Standard Chartered PLC Q1 2020 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Martin Leitgeb - Goldman Sachs Group Inc., Research Division - Analyst : I was just wondering, and I appreciate this is difficult, if you just could give us a view on how you're thinking about the credit cycle from here. How severe a cycle could there be for Asia and to what extent is this incorporated in your numbers? And might -- I mean to the extent possible, is it possible to draw some form of GDP comparison, let's say, a minus 2 GDP or whatever the number it would be incorporated? And in that regard, what impact, from your perspective, do the various government schemes make? I mean there's a number of schemes, whether that's some potential form of helicopter monies to loan guarantees and so forth. To what extent do you think those government schemes can eventually soften the cycle? And just on capital, the 13% to 14% target range was something Standard Chartered followed very closely and be in the middle of that range. Should we think about that range going forward being unchanged? Or is there scope for that range to come down on the back of some buffer requirement having been reduced recently?

Question: Thomas Andrew John Rayner - Numis Securities Limited, Research Division - Analyst : Two questions, please, one on Slide 12, one on Slide 10. Just on Slide 12, I know, Andy, you've made some comments already. But I just wondered where you can on those individual drivers which took you from end '19 to end Q1, just wondered if you could sort of comment on how you think they might play out as we move through the year. You've split asset growth from drawdowns. And I think in your release, you said that drawdowns are now pretty much 0 or may even be starting to reverse. I'm just wondering if that's an assumption and we should just focus on the asset growth from sort of the underlying business. The derivatives, not quite sure how to interpret that. But I mean, if volatility returns to normal, does that reverse out or does that just stay stable? What's in the credit migration? I wasn't expecting a huge amount of credit risk pro-cyclicality, for instance, in Q1, but comes in more in the rest of the year. So I'm just wondering what exactly is in that $2 billion figure. And then the market risk, is that purely seasonal? Will that also reverse out as we move forward or could that become a bigger source of pressure? So that's Slide 12. And I have another question on Slide 10. I don't know if you want to do that one first.

Question: Thomas Andrew John Rayner - Numis Securities Limited, Research Division - Analyst : All right. I don't blame you on that one. Okay. On Slide 10, you've given us very good disclosures on the nominal sort of exposure in these risk areas. I'm not sure -- and I might have missed it tucked away somewhere, but whether we have the same granular detail on the outstanding provisions like split into Stage 1, 2 and 3. I mean all I was able to find at the full year really was in Pillar III was the energy sector where that sort of detail is given, but then it's very hard to link back what exactly is in there. And it certainly doesn't seem to match up with some of this. So is there somewhere we can find not just the sort of exposure but how and what the provisions are against that as of today and how that's split between the different stages, so we can maybe do our own sort of modeling on what we think happens moving forward?

Question: Jennifer Alexandra Cook - Exane BNP Paribas, Research Division - Analyst : Can I just ask you a quick clarification? Thanks for that guidance around RWA inflation largely being offset by Permata. Do you think you got that -- I'm sorry to kind of be picking here, but do you think you've got that on top of the Q4 RWA base or the Q1 RWA base? That's just a quick clarification.

Question: Jennifer Alexandra Cook - Exane BNP Paribas, Research Division - Analyst : On the Q1 one. Okay. So around 6% RWA inflation. So okay. Secondly, can I ask on the -- well, could I ask you to narrow down the cost guidance a little bit? How big are the levers that you can pull on in respect to travel, investment spend, variable pay, accrual, et cetera? And what benchmark should we be thinking about here? Because, I mean, it sounds, I think, a little bit too optimistic to be thinking about this as a one-for-one offset to rates.

Question: Jennifer Alexandra Cook - Exane BNP Paribas, Research Division - Analyst : Okay. And in the Russia results this morning, I'll be honest, I couldn't see any reference to you still expecting to deliver positive jaws for this year. Is that still the expectation?