March, 04, 2010

Peter Sands, chief executive of Standard Chartered, on Wednesday stepped up his attack on proposed regulatory reform for the global banking industry, dismissing several key ideas for change.He said he supported regulatory change that would make banks hold more high-quality capital and improve their liquidity, but felt other aspects of proposed reform were “bad ideas”.Any “variants of Glass-Steagal” – separating investment and retail banking operations – seem “hugely distracting, costly and unlikely to make anyone or anything safer”, he added.

He highlighted a risk of “ending up with too safe a banking system relative to its ability to support growth”.Further, he did not believe banks should have to pre-fund compensation schemes and said contingent capital – debt that can turn into equity in times of stress – was too complex.StanChart reported a 13 per cent rise in pre-tax profit and 9 per cent growth in revenue.Its performance was driven by strong growth in India, which contributed more than $1bn of operating profit for the first time – only slightly less than the core Hong Kong business – and an improving trend for losses on bad loans.

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