Standard Chartered PLC — Earnings Release 2004

Jun 23, 2004

Standard Chartered PLC

The Stock Exchange of Hong Kong Limited takes no responsibility for the contents of this announcement, makes no representation as to its accuracy or completeness and expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

Standard Chartered

Standard Chartered PLC

(渣打集團有限公司)

(Registered in England and Wales number 966425)

(Stock Code: 2888)

Pre-close Trading Update

Standard Chartered PLC announces details of information to be covered in discussions with analysts ahead of its close period for the half year ending 30 June 2004

Standard Chartered PLC will be holding discussions with analysts ahead of its close period for the half year ending 30 June 2004. This statement details the information that will be covered in those discussions.

Overall

Standard Chartered has continued to make strong progress in the first few months of 2004. This strong underlying performance has been complemented by the gains from the sale of Bank of China and Koram Bank shares, offset in part by the exceptional costs associated with the incorporation of our Hong Kong business and the buyback of a sub-debt portfolio.

Based on our performance to date (excluding the above exceptional items) we are very comfortable in meeting the current profit before tax market consensus for the year.

The organic revenue momentum we have seen so far this year has surpassed our expectations, particularly in Wholesale Banking. This growth is broad based and we have continued to gain market share in both our Consumer and Wholesale businesses.

The bad debt performance to date has been very strong, a direct result of a significantly strengthened risk management discipline within the bank as well as a benign credit environment.

Given favourable economic conditions and strong operating performance, we have maintained the pace of investment in our businesses to capture growth opportunities. Costs for the first few months have grown broadly in line with our revenue.

The incorporation of our Hong Kong business is on target. We fully anticipate the transfer of our Hong Kong businesses to our new subsidiary beginning July 1, positioning us to take further advantage of the growing opportunities between China and Hong Kong.

Overall, we are making very good progress in improving our ROE (return on equity).

Revenue

Consumer Banking

Consumer Banking continues to deliver good revenue growth. Most countries have seen revenue growth at high single digit or low double digit levels. Markets like Indonesia, Malaysia, Thailand, and UAE are performing particularly well. Our expansion plans in India are on track.

Hong Kong, our largest market, has continued to show positive progress. Whilst we have not seen any market growth in consumer assets, we have seen strong demand for wealth management services.

Wholesale Banking

Despite subdued asset demand and strong liquidity in Asia, Wholesale Banking is achieving good revenue growth.

Major growth contributors are trade finance and global markets products. We are seeing strong increases in customer-driven business, particularly in more sophisticated products such as structured trade, derivatives and corporate advisory. The decline we have seen in previous halves in ALM (asset and liability management) revenues has stabilised with the gradual steepening of the yield curve.

Overall, Wholesale Banking is making good progress in improving returns.

Costs

Costs remain a key focus as we work to improve the overall cost income ratio. We are making good progress in centralising, standardising and reengineering our back office activities, with savings achieved broadly offsetting the rise in costs from increased business volumes.

We have continued to invest in our businesses. For Consumer Banking, these investments include product innovation, expansion in distribution networks and entry into new markets including South Korea and South Africa. For Wholesale Banking, the investments reflect the expansion in our product capabilities, such as derivatives and debt capital markets.

Despite the benign market conditions, we have increased our emphasis on risk management and other control functions. This is in addition to the investments we have made on projects including KYC (Know Your Customer), IAS (International Accounting Standards) and Basle II in the context of an increasingly demanding regulatory environment.

We will continue to manage our cost base in a disciplined manner, driving cost efficiencies at the BAU (Business As Usual) level and balancing the trade off between delivery today and investing for growth tomorrow.

Bad Debts

Consumer Banking

Consumer Banking bad debts are performing according to our predictive models, growing in line with the business.

In Hong Kong, we have seen a marked improvement in bankruptcy related bad debts as a result of the early actions we took. Bankruptcy petitions to date have been significantly lower than last year.

Standard Chartered PLC

24-6-2004

---

Standard Chartered PLC

Wholesale Banking

The Wholesale Banking book continues to perform very well. The actions we took to improve the risk profile of the portfolio in 2002 and 2003 are paying off. The general strength of balance sheet of Asian corporates remains strong. We have seen no other major changes in the shape of our portfolio.

Bryan Sanderson, Chairman, commented, "The bank is in very good shape. We see strong prospects in our markets and we are strategically well-placed to take advantage of this growth."

Mervyn Davies, Group Chief Executive, commented, "We are very pleased with the continued strong progress in our financial performance. We are delivering against our management agenda and will sustain investments in our strategic growth opportunities."

As at the date of this announcement, the board comprises:

Executive Directors – Mr. Bryan Kaye Sanderson, CBE; Mr. Evan Mervyn Davies, CBE; Mr. Michael Bernard DeNoma; Mr. Christopher Avedis Keljik; Mr. Richard Henry Meddings; Mr. Kaikhushru Shiavax Nargolwala; Mr. Peter Alexander Sands; and

Independent Non-Executive Directors – Sir CK Chow; Mr. James Frederick Trevor Dundas, Mr. Ho KwonPing; Mr. Rudolph Harold Peter Markham; Ms. Ruth Markland; Mr. Hugh Edward Norton; Mr. Paul David Skinner; Mr. Oliver Henry James Stocken.

By Order of the Board

David J. Brimacombe

Company Secretary

Hong Kong, 23 June 2004

This document contains forward-looking statements, including such statements within the meaning of Section 27A of the US Securities Act of 1993 and section 21E of the Securities Exchange Act of 1934. These statements concern or may affect future matters. These may include Standard Chartered's future strategies, business plans, and results and are based on the current expectations of the directors of Standard Chartered. They are subject to a number of risks and uncertainties that might cause actual results and outcomes to differ materially from expectations outlined in these forward-looking statements. These factors are not limited to regulatory developments but include stock markets, IT, developments, competitive and general operating conditions.

Please also refer to the published version of this announcement in South China Morning Post dated 24 June 2004.

Standard Chartered PLC

24-6-2004