Standard chartered bank
Country attractiveness study of
A report on
Leading the way in Asia Africa and Middle East
Submitted to: Dr.Rajesh khajuria Dr.Madhu mehta Submitted by: Ghata Ankleshwaria (28)
c.k.Shah vijapurwala institute of management
COMPANY PROFILE A BRIEF HISTORY OF STANDARD CHARTERED BANK The Standard Chartered Group is an unusual banking business. Although its roots are clearly british its area of operations, its network and indeed its profits stream are overwhelmingly international. The name Standard Chartered comes from the two original banks from which it was founded -
The Chartered Bank of India, Australia and China, and The Standard Bank
of British South Africa. The Chartered Bank was founded by James Wilson following the grant of a Royal Charter by Queen Victoria in 1853, while The Standard Bank was founded in the Cape Province of South Africa in 1862 by John Paterson. Both Companies were keen to capitalize on the huge expansion of trade and earn the handsome profits to be made from financing the movement of goods from Europe to Africa. In those early years, both banks prospered Chartered opens its first branch in Bombay,Calcutta and Shanghai in 1858, followed by Hong Kong and Singapore in 1859. With the opening of sub Canal in 1869 and the extension of telegraph to China in 1871, Chartered was well placed to expand and develop its business. Traditional business was in cotton from Bombay, indigo and tea from Calcutta, rice in Burma,sugar from Java, tobacco from Sumatra, hemp in Manila and silk from Yokohama. In South Africa, Standard, having established a considerable number of branches, was prominent in financing the development of the diamond fields of Kimberley from 1867 and later extended its network further north to the new town of
Johannesburg when gold was discovered there in 1885. The output of second largest gold field in the world passes through The Standard Bank on its way to London. Both Banks at that time still quiet separate companies - survived the First World War and the Depression, but were directly affected by the wider conflict of the Second World War in terms of business and closure of branches. There were also longer term effects for both banks as countries in Asia and Africa gained their independence in the 50’s and 60’s. Each had acquired along the way and spread their networks further. In 1969 the decision was made by Chartered and by Standard to undergo a friendly merger. They decided to counterbalance their network with expansion in Europe and United States. Further expansion took place in Standard Charterer’s traditional markets in Asia and Africa. All appeared to be going well, when a hostile takeover bid was made for the group by Lloyds Bank of United Kingdom in 1986. When the bid was defeated, Standard Chartered entered a period of change. Like many British ban provisions had to be made against third World debt exposure and against loan to Corporations & entrepreneurs who could not meet their commitments. Standard Chartered began a series of divestments notably in the United States & South Africa, & also entered into a number of asset sales. In mid 1993, Sir Patrick Gillam became Chairman. He made it clear that Standard Chartered would grow & develop its strong franchises in Asia, Middle East & Africa using its operations in the United Kingdom and North America to provide customer with a bridge between these markets. Secondly , it would focus on consumer , corporate and institutional banking , & on the provision of treasury services – area in which the Group had particular strength and expertise.
In August 2000 , the US $ 1.34 billion acquisition of Grindlays Bank was completed. This made Standard Chartered the leading international bank in India & the other countries of South Asia, strengthened the Group’s competitive position in the Middle East and brought to the Group a respected private banking business. In September 2000 the Group agreed to acquire Chase’s Hong Kong consumer banking business for US $ 1.32 billion, which makes Standard Chartered the leader in Hong Kong cards. At that time it was also announced that Chartered Trust had been sold to Lloyds TSB for £627 millions.
Our Operation Standard Chartered operates in every Asia Pacific market with the exception of North Korea & some 60% of the Group’s profits comes from the Asia Pacific region. Hong Kong continues to be of major importance to the Group & contributes over 30% of total profit. With around 80 branches in Hong Kong & strong representation in China , standard Chartered – a note issuing bank in Hing Kong - is well placed to continue playing an important part in Greater China’s development . The Group’s business there is managed by a resident Group Executive Director. Consumer Banking , Corporate & Institutional Banking are managed out of Singapore each by Group Executive Director resident in the island state. Other East Asian countries of note for the Group are Malasiya , Thailand where , in 1999 , the bank acquired a 75% interest & management control of Bank Nakornthon & Taiwan.
Standard Chartered is the leading international bank in Sub-Saharan Africa , operating in several countries, the most prominent being Kenya ,Zambia ,
Zimbabwe, Botswana & Ghana. The Group operations in the Gulf & South Asia are managed from Dubai. Consumer Banking - which has some 5 million customers – has grown significantly in recent years & contributes about 50% of total profits. Major initiatives support the rapid development of the credit card business in the exciting markets of India , Indonesia & Taiwan.
Corporate & Institutional Banking its principal strengths are in supporting regional & international cross – border trade & investment. Products & services are focused primarily on these areas, notably trade banking , cash management & custody. Institutional Banking manages the Group’s relationship with the banks , investment companies & other financial institutions. It aims to be the ‘Banker’s Bank’ operating in the customer’s time zones & providing network linkage between International Markets. This business has continued to expand rapidly in Asia, Middle East, Africa & increasingly in Latin America. It was strengthened in March 1999 by the acquisition of the trade finance operation of UBS.
Treasury operations are a particular Group strength with a network of over 20 dealing rooms worldwide , offering customer a 24 hour service. The bank is particularly well known for its expertise in exotic currencies & has reinforced its position as a leader in many Asian & African markets.
World wide presence
Bank’s vision To be leader of the Indian market by capitalizing and utilizing all the experience, workforce and opportunity. To be the world’s best and biggest international bank.
Services offered by the standard chartered bank:
Consumer banking
Private banking
Priority banking
SME banking
Wholesale banking
Saadiq Islamic bank
Criteria as per WEF report: Macroeconomic nexus
illegal economy nexus
water-food energy nexus
Asset price collapse
corruption
extreme energy price volatility
Fiscal crises
organized crime
water security
Global imbalances and
fragile states
food security
currency volatility
illicit trade
climate change
A product offers under main banking services:
PERSONAL BANKING ACCOUNTS & DEPOSITS
CREDIT & DEBIT CARDS
Credit Cards
Savings Accounts
Saving Account Supersave Account High Yield Account Easy Saver Account Bonus Saver Account Flex Account Mahana Izaafa
Current Accounts
Basic Banking Account Rupee Current Account Xtra Mile Account Foreign Currency Accounts Business Account Sahulat Online Account Corporate Salary Account Rupee Term Deposits Interest Rates Mahana Amdani Certificates
Master Cashback Credit Cards Saadiq VISA Credit Cards MasterCard VISA Card Easy Credit Card American Express Credit Cards American Express Charge Card PIA Co-branded Credit Card
Debit Cards
VISA Shopping Card Plus Treasures Catalogue
PRIORITY BANKING
The Right Partner Product Proposition Visa Platinum Debit Card
Other Financial Services Banking Convenience Rewards and Privileges Priority Center Locations
LOANS & MORTGAGES
Home Purchase Home Credit
Ready Cash Swift Finance
Secure Life Plan Mustaqbil Taleem Rishtey
Mutual Funds Basics
Mutual Funds Offered
INSURANCE For Branch Banking Customers
Smart Wallet Cover for Life Credit Cover Plus
INVESTMENTS
Loans
For Credit Card Customers
Mortgages
Tahaffuz Invest 'n' Assure Iqra Education Plan Family Care Cash Cover Plus
JS ABAMCO Limited National Investments Trust Limited Atlas Asset Management Limited Arif Habib Investments Management Limited BMA Asset Management Limited KASB Asset Management Limited
Overdrafts Lockers
ISLAMIC BANKING
WHOLESALE BANKING
SME BANKING Business Accounts
Accounts & Deposits
Financial Markets
Tijarat Classic Account
Tijarat Plus Account
Trade and Working Capital
Corporate Finance
Business Power
Principal Finance
Cash Today
Saadiq Home Financing
Loans
Credit & Debit Cards
Transaction banking
Loans and Mortgages
Saadiq Current Account Saadiq Sahulat Online Account Saadiq Saver Saadiq Term Account
Saadiq VISA Credit Cards Saadiq VISA Shopping Card
Business Installment Loan
Industry Specific Solutions
Kissan Card
Rang Hi Rang
Tana Bana
Pharma Line
Agri Deal
Modaraba
Modaraba
Description of the two services of the standard chartered bank  Saadiq Islamic banking: Leading the way in Islamic Banking: With over 1.5 billion Muslims in the world, the global Islamic funds market is currently valued at USD750 billion and is expected to grow exponentially every year. As a major international bank with a heritage of more than 150 years and a global network that covers 50% of the Muslim world, Standard Chartered is ideally placed to play a prominent role in this ever-expanding market
Personal banking in saadiq: At Standard Chartered Saadiq, bank offer a range of personal banking products and services that comply with Shariah principles.
Wholesale banking saadiq:
At Standard Chartered Saadiq, we've blended Shariah principles with our rich banking heritage of more than 150 years to provide banking services that support your business while respecting your beliefs.
Countries where Islamic banking present: Standard chartered bank have been providing Islamic Banking products and services in Malaysia since 1993 and in the UAE, Pakistan and Bangladesh since 2003. Our Islamic Banking business continues to grow rapidly and our customers welcome the solutions we structure based on Shariah principles.
o Bahrain o Malaysia o Bangladesh o Pakistan o UAE
Potential countries for Islamic banking: Standard chartered need to have their Islamic banking in the India because Islam is the second-most practiced religion in the Republic of India after Hinduism, with more than 13.4% of the country's population i.e over 138 million Muslim people. The another potential country is Indonesia because there is 98% of the population is the muslim population.
Priority banking: Standard chartered bank recognize customers’ need to maximize their financial growth and security without compromising on those things, which are important to customers; Family, Business and one’s own personal growth.thats why bank would introduce Standard Chartered Priority Banking . With Priority Banking customer’ll enjoy the freedom to concentrate on their priorities, secure in the knowledge that one have a team of experts devoted to customers’ financial well-being. What’s more, customers and those closest to them will benefit from a range of exclusive Priority Banking services and privileges.
Plan, Grow and Protect your wealth Priority Banking aims to bring customer the experience and expertise, which is vital for managing their wealth. Bank’s unique Plan, Grow and Protect methodology gives customer the choice of managing their wealth efficiently and effectively.
Plan Bank’s Relationship Managers, together with product specialists, design customized solutions and financial plans as per their choice, taking into consideration that their financial needs and goals. Bank identify the gaps between current situations and future goals and aid client in taking decisions to narrow or perhaps even secure these gaps.
Grow At every stage in peoples’ life, Priority Banking provides a comprehensive suite of products to help customers build their funds and assets. Bank offer customer personal and business
banking solutions to choose from, together with a wide range of innovative products to cater to their investment, credit and insurance needs.
Protect Through periodic reviews and timely updates, bank help you decide and make adjustments to banking solutions and investment portfolios to make them profitable in light of the new developments. These regular reviews help customers to plan for the future, while protecting the value of what customer have built over time.
We make everything you value our priority�
Five cornerstones of Service Priority Banking revolves around the five cornerstones of service:
Professional All our CRMs are individuals with professional degrees, who have undergone specialized training within and outside the Bank. The Standard Chartered Wealth Management program certifies our CRMs to conduct financial planning sessions and offer investment advice. The CRMs work with committed, professionally certified and trained Investment Relationship Managers (IRMs), whilst assisting you in making appropriate investment decisions taking into consideration your risk profile and financial goals. In addition to the CRMs, you also have access to the expertise of product specialist in the areas of insurance, securities-backed lending and home loans to assist you in structuring solutions to your needs. This would help meet both long-term financial goals and immediate cash flow requirements.
Profitable With Priority Banking you have access to a wide product range designed to meet your unique needs at every stage in life. A variety of products are offered for both personal and business banking as well as investment management.
Private We have elegantly designed Priority Banking Centers across the country because we understand your need for total privacy and confidentiality. These centers enable you to meet your CRM to discuss and carry out your banking transactions in total privacy and comfort. You can use the services of exclusive teller counters at our Priority Centers and in most of our branches in Pakistan to ensure nominal time is spent on transactions.
Privileged With Priority Banking you enjoy the experience of being a truly privileged customer. We invite you to indulge yourself in a world of privilege and class. As our Priority Banking customer, you can also enjoy participation in a series of unique customized lifestyle events, where we cater to your preference in music, dining and entertainment while giving you the opportunity to meet and interact with other members of our Priority Banking program. Regular seminars are conducted on financial and investment related subjects, where you are given a platform for interacting with eminent personality from across the world.
Seamless international banking beyond borders. Customer’s global connectivity is as important as their global access to funds. Whether client are travelling overseas, settling in a new country or investing overseas, bank are able to provide comprehensive solutions and services to meet their financial needs, onshore and offshore.
Global Recognition For customer and their Family When customer qualify as a Priority Banking customer in any one country, their status will extend worldwide. This will allow them to enjoy the same privileges for their accounts in other countries. What’s more, their family will also enjoy the same recognition, whether they are living with customer at home or overseas.
Designated International Banking Centers Worldwide Simply present your Priority Banking cards at over 200 designated centres across Asia, Africa and the Middle East to enjoy: Use of exclusive Priority Banking Centre lounge and meeting rooms Local and offshore banking information upon request
Pre-Arrival Account Opening
Preferential foreign currency exchange rates
As bank’s Priority Banking customer, client needs are always anticipated. For example, if customer is relocating to another country, he can enjoy the convenience of bank’s Pre-Arrival Account Opening service. Simply give the details ahead of time and, subject to local regulations, client’s new accounts will be opened and ready when he arrive. Global Link – One Click Access to client’s Worldwide Accounts Bank’s Global Link online banking feature instantly allows client to have a consolidated view of all his Standard Chartered Bank accounts as well as transfer funds in different currencies, even if his accounts are in different countries.
Free International Fund Transfers Enjoy complimentary international fund transfers at bank branches and online when transferring money internationally between client’s own Standard Chartered Bank accounts.
Free Worldwide ATM/Debit Card Network Client’s Standard Chartered Bank ATM/Debit Card is his passport to financial convenience as he can access his accounts and make cash withdrawals free of charge at Standard Chartered and Visa/Plus/Cirrus ATMs worldwide. Emergency Cash Services Unexpected accidents like losing wallet can be inconvenient, but not if people are a Priority Banking customer. That’s because with a simple call to their home phone banking centre, bank can arrange for emergency cash to be delivered to bank’s designated Priority Banking centres and Travelex outlets in over 500 locations across Asia, US, Australia, New Zealand, Europe and Middle East. Foreign Exchange Discounts At Travelex Worldwide Present client’s Priority Banking cards and he will receive special discounts on foreign exchange at Travelex outlets in over 700 locations across 20 countries. International Financial Solutions – Local and Offshore Customers are always bank’s priority. Whether client is at home, investing overseas or even relocating to other countries. Bank is there for him, providing comprehensive solutions to serve his international financial needs, both onshore and
offshore. Best of all, a local Relationship Manager will always be on hand to assist client, from enquiries on overseas account openings to expert advice on local markets. It’s banks’ commitment to client, for his peace of mind wherever he goes.
Countries where priority banking is present: As I said earlier that the priority banking facility is available at over 200 designated centers across Asia, Africa and the Middle East.so, the available countries are 1. Pakistan 2. UAE
Potential countries for priority banking services: the priority sector is very much expanded service in standard chartered network but this particular facility should not be available at the home region that is Europe. So the potential countries for the priority banking is 1. irlend jersey 2. turkey Attractiveness and risk to potential countries:
Attractiveness
Strong foreign relation.
Known as tourism place.
Risk:
Highly political
SWOT ANALYSIS: Strengths: •
The Standard Chartered Brand Name.
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Support of its parent company and promoter’s viz. Standard Chartered Bank.
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Competitive rates.
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Good & diverse product.
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Network of branches.
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Highly qualified research team.
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Strong network throughout India, strong presence in WEST, NORTH and SOUTH.
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Dedicated sales team.
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Value added services.
Weakness: •
RM doesn’t give much importance on small companies.
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Account access problem of customers.
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High Average Quarterly Balance.
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Service delivery perception is weak.
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Poor ATM Network.
Opportunity: •
Need to focus on:-
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The growing interest of people in the Derivative and foreign exchange market.
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Recovery of Indian stock market.
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Can offer a complete corporate package into under proposed corporate relationship.
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Tie ups with master card networks.
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Improve shareholders return.
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Increase focus on value creation in whole banking.
Threat: •
Competition from major players like ICICI BANK, KOTAK MAHINDER BANK,HDFC ,SBI BANK ,HSBC ,AXIS BANK etc.
The downfall in the Export market due to global recession.
Standard Chartered Bank Milestones •
We’re the only international bank with over 90 per cent profits from Asia, Africa, and the Middle-East.
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We’re the only international bank with a long unbroken banking history in India and China.
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We’re the largest international bank in India in terms of branch network and profits.
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We’re the only bank in the Falkland Islands.
We’re one of three note issuing banks in Hong Kong
FUTURE OUTLOOK A growing and dynamic banking sector is essential for economic growth in india, as growth in the banking sector and the real economy mutually reinforce each other. The banking sector constitutes the core of the financial sector india. Private sector investment and consumption should be seen as the key drivers of the economy and must be supported by growing financial intermediation and services, including not
only banks but also non-bank financial institutions, and debt securities and the stock market. The growth in banking system has been driven by rise in deposits to Rs4.1 trillion and advances to Rs3.3 trillion. Banks as profitable ventures have attracted close to over $4 billion of foreign direct investment during 2006-2008. Almost half the assets of banks are now owned by foreign banks that are introducing innovation and technological improvements. Recapitalization and prudent lending supported by strong regulatory and supervisory framework have lowered net non-performing loans to historical lows. In line with international trends, SBP introduced Basel II and banks have higher capital adequacy levels --well above the minimum level for the sector as a whole. Despite economic shock and stress in stock market, the banking system in the first quarter of the fiscal year 2009 has shown an increase in profitability of the banking system. Central bank’s policies, regulations and supervision systems have been substantially transformed and barring one area (i.e. noncompliance with consolidated supervision principles progress on which is also underway) Improved management brought high profitability, record low non-performing loans (NPLs) and capital adequacy levels well above regulatory requirements. Despite successful expansion in recent years, the banking sector continues to have a large potential for further growth, diversification and financial strengthening. Deposit base rose to Rs 4.1 trillion and gross advances to Rs 3.3 trillion by September 2008. Supported by the growing financial intermediation process, banks’ aggregate profitability rose from Rs 63.3 billion in 2005 to Rs 73.3 billion by 2007 and Rs 46.0 billion for half year 2008. Recapitalization and prudent lending has lowered banks’ net non-performing loans (NPLs) to around 2.0 percent. Banks’ capitalization and quality of assets have helped raise the risk weighted capital adequacy ratio to 12.1 percent, well above the regulatory minimum of 8.0 percent.
Agriculture lending has received a significant boost with the banking system meeting its target of Rs 200 billion set for 2007/2008. This notwithstanding, outstanding agriculture advances account for only 6% of total advances and the current flow of credit meets only 45% of the sector’s credit requirements. SBP’s strategy for agriculture credit seeks to double the number of borrowers from 2 million to 4 million and to meet 75-80% of the agriculture credit requirements within 3 to 5 years. Authority has encouraged a revolving three-year credit scheme under which farmers can borrow for one year and continue to borrow without providing documentation each year. Guidelines have been issued for lending to the livestock, fisheries and horticulture subsectors and programs are being launched for the dairy sector. In addition, a Small farmer special financing scheme has been promoted based on group based lending and a Crop loan insurance scheme has been structured which is now being offered by some insurance companies. Agriculture credit based on Islamic principles will be promoted and capacity building provided to farmers and bankers in regional languages.