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Breakingviews: StanChart's debts a worry

Wednesday, August 01, 2012 - 03:38

Aug. 1 - Standard Chartered's customary strong growth in the first half may be coming at the expense of ever-higher bad debts, says Reuters Breakingviews' Peter Thal Larsen.

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Topics Reuters breaking news this morning -- -- taking share from rivals and Asia and a great surprise that on for a change hot money working in Asia's favor. With -- is -- Tom Lawson. I'm computer -- can cause can at least for the time being continually -- had a umpire right. You know and and then looking -- meaningless and this is that aiming for that tenth year of some of them in a kind of fairly healthy growth actually. 9% income growth so it actually written it but the sounds pretty good which is really -- reflection of the of the economies that veteran. But as a couple of the society factors working sort of an opposite direction. The first is these state -- quite a big jump in bad debt provisions particular on the consumer side. Which is causing people a bit of Juarez is a sense maybe that actually some of us. This rapid expansion that's been going on lending. He's he's coming back to haunt them in terms of the higher bad debts so that's a bit of a wiry. Yeah but on the policy side. As you said that picking up chef from from the European rivals here with -- information you see that very much in that. -- wholesale business. Particulars of the trade finance is the strategy now. Watch just fighting for -- and -- I think that's part of -- -- think they face that they face a longer term question which is. What is the ideal balance between us and wholesale business and the retail business and ultimately the -- opens this is dominating its its teeth as of the incumbent. Three quarters of the prophet of the bank competitive in the first half. But -- car. You can't. You don't movement necessarily want it spent too much because of us can -- worried about you know kind of criticism where when and how how reliable that's insane. Says that some kind of balancing will probably be needed at some point. I'm hard money like teenagers favor this -- when Arnold's -- just just just talk us through the premise of this. Yeah well if I mean the whole hot money is generally sort of you know that's who worked in particular nation because people. Payroll and -- 98. Governments were skeptical about sort of you know hopefully flying in and then. And in France again and -- And there was a lot of attention and concern. At the time it's a win win the western world embarked on -- to be -- Because suddenly people borrowing in dollars and some and reviewers and them and it wiped out Texas QB right. Why date it on the money for executed but it also it kind of mad that you some mean if you're in NH he would dealing with. Which currency appreciation potentially inflation commodity price inflation all those kind of problems. But actually what's happened now is that as the world slows down some of these Asian countries sort of to trying to think more about how they can stimulate their economies. And actually having some -- money coming in. At the moment is that -- quite hopeful because any hopes corporates and -- corporate deplorable -- -- corporate formations. It's going up everywhere but it's it's really going through the retention. And also it's pushing down. The yields on on on sovereign Lawrence in the Philippines that the Philippines and Philippine government debt has gone from five point 8% to five point 5% in official quarter. -- period of time so for once. And and the reason for that just because people are getting a yield rather than not getting in and I'm going in the US -- Europe so for once actually the whole money. Is working in the favor of the -- the nation's economy. Okay you confront them both as he's on the breaking news web sites. You can now watch this show on the inside a platform of course I don't dot com -- what's -- US breaking news showed twelve birdies in seventeen petty BST. I'm axle problems is horses.

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Breakingviews: StanChart's debts a worry

Wednesday, August 01, 2012 - 03:38