization in future growth, emphasizing the bank's strong position in China [25][26] Question: Clarification on net interest income expectations - Management indicated optimism for Q4 net interest income, citing better-than-expected performance and effective management of pass-through rates [34][39] Question: Insights on credit impairment and high-risk assets - Management reassured that there are no significant signs of stress in sovereign credit, despite some fluctuations in high-risk assets [56][60] Question: Future profitability in ventures - Management expects digital banks to turn profitable by 2026, with ongoing improvements in operating performance [75][78]
STANCHART(02888) - 2025 Q3 - Earnings Call Transcript