National Storage Mechanism

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RNS Number : 1458V
Standard Chartered PLC
05 August 2015

Standard Chartered PLC

Condensed consolidated interim income statement

For the six months ended 30 June 2015

		6 months ended 30.06.15	6 months ended 30.06.14	6 months ended 31.12.14
	Notes	$million	$million	$million
Interest income		7,687	8,603	8,381
Interest expense		(2,695)	(2,999)	(2,982)
Net interest income		4,992	5,604	5,399
Fees and commission income		2,213	2,284	2,367
Fees and commission expense		(255)	(223)	(249)
Net trading income	3	969	954	942
Other operating income	4	850	635	621
Non-interest income		3,777	3,650	3,681
Operating income		8,769	9,254	9,080
Staff costs	5	(3,320)	(3,454)	(3,334)
Premises costs	5	(402)	(441)	(469)
General administrative expenses	5	(985)	(875)	(1,833)
Depreciation and amortisation	6	(335)	(313)	(326)
Operating expenses		(5,042)	(5,083)	(5,962)
Operating profit before impairment losses and taxation		3,727	4,171	3,118
Impairment losses on loans and advances and other credit risk provisions	7	(1,652)	(846)	(1,295)
Other impairment
Goodwill	8	-	-	(758)
Other	8	(86)	(185)	(218)
Profit from associates and joint ventures		109	113	135
Profit before taxation		2,098	3,253	982
Taxation	9	(567)	(849)	(681)
Profit for the period		1,531	2,404	301
Profit attributable to:
Non-controlling interests	19	19	44	48
Parent company shareholders		1,512	2,360	253
Profit for the period		1,531	2,404	301

Earnings per share:
Basic earnings per ordinary share	11	58.6	94.6	8.2
Diluted earnings per ordinary share	11	58.3	94.0	8.1

Dividends per ordinary share:
Interim dividend declared	10			14.4
Interim dividend paid	10			28.8
Final dividend paid	10			57.2

Total dividend:
Total interim dividend payable¹		366
Total interim dividend (paid 20 October 2014)			710
Total final dividend (paid 14 May 2015)				1,412

¹ Dividend declared/payable represents the interim dividend as declared by the Board of Directors on 5 August 2015 and is expected to be paid on 19 October 2015. This dividend does not represent a liability to the Group at 30 June 2015 and is a non-adjusting event as defined by IAS 10 Events after the reporting period

Standard Chartered PLC

Condensed consolidated interim statement of comprehensive income

For the six months ended 30 June 2015

		6 months ended 30.06.15	6 months ended 30.06.14	6 months ended 31.12.14
	Notes	$million	$million	$million
Profit for the period		1,531	2,404	301
Other comprehensive income:
Items that will not be reclassified to Income statement:
Actuarial gains/(losses) on retirement benefit obligations	18	15	(70)	9
Items that may be reclassified subsequently to Income statement:
Exchange differences on translation of foreign operations:
Net (losses)/gains taken to equity		(604)	358	(1,448)
Net gains/(losses) on net investment hedges	20	(58)	78	-
Share of other comprehensive income from associates and joint ventures		(1)	6	11
Available-for-sale investments:
Net valuation gains taken to equity		140	278	201
Reclassified to income statement		(158)	(249)	(174)
Cash flow hedges:
Net gains/(losses) taken to equity		8	67	(183)
Reclassified to income statement		44	3	10
Taxation relating to components of other comprehensive income		(22)	(30)	8
Other comprehensive income for the period, net of taxation		(558)	305	(1,488)
Total comprehensive income for the period		973	2,709	(1,187)
Total comprehensive income attributable to:
Non-controlling interests		(11)	29	34
Parent company shareholders		984	2,680	(1,221)
		973	2,709	(1,187)

Standard Chartered PLC

Condensed consolidated interim balance sheet

As at 30 June 2015

	Notes	30.06.15	31.12.14
		$million	$million
Assets
Cash and balances at central banks	12	77,274	97,282
Financial assets held at fair value through profit or loss	12	29,809	32,623
Derivative financial instruments	12, 13	60,858	65,834
Loans and advances to banks	12	80,425	83,890
Loans and advances to customers	12	279,188	284,695
Investment securities	12	111,231	104,238
Other assets	12, 14	37,809	38,689
Current tax assets		387	362
Prepayments and accrued income		2,563	2,647
Interests in associates and joint ventures		1,991	1,962
Goodwill and intangible assets	15	5,223	5,190
Property, plant and equipment		7,740	7,984
Deferred tax assets		458	518
Total assets		694,956	725,914

Liabilities
Deposits by banks	12	49,707	54,391
Customer accounts	12	377,479	405,353
Financial liabilities held at fair value through profit or loss	12	25,328	22,390
Derivative financial instruments	12, 13	58,651	63,313
Debt securities in issue	12	71,165	71,951
Other liabilities	12, 16	34,313	31,274
Current tax liabilities		781	891
Accruals and deferred income		5,206	5,915
Subordinated liabilities and other borrowed funds	12, 17	22,197	22,947
Deferred tax liabilities		273	246
Provisions for liabilities and charges		103	92
Retirement benefit obligations	18	409	413
Total liabilities		645,612	679,176

Equity
Share capital	19	1,273	1,236
Share premium		5,450	5,482
Other reserves		9,153	9,690
Retained earnings		31,204	30,024
Total parent company shareholders' equity		47,080	46,432
Other equity instruments	19	1,987	-
Total equity excluding non-controlling interests		49,067	46,432
Non-controlling interests		277	306
Total equity		49,344	46,738
Total equity and liabilities		694,956	725,914

Standard Chartered PLC

Condensed consolidated interim statement of changes in equity

For the six months ended 30 June 2015

	Share capital and share premium account	Other equity instruments	Capital and capital redemption reserve¹	Merger reserve	Available-for-sale reserve	Cash flow hedge reserve	Translation reserve	Retained earnings	Parent company shareholders' equity	Non-controlling interests	Total
	$million	$million	$million	$million	$million	$million	$million	$million	$million	$million	$million
At 1 January 2014	6,707	-	18	12,421	446	15	(2,106)	28,745	46,246	595	46,841
Profit for the period	-	-	-	-	-	-	-	2,360	2,360	44	2,404
Other comprehensive income	-	-	-	-	(5)	59	323	(57)²	320	(15)	305
Distributions	-	-	-	-	-	-	-	-	-	(47)	(47)
Shares issued, net of expenses	9	-	-	-	-	-	-	-	9	-	9
Net own shares adjustment	-	-	-	-	-	-	-	(89)	(89)	-	(89)
Share option expense, net of taxation	-	-	-	-	-	-	-	135	135	-	135
Dividends, net of scrip	-	-	-	-	-	-	-	(718)	(718)	-	(718)
Other increases/ (decreases)³	-	-	-	-	-	-	-	14	14	(292)	(278)
At 30 June 2014	6,716	-	18	12,421	441	74	(1,783)	30,390	48,277	285	48,562
Profit for the period	-	-	-	-	-	-	-	253	253	48	301
Other comprehensive income	-	-	-	-	15	(131)	(1,365)	72	(1,474)	(14)	(1,488)
Distributions	-	-	-	-	-	-	-	-	-	(13)	(13)
Shares issued, net of expenses	2	-	-	-	-	-	-	-	2	-	2
Net own shares adjustment	-	-	-	-	-	-	-	(4)	(4)	-	(4)
Share option expense, net of taxation	-	-	-	-	-	-	-	111	111	-	111
Dividends, net of scrip	-	-	-	-	-	-	-	(733)	(733)	-	(733)
At 31 December 2014	6,718	-	18	12,421	456	(57)	(3,148)	30,024	46,432	306	46,738
Profit for the period	-	-	-	-	-	-	-	1,512	1,512	19	1,531
Other comprehensive income	-	-	-	-	(13)	31	(555)	92	(528)	(30)	(558)
Distributions	-	-	-	-	-	-	-	-	-	(17)	(17)
Shares issued, net of expenses	5	-	-	-	-	-	-	-	5	-	5
Other equity instruments issued, net of expenses	-	1,987	-	-	-	-	-	-	1,987	-	1,987
Net own shares adjustment	-	-	-	-	-	-	-	(30)	(30)	-	(30)
Share option expense, net of taxation	-	-	-	-	-	-	-	157	157	-	157
Dividends, net of scrip	-	-	-	-	-	-	-	(468)	(468)	-	(468)
Other decrease	-	-	-	-	-	-	-	-	-	(1)	(1)
At 30 June 2015	6,723	1,987	18	12,421	443	(26)	(3,703)	31,204	49,067	277	49,344

¹ Includes capital reserve of $5 million and capital redemption reserve of $13 million
² Comprises actuarial gains, net of taxation and non-controlling interests of $9 million (30 June 2014: loss of $57 million and 31 December 2014: gain of $10 million)
³ Relates mainly to redemption of $300 million 7.267% Hybrid Tier 1 securities issued by Standard Chartered Bank Korea Limited

Standard Chartered PLC

Condensed consolidated interim cash flow statement

For the six months ended 30 June 2015

	6 months ended 30.06.15	6 months ended 30.06.14	6 months ended 31.12.14
	$million	$million	$million
Cash flows from operating activities
Profit before taxation	2,098	3,253	982
Adjustments for non-cash items included within income statement	2,116	1,540	2,930
Change in operating assets	9,221	(1,024)	(12,633)
Change in operating liabilities	(31,375)	7,835	51,486
Contributions to defined benefit schemes	(31)	(25)	(73)
UK and overseas taxes paid	(623)	(832)	(876)
Net cash (used in)/from operating activities	(18,594)	10,747	41,816

Cash flows from investing activities
Purchase of property, plant and equipment	(51)	(74)	(115)
Disposal of property, plant and equipment	58	21	46
Investment in associates and joint ventures	-	-	(64)
Disposal of subsidiaries	665	-	-
Purchase of investment securities	(119,785)	(93,521)	(102,533)
Disposal and maturity of investment securities	111,719	96,450	95,605
Dividends received from associates and joint ventures	11	11	2
Net cash (used in)/from investing activities	(7,383)	2,887	(7,059)

Cash flows from financing activities
Issue of ordinary and preference share capital, net of expenses	5	9	2
Issue of Additional Tier 1 capital, net of expenses	1,987	-	-
Purchase of own shares	(39)	(105)	(5)
Exercise of share options through ESOP	9	16	1
Interest paid on subordinated liabilities	(581)	(530)	(560)
Gross proceeds from issue of subordinated liabilities	-	4,056	628
Repayment of subordinated liabilities	-	(285)	(1,829)
Interest paid on senior debts	(265)	(408)	(332)
Gross proceeds from issue of senior debts	4,842	3,394	3,185
Repayment of senior debts	(3,114)	(4,255)	(2,153)
Dividends paid to non-controlling interests and preference shareholders, net of scrip	(67)	(97)	(64)
Dividends paid to ordinary shareholders, net of scrip	(418)	(668)	(682)
Net cash from/(used in) financing activities	2,359	827	(1,809)

Net (decrease)/increase in cash and cash equivalents

1. Accounting Policies

(a) Statement of compliance

The Group condensed consolidated interim financial statements (the interim financial statements) consolidate those of Standard Chartered PLC (the Company) and its subsidiaries (together referred to as the Group) and equity account the Group's interest in associates and jointly controlled entities. These interim financial statements have been prepared in accordance with the Disclosure and Transparency Rules of the Financial Conduct Authority (FCA) and with IAS 34 Interim Financial Reporting as adopted by the European Union (EU). They do not include all of the information required for full annual financial statements, and should be read in conjunction with the consolidated financial statements of the Group as at, and for, the year ended 31 December 2014, which were prepared in accordance with International Financial Reporting Standards (IFRS) and IFRS Interpretations Committee (IFRIC) interpretations as endorsed by the EU. EU endorsed IFRS may differ from IFRS published by the International Accounting Standards Board (IASB) if a standard has not been endorsed by the EU.

The following parts of the Risk and Capital review form part of these interim financial statements and are reviewed:

From the start of 'Principal uncertainties' on page 35 to the end of the 'Liquidity risk' section on page 59, excluding:
- Country cross-border risk on page 52
- Market risk in 2015 - Back testing, page 54
- Liquidity Coverage Ratio (LCR) and Net Stable Funding Ratio (NSFR), page 55
- Encumbered assets, page 56
- Readily available to secure funding, page 56
From the start of 'CRD IV capital base' on page 61 to the end of 'Movement in total capital' on page 62, excluding capital ratios and risk weighted assets (RWA) amounts

(b) Basis of preparation

The interim financial statements have been prepared under the historical cost convention, as modified by the revaluation of cash-settled share-based payments, available-for-sale assets, and financial assets and liabilities (including derivatives) at fair value through profit or loss. These interim financial statements were approved by the Board of Directors on 5 August 2015. The Directors made an assessment of the Group's ability to continue as a going concern and confirm they are satisfied that the Group has adequate resources to continue in business for the foreseeable future. For this reason the Group continues to adopt the going concern basis of accounting for preparing the financial statements. The accounting policies applied by the Group in these interim financial statements are the same as those applied by the Group in the preceding annual consolidated financial statements.

New accounting standards in issue but not yet effective

A number of new standards are effective for periods beginning after 1 January 2016 and have not been applied in preparing these condensed consolidated interim financial statements as these standards have not yet been endorsed by EU. These include:

IFRS 15 Revenue from Contracts with Customers - The effective date of IFRS 15 is 1 January 2018 with early adoption permitted. The standard provides a principles-based approach for revenue recognition and introduces the concept of recognising revenue for obligations as they are satisfied. The standard must be applied retrospectively. Whilst it is expected that a significant proportion of the Group's revenue will be outside the scope of IFRS 15, the impact of the standard is currently being assessed. It is not yet practicable to quantify the effect of IFRS 15 on these interim financial statements. IFRS 15 has yet to be endorsed by the EU.
IFRS 9 Financial Instruments - IFRS 9 was issued in July 2014 and has an effective date of 1 January 2018. IFRS 9 will replace IAS 39 Financial Instruments: Recognition and Measurement and introduces new requirements for the classification and measurement of financial assets and financial liabilities, a new model for recognising loan loss provisions based on expected credit losses and provides for simplified hedge accounting by aligning hedge accounting more closely with an entity's risk management methodology.
Classification and measurement - Financial assets are classified on the basis of the business model within which they are held, and their contractual cash flow characteristics. Financial assets that are held within a hold to collect business model and comprise solely payments of principal and interest (being time value of money) are classified as amortised cost. Debt instruments that comprise solely payments of principal and interest and held within a hold to collect or sell business model are classified at fair value through other comprehensive income (FVOCI). The requirements for the classification and measurement of financial liabilities were carried forward unchanged from IAS 39. However, the requirements relating to their fair value option for financial liabilities were changed to address own credit risk and, in particular, the presentation of gains and losses within other comprehensive income.
Impairment - IFRS 9 incorporates an expected loss approach for recognising credit losses. Under this approach expected credit losses or lifetime expected credit losses for all amortised cost and FVOCI debt instruments are recognised depending on whether or not significant credit deterioration has occurred since origination or acquisition. Where significant deterioration has not occurred, provision equating to 12 months of expected credit losses would be recognised whereas if there is a significant deterioration in credit risk, lifetime expected credit losses would be recognised.

Notes to the financial statements continued

1. Accounting Policies continued

Hedge accounting - The general hedge accounting model aligns hedge accounting more closely with risk management and establish a more principle-based approach to hedge accounting. Dynamic hedging of open portfolios is being dealt with as a separate project and until such time as that accounting requirements of IFRS 9 or to continue to apply the existing hedge accounting requirements in IAS 39. The revised hedge accounting requirements in IFRS 9 are applied prospectively. IFRS 9 has yet to be endorsed by the EU. The impact of the standard is currently being assessed. It is not yet practicable to quantify the effect of IFRS 9 on these consolidated interim financial statements.

Significant judgements

The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates. The significant judgements made by management in applying the Group's accounting policies and key sources of uncertainty were the same as those applied to the consolidated financial statements as at, and for, the year ended 31 December 2014. A summary of the Group's significant accounting policies will be included in the 2015 Annual Report and Accounts.

Notes to the financial statements continued

2. Segmental Information

The Group is organised on a worldwide basis for management and reporting purposes into four client segments: Corporate and Institutional, Commercial, Private Banking and Retail. The strategies adopted by the client segments need to be adapted to local market and regulatory requirements, which is the responsibility of country management teams. While not the primary driver of the business, country performance is an important part of the Group's structure and is also used to evaluate performance and reward staff. Corporate items not allocated are not aggregated into the client segments because of the one-off nature of these items

The Group's entity-wide disclosure which includes profit before tax, net interest margin and structure of the Group's deposits comprises geographic areas, classified by the location of the customer, except for Financial Market products which are classified by the location of the dealer. Transactions between the client segments and geographic areas are carried out on an arm's length basis. Apart from the entities that have been acquired in the last two years, Group central expenses have been distributed between the client segments and geographic areas in proportion to their direct costs and the benefit of the Group's capital has been distributed between segments in proportion to their average credit risk weighted assets. In the year in which an acquisition is made, the Group does not charge or allocate the benefit of the Group's capital. The distribution of central expenses is phased in over two years, based on the estimate of central management costs associated with the acquisition.


Cash and cash equivalents at beginning of the period	(23,618)	14,461
Effect of exchange rate movements on cash and cash equivalents	129,870	84,156
Cash and cash equivalents at end of the period	(771)	224

Performance by Client Segments

6 months ended 30.06.15

	Corporate and Institutional	Commercial	Private Banking	Retail	Total reportable Segments	Corporate items not allocated	Total
$million	$million	$million	$million	$million	$million	$million	$million
Internal income	(27)	2	(6)	31	-	-	-
Net interest income	2,736	298	164	1,794	4,992	-	4,992
Non-interest income¹	2,152	197	146	1,282	3,777	-	3,777
Operating income	4,861	497	304	3,107	8,769	-	8,769
Operating expenses	(2,653)	(324)	(208)	(1,857)	(5,042)	-	(5,042)
Operating profit before impairment losses and taxation	2,208	173	96	1,250	3,727	-	3,727
Impairment losses on loans and advances and other credit risk provisions	(1,040)	(154)	(94)	(364)	(1,652)	-	(1,652)
Other impairment	(81)	(6)	1	-	(86)	-	(86)
Profit from associates and joint ventures	86	10	-	13	109	-	109
Profit before taxation	1,173	23	3	899	2,098	-	2,098
Total assets employed²	489,855	26,583	25,030	148,413	689,881	5,075	694,956
Of which: Loans to customers³	154,562	13,441	17,211	97,125	282,339	-	282,339
Total liabilities employed	442,926	29,825	30,513	141,294	644,558	1,054	645,612
Of which: Customer accounts	223,814	20,940	26,571	117,470	388,795	-	388,795
Other segment items:
Capital expenditure⁴	736	40	13	60	849	-	849
Depreciation	164	7	1	54	226	-	226
Interests in associates and joint ventures	1,360	273	-	358	1,991	-	1,991
Amortisation of intangible assets	65	6	3	35	109	-	109

¹ Includes an own credit adjustment of $55 million and $219 million relating to net gain on businesses sold
² Excludes intangible asset which is included in the segmental assets
³ The analysis is based on the location of the customers rather than booking location of the loan
⁴ Includes capital expenditure $640 million in respect of operating lease asset

Performance by Client Segments continued

6 months ended 30.06.14

	Corporate and Institutional	Commercial	Private Banking	Retail	Total reportable Segments	Corporate items not allocated	Total
$million	$million	$million	$million	$million	$million	$million	$million
Internal income	(8)	11	(14)	11	-	-	-
Net interest income	2,986	365	187	2,066	5,604	-	5,604
Non-interest income¹	2,341	240	141	928	3,650	-	3,650
Operating income	5,319	616	314	3,005	9,254	-	9,254
Operating expenses	(2,546)	(362)	(227)	(1,948)	(5,083)	-	(5,083)
Operating profit before impairment losses and taxation	2,773	254	87	1,057	4,171	-	4,171
Impairment losses on loans and advances and other credit risk provisions	(266)	(100)	-	(480)	(846)	-	(846)
Other impairment	(169)	-	(16)	-	(185)	-	(185)
Profit from associates and joint ventures	90	11	-	12	113	-	113
Profit before taxation	2,428	165	71	589	3,253	-	3,253
Total assets employed²	470,347	35,692	25,676	152,230	683,945	6,193	690,138
Of which: Loans to customers³	168,348	17,632	18,134	100,947	305,061	-	305,061
Total liabilities employed	414,709	43,261	37,554	144,672	640,196	1,380	641,576
Of which: Customer accounts	211,357	31,431	30,606	117,129	390,523	-	390,523
Other segment items:
Capital expenditure⁴	362	35	12	51	460	-	460
Depreciation	146	5	1	55	207	-	207
Interests in associates and joint ventures⁵	1,195	312	20	405	1,932	-	1,932
Amortisation of intangible assets	73	3	2	28	106	-	106

¹ Includes an own credit adjustment of $(15) million and $5 million relating to net gains on businesses sold
² Excludes intangible asset which is included in the segmental assets
³ The analysis is based on the location of the customers rather than booking location of the loan
⁴ Includes capital expenditure (June 2014: $216 million and December 2014: $1,750 million) in respect of operating lease assets
⁵ Restated to reflect a revised segmental allocation

6 months ended 31.12.14

	Corporate and Institutional	Commercial	Private Banking	Retail	Total reportable segments	Corporate items not allocated	Total
$million	$million	$million	$million	$million	$million	$million	$million
Internal income	14	(9)	8	(13)	-	-	-
Net interest income	2,835	357	159	2,048	5,399	-	5,399
Non-interest income⁶	2,363	218	131	969	3,681	-	3,681
Operating income	5,212	566	298	3,004	9,080	-	9,080
Operating expenses	(2,645)	(377)	(220)	(2,054)	(5,296)	(666)⁷	(5,962)
Operating profit before impairment losses and taxation	2,567	189	78	950	3,784	(666)	3,118
Impairment losses on loans and advances and other credit risk provisions	(725)	(112)	-	(458)	(1,295)	-	(1,295)
Other impairment Goodwill Impairment⁸	-	-	-	-	-	(758)	(758)
Other impairment	(138)	(35)	-	(45)	(218)	-	(218)
Profit from associates and joint ventures	108	11	-	16	135	-	135
Profit before taxation	1,812	53	78	463	2,406	(1,424)	982
Total assets employed²	513,767	29,444	26,181	151,418	720,810	5,104	725,914
Of which: Loans to customers³	157,970	14,651	18,056	97,922	288,599	-	288,599
Total liabilities employed	466,680	32,087	36,370	142,902	678,039	1,137	679,176
Of which: Customer accounts	244,731	22,787	29,621	117,050	414,189	-	414,189
Other segment items:
Capital expenditure⁴	1,902	85	32	47	2,066	-	2,066
Depreciation	159	8	3	57	227	-	227
Interests in associates and joint ventures⁵	1,289	280	19	374	1,962	-	1,962
Amortisation of intangible assets	34	10	4	51	99	-	99

⁶ Includes an own credit adjustment of $115 million and $3 million relating to net gains on businesses sold
⁷ Relates to $366 million for UK bank levy and $300 million for US civil monetary penalty
⁸ Relates to $726 million and $32 million goodwill impairment charge in North East Asia and Greater China respectively

Performance by geographic regions and key countries

Entity-wide information

The Group manages its reportable client segments on a global basis. The Group's operations are based in the eight main geographic regions presented below, information is also provided for key countries the Group operates. The UK is the home country of the Company.

6 months ended 30.06.15

	Greater China	North East Asia	South Asia	ASEAN	MENAP	Africa	Americas	Europe	Total
$million	$million	$million	$million	$million	$million	$million	$million	$million	$million
Internal income	28	(23)	(45)	42	42	37	(1)	(80)	-
Net interest income	1,330	480	654	993	451	495	166	423	4,992
Fees and commissions income, net	682	110	142	410	182	197	173	62	1,958
Net trading income	550	62	(97)	90	141	23	88	112	969
- Underlying	535	61	(97)	74	139	23	88	91	914
- Own credit adjustment	15	1	-	16	2	-	-	21	55
Other operating income	529	69	64	98	23	7	14	46	850
Operating income¹	3,119	698	718	1,633	839	759	440	563	8,769
Operating expenses	(1,474)	(525)	(385)	(973)	(475)	(467)	(392)	(351)	(5,042)
Operating profit before impairment losses and taxation¹	1,645	173	333	660	364	292	48	212	3,727
Impairment losses on loans and advances and other credit risk provisions	(290)	(136)	(485)	(328)	(134)	(148)	(19)	(112)	(1,652)
Other impairment	(1)	(7)	(18)	(1)	-	(3)	-	(56)	(86)
Profit from associates and joint ventures	77	-	-	32	-	-	-	-	109
Profit/(loss) before taxation	1,431	30	(170)	363	230	141	29	44	2,098
Total assets employed²	205,670	65,538	36,596	149,980	42,410	26,669	78,904	162,037	-
Of which: Loans to customers³	86,429	30,135	23,414	74,006	21,658	12,758	12,498	21,441	-
Average interest-earning assets³	176,340	54,406	30,728	119,589	35,233	22,125	73,822	124,744	-
Net interest margin (%)	1.6	1.7	4.0	1.7	2.8	4.9	0.5	0.5	1.7
Capital expenditure⁴	655	6	10	146	3	9	5	15	849

¹ Includes an own credit adjustment of $55 million and $219 million relating to net gain on businesses sold
² Includes intra-group assets
³ Based on the location of the customers rather than booking location
⁴ Includes capital expenditure in Greater China of $640 million in respect of operating lease assets. Other capital expenditure comprises additions to property and equipment and software related intangibles including any post-acquisition additions made by the acquired entities

Entity-wide information continued

6 months ended 30.06.14

	Greater China	North East Asia	South Asia	ASEAN	MENAP	Africa	Americas	Europe	Total
$million	$million	$million	$million	$million	$million	$million	$million	$million	$million
Internal income	9	(38)	17	48	53	43	1	(133)	-
Net interest income	1,506	631	624	1,101	471	484	195	592	5,604
Fees and commissions income, net	646	114	143	489	216	201	168	84	2,061
Net trading income	456	(31)	118	130	158	107	37	(21)	954
- Underlying	423	(31)	118	157	158	107	37	-	969
- Own credit adjustment	33	-	-	(27)	-	-	-	(21)	(15)
Other operating income	201	33	57	125	53	43	13	110	635
Operating income¹	2,818	709	959	1,893	951	878	414	632	9,254
Operating expenses	(1,410)	(616)	(379)	(1,030)	(482)	(467)	(300)	(399)	(5,083)
Operating profit before impairment losses and taxation	1,408	93	580	863	469	411	114	233	4,171
Impairment losses on loans and advances and other credit risk provisions	(212)	(209)	(61)	(215)	(27)	(94)	-	(28)	(846)
Other impairment	(95)	-	-	(3)	-	-	-	(87)	(185)
Profit from associates and joint ventures	84	-	-	29	-	-	-	-	113
Profit/(loss) before taxation¹	1,185	(116)	519	674	442	317	114	118	3,253
Total assets employed²	209,019	68,880	38,617	158,437	43,056	27,788	68,228	146,430	-
Of which: Loans to customers³	95,848	29,626	24,324	86,561	23,941	13,766	11,277	19,718	-
Average interest-earning assets³	173,336	58,554	32,663	125,702	35,524	22,652	63,303	89,870	-
Net interest margin (%)	1.8	2.0	4.0	1.9	3.0	4.7	0.6	1.0	2.1
Capital expenditure ⁴	237	14	16	155	7	17	1	13	460

¹ Includes $(15) million relating to Own credit adjustment and $5 million relating to losses on businesses held for sale
² Includes intra-group assets
³ The analysis is based on the location of the customers rather than booking location of the loan
⁴ Includes capital expenditure of $216 million in respect of operating lease assets. Other capital expenditure comprises additions to property and equipment and software related intangibles including any post-acquisition additions made by the acquired entities# 2. Segmental Information continued

Performance by geographic regions and key countries continued

Entity-wide information 6 months ended 31.12.14

	Greater China	North East Asia	South Asia	ASEAN	MENAP	Africa	Americas	Europe	Total
$million	$million	$million	$million	$million	$million	$million	$million	$million
Internal income	(37)	(42)	(68)	6	29	50	(7)	69	-
Net interest income	1,500	607	643	1,150	480	504	201	314	5,399
Fees and commissions income, net	696	122	155	469	202	212	191	71	2,118
Net trading income	342	43	113	101	86	92	47	118	942
- Underlying	281	43	113	77	86	92	47	88	827
- Own credit adjustment	61	-	-	24	-	-	-	30	115
Other operating income	221	20	53	94	95	93	15	30	621
Operating income¹	2,722	750	896	1,820	892	951	447	602	9,080
Operating expenses²	(1,501)	(563)	(414)	(1,048)	(502)	(523)	(668)	(743)	(5,962)
Operating profit before impairment losses and taxation	1,221	187	482	772	390	428	(221)	(141)	3,118
Impairment losses on loans and advances and other credit risk provisions	(257)	(185)	(122)	(483)	(62)	(81)	(21)	(84)	(1,295)
Other impairment³	(79)	(737)	(73)	(83)	(1)	(1)	(1)	(1)	(976)
Profit from associates and joint ventures	93	-	-	33	-	10	-	(1)	135
Profit/(loss) before taxation	978	(735)	287	239	327	356	(243)	(227)	982
Total assets employed⁴	213,196	64,896	35,941	160,286	44,225	26,456	91,999	172,274	-
Of which: Loans to customers⁵	89,646	29,582	22,859	78,541	22,775	13,103	10,952	21,141	-
Average interest-earning assets⁵	176,277	58,517	30,823	128,493	36,463	22,192	70,802	130,444	-
Net interest margin (%)	1.7	1.9	3.7	1.8	2.8	5.0	0.5	0.6	1.8
Capital expenditure ⁶	1,771	26	12	222	5	21	1	8	2,066

1 Includes an own credit adjustment of $115 million and $3 million relating to net gains on businesses sold
2 Includes $366 million UK bank levy and $300 million civil monetary penalty in Americas
3 Includes $32 million and $726 million relating to goodwill impairment charge in Greater China and North East Asia respectively
4 Includes intra-group assets
5 The analysis is based on the location of the customers rather than booking location of the loan
6 Includes capital expenditure in Greater China of $1,750 million in respect of operating lease assets. Other capital expenditure comprises additions to property and equipment and software related intangibles including any post-acquisition additions made by the acquired entities

2. Segmental Information continued

Performance by geographic regions and key countries continued

Entity-wide information 6 months ended 30.06.15

	Hong Kong	Singapore	Korea	India	UAE	China	UK
$million	$million	$million	$million	$million	$million	$million	$million
Net interest income	855	540	440	476	277	383	302
Fees and commissions income, net	536	243	103	111	115	58	37
Net trading income	382	63	54	(120)	80	94	84
- Underlying	367	44	53	(120)	78	94	63
- Own credit adjustment	15	19	1	-	2	-	21
Other operating income	454	59	63	56	17	68	36
Operating income¹	2,227	905	660	523	489	603	459
Operating expenses	(923)	(518)	(499)	(298)	(286)	(387)	(293)
Operating profit before impairment losses and taxation	1,304	387	161	225	203	216	166
Impairment losses on loans and advances and other credit risk provisions	(196)	(101)	(138)	(483)	(116)	(88)	(112)
Other impairment	(1)	(1)	(7)	(18)	-	-	(56)
Profit from associates and joint ventures	-	-	-	-	-	77	-
Profit/(loss) before taxation	1,107	285	16	(276)	87	205	(2)
Total assets employed²	155,391	114,569	52,142	30,449	27,493	33,923	164,389
Of which: Loans to customers³	60,676	52,117	29,155	20,048	13,371	14,516	18,795
Capital expenditure⁴	651	138	6	8	-	2	14

1 Includes own credit adjustment and net gains on businesses sold
2 Includes intra-group assets
3 The analysis is based on the location of the customers rather than booking location of the loan
4 Includes capital expenditure in Hong Kong of $640 million in respect of operating lease assets. Other capital expenditure comprises additions to property and equipment and software related intangibles including any post-acquisition additions made by the acquired entities

2. Segmental Information continued

Performance profit by geographic regions and key countries continued

Entity-wide information 6 months ended 30.06.14

	Hong Kong	Singapore	Korea	India	UAE	China	UK
$million	$million	$million	$million	$million	$million	$million	$million
Net interest income	948	589	568	520	316	420	394
Fees and commissions income, net	511	299	105	108	138	62	56
Net Trading income	396	61	(35)	86	103	10	(30)
- Underlying	364	81	(36)	86	103	9	(9)
- Own credit adjustment	32	(20)	1	-	-	1	(21)
Other operating income	169	66	32	45	39	24	94
Operating income¹	2,024	1,015	670	759	596	516	514
Operating expenses	(866)	(551)	(587)	(308)	(286)	(371)	(308)
Operating profit before impairment losses and taxation	1,158	464	83	451	310	145	206
Impairment losses on loans and advances and other credit risks provisions	(163)	(28)	(209)	(56)	(21)	(35)	(26)
Other impairment	(95)	(1)	-	-	-	-	(87)
Profit from associates and joint ventures	-	-	-	-	-	84	-
Profit/(loss) before taxation	900	435	(126)	395	289	194	93
Total assets employed²	151,672	117,708	57,397	33,101	27,890	36,819	146,612
Of which: Loans to customers³	66,979	61,481	28,835	21,415	15,256	16,467	16,441
Capital expenditure⁴	230	144	14	14	1	3	10

6 months ended 31.12.14

	Hong Kong	Singapore	Korea	India	UAE	China	UK
$million	$million	$million	$million	$million	$million	$million	$million
Net interest income	958	575	541	446	289	359	337
Fees and commissions income, net	529	283	114	117	125	71	27
Net trading income	306	104	35	87	33	(16)	111
- Underlying income	245	90	35	87	33	(16)	81
- Own credit adjustment	61	14	-	-	-	-	30
Other operating income	228	50	20	43	27	(11)	(5)
Operating income¹	2,021	1,012	710	693	474	403	470
Operating expenses⁵	(926)	(542)	(534)	(339)	(283)	(387)	(634)
Operating profit before impairment losses and taxation	1,095	470	176	354	191	16	(164)
Impairment losses on loans and advances and other credit risk provisions	(109)	(52)	(183)	(115)	(42)	(142)	(82)
Other impairment⁶	(74)	(1)	(737)	(73)	-	-	(1)
Profit from associates and joint ventures	-	(1)	-	-	-	93	-
Profit/(loss) before taxation	912	416	(744)	166	149	(33)	(247)
Total assets employed²	156,528	120,845	54,437	30,083	28,322	36,250	172,259
Of which: Loans to customers³	61,643	55,830	28,600	19,718	14,358	15,939	18,344
Capital expenditure⁷	1,766	211	25	6	1	4	9

1 Includes own credit adjustment and net gains/(losses) on businesses sold/held for sale
2 Includes intra-group assets
3 The analysis is based on the location of the customers rather than booking location of the loan
4 Includes capital expenditure in Hong Kong of $216 million in respect of operating lease assets. Other capital expenditure comprises additions to property and equipment and software related intangibles including any post-acquisition additions made by the acquired entities
5 Includes $366 million in respect of UK bank levy
6 Includes $32 million and $726 million related to goodwill impairment charge in Hong Kong and Korea respectively
7 Includes capital expenditure in Hong Kong of $1,750 million in respect of operating lease assets. Other capital expenditure comprises additions to property and equipment and software related intangibles including any post-acquisition additions made by the acquired entities

2. Segmental Information continued

Deposits structure by geographic regions

The following tables set out the structure of the Group's deposits by principal geographic regions:

30.06.15

	Greater China	North East Asia	South Asia	ASEAN	MENAP	Africa	Americas	Europe	Total
$million	$million	$million	$million	$million	$million	$million	$million	$million	$million
Non-interest bearing current and demand accounts	13,591	620	2,872	10,753	7,303	5,636	2,251	607	43,633
Interest bearing current accounts and savings deposits	87,992	20,854	3,042	39,235	4,287	2,841	18,467	15,419	192,137
Time deposits	44,118	14,446	10,023	41,680	13,077	2,373	19,378	35,180	180,275
Other deposits	3,521	481	500	3,868	346	221	914	13,473	23,324
Total	149,222	36,401	16,437	95,536	25,013	11,071	41,010	64,679	439,369
Deposits by banks	7,862	5,105	358	7,115	1,884	427	17,039	10,784	50,574
Customer accounts	141,360	31,296	16,079	88,421	23,129	10,644	23,971	53,895	388,795
Protected under Government insurance Schemes	26,260	9,096	1,227	11,615	795	2,694	-	65	51,752
Other Accounts	115,100	22,200	14,852	76,806	22,334	7,950	23,971	53,830	337,043
149,222	36,401	16,437	95,536	25,013	11,071	41,010	64,679	439,369
Debt securities in issue:
Senior debt	1,462	3,307	-	-	-	5	-	20,017	24,791
Other debt securities	2,251	5,790	53	5,609	-	67	16,830	24,990	55,590
Subordinated liabilities and other borrowed funds	1,331	332	-	-	25	42	-	20,467	22,197
Total	154,266	45,830	16,490	101,145	25,038	11,185	57,840	130,153	541,947

31.12.14

	Greater China	North East Asia	South Asia	ASEAN	MENAP	Africa	Americas	Europe	Total
$million	$million	$million	$million	$million	$million	$million	$million	$million	$million
Non-interest bearing current and demand accounts	12,670	514	3,201	10,579	7,969	5,826	2,610	2,582	45,951
Interest bearing current accounts and savings deposits	86,110	21,369	2,771	39,067	5,051	2,590	17,345	17,885	192,188
Time deposits	57,735	14,476	8,575	47,583	11,422	3,142	28,231	42,214	213,378
Other deposits	220	462	1,001	3,841	412	146	1,689	10,224	17,995
Total	156,735	36,821	15,548	101,070	24,854	11,704	49,875	72,905	469,512
Deposits by banks	5,200	4,202	338	7,283	2,374	687	16,496	18,743	55,323
Customer accounts	151,535	32,619	15,210	93,787	22,480	11,017	33,379	54,162	414,189
Protected under Government insurance Schemes	26,700	9,309	1,253	12,825	326	2,927	-	69	53,409
Other Accounts	124,835	23,310	13,957	80,962	22,154	8,090	33,379	54,093	360,780
156,735	36,821	15,548	101,070	24,854	11,704	49,875	72,905	469,512
Debt securities in issue:
Senior debt	1,416	3,919	-	-	-	5	-	18,804	24,144
Other debt securities	3,569	6,234	388	5,004	-	137	17,325	23,987	56,644
Subordinated liabilities and other borrowed funds	1,342	337	-	-	25	46	-	21,197	22,947
Total	163,062	47,311	15,936	106,074	24,879	11,892	67,200	136,893	573,247

	6 months ended 30.06.15 $million	6 months ended 30.06.14 $million	6 months ended 31.12.14 $million
Gains less losses on instruments held for trading	948	1,040	940
Foreign currency¹	1,436	58	240
Trading securities	156	146	191
Interest rate derivatives	(470)	871	435
Credit and other derivatives	(174)	(35)	74
Gains less losses from fair value hedging	3	(13)	(16)
Gains less losses from fair value hedged items	475	(280)	(1,021)
Gains less losses from fair value hedged instruments	(472)	267	1,005
Gains less losses on instruments designated at fair value	18	(73)	18
Financial assets designated at fair value through profit or loss	26	(7)	(58)
Financial liabilities designated at fair value through profit or loss	(113)	(382)	(452)
Own credit adjustment (OCA)	55	(15)	115
Derivatives managed with financial instruments designated at fair value through profit or loss	50	331	413
	969	954	942

¹ Includes foreign currency gains and losses arising on the translation of foreign currency monetary assets and liabilities

Gains less losses on instruments held for trading is presented by product type. Gains or losses on certain trading securities are offset by gains or losses within interest rate derivatives and credit and other derivatives.

4. Other operating income

	6 months ended 30.06.15 $million	6 months ended 30.06.14 $million	6 months ended 31.12.14 $million
Other operating income includes:
Gains less losses on disposal of financial instruments:
Available-for-sale	159	249	177
Loans and receivables	(2)	2	6
Dividend income	79	64	33
Rental income from operating lease assets	300	247	315
Gain on disposal of property, plant and equipment	50	19	30
Receipt of tax refund related income	13	-	26
Net gain on sale of businesses	222	-	13
Fair value loss on business classified as held for sale	(3)	(5)	(10)

5. Operating expenses

Staff costs

	6 months ended 30.06.15 $million	6 months ended 30.06.14 $million	6 months ended 31.12.14 $million
Wages and salaries	2,482	2,596	2,439
Social security costs	79	89	79
Other pension costs (note 18)	142	170	163
Share based payment costs	138	143	91
Other staff costs	479	456	562
Total	3,320	3,454	3,334

Variable compensation is included within wages and salaries. Other staff costs primarily include redundancy, staff benefits and training costs.

Premises and equipment expenses

	6 months ended 30.06.15 $million	6 months ended 30.06.14 $million	6 months ended 31.12.14 $million
Rental of premises	215	230	224
Other premises and equipment costs	176	199	233
Rental of computers and equipment	11	12	12
Total	402	441	469

General administrative expenses

	6 months ended 30.06.15 $million	6 months ended 30.06.14 $million	6 months ended 31.12.14 $million
UK bank levy¹	-	-	366
Civil monetary penalty²	-	-	300
Other general administrative expenses	985	875	1,167
Total	985	875	1,833

¹ Under current accounting requirements, the UK bank levy is only recognised in the financial statements on 31 December each year. The UK bank levy is applied on the chargeable equities and liabilities on the Group's consolidated balance sheet. Key exclusions from chargeable equities and liabilities include Tier 1 capital, insured or guaranteed retail deposits, repos secured on certain sovereign debt and liabilities subject to netting. The rate of the levy for 2015 is the blended rate of 0.197 per cent for chargeable short term liabilities, with a lower rate of 0.098 per cent generally applied to chargeable equity and long term liabilities (i.e. liabilities with a remaining maturity greater than one year)

² In August 2014, Standard Chartered reached a settlement with the New York Department of Financial Services (NYDFS) regarding deficiencies in its anti-money laundering transaction surveillance system at the New York branch

6. Depreciation and amortisation

	6 months ended 30.06.15 $million	6 months ended 30.06.14 $million	6 months ended 31.12.14 $million
Premises	50	49	56
Equipment:
Operating lease assets	132	107	127
Others	44	51	44
Intangibles:
Software	97	85	80
Acquired on business combinations	12	21	19
Total	335	313	326

7. Impairment losses on loans and advances and other credit risk provisions

The following table reconciles the charge for impairment provisions on loans and advances to the total impairment charge and other credit risk provision:

	6 months ended 30.06.15 $million	6 months ended 30.06.14 $million	6 months ended 31.12.14 $million
Net charge against profit on loans and advances:
Individual impairment charge	1,687	819	1,277
Portfolio impairment (release)/charge	(49)	28	10
	1,638	847	1,287
Impairment charges/(releases) related to credit commitments	11	(1)	7
Impairment charges relating to debt securities classified as loans and receivables	3	-	1
Total impairment losses and other credit risk provisions on loans and advances	1,652	846	1,295

An analysis of impairment provisions on loans and advances is set out within the Risk and Capital review.

8. Other impairment

	6 months ended 30.06.15 $million	6 months ended 30.06.14 $million	6 months ended 31.12.14 $million
Impairment losses on available-for-sale financial assets:
- Debt securities	18	55	54
- Equity shares	48	4	43
	66	59	97
Impairment of investment in associates	-	16	81
Impairment of goodwill	-	-	758
Impairment of fixed assets	38	-	-
Impairment of acquired intangible assets	1	-	8
Impairment of commodity assets	-	113	26
Other	(5)	-	9
	100	188	979
Recovery of impairment on disposal of instruments¹	(14)	(3)	(3)
Total	86	185	976

¹ Relates to investment securities sold during the period which had impairment provisions raised against them in prior periods

9. Taxation

Analysis of taxation charge in the period:

	6 months ended 30.06.15 $million	6 months ended 30.06.14 $million	6 months ended 31.12.14 $million
The charge for taxation based upon the profits for the period comprises:
Current tax:
United Kingdom corporation tax at 20.25 per cent (30 June 2014 and 31 December 2014: 21.5 per cent):
Current tax on income for the period	4	53	116
Adjustments in respect of prior periods (including double taxation relief)	20	(3)	(127)
Double taxation relief	(4)	(4)	(4)
Foreign tax:
Current tax on income for the period	502	873	587
Adjustments in respect of prior periods	(25)	(5)	(24)
	497	914	548
Deferred tax:
Origination/reversal of temporary differences	71	(50)	35
Adjustments in respect of prior periods	(1)	(15)	98
	70	(65)	133
Tax on profits on ordinary activities	567	849	681
Effective tax rate	27.0%	26.1%	69.3%

The UK corporation tax rate was reduced from 21 per cent to 20 per cent with an effective date of 1 April 2015, giving a blended 20.25 per cent for the year. Foreign taxation includes current taxation on Hong Kong profits of $72 million (30 June 2014: $113 million, 31 December 2014: $94 million) provided at a rate of 16.5 per cent (30 June 2014 and 31 December 2014: 16.5 per cent) on the profits assessable in Hong Kong. Deferred taxation includes origination/reversal of temporary differences in Hong Kong profits of $(3) million (30 June 2014: $(1) million, 31 December 2014: $5 million) provided at a rate of 16.5 per cent (30 June 2014 and 31 December: 16.5 per cent) on the profits assessable to Hong Kong.

10. Dividends

Ordinary equity shares

	30.06.15 Cents per share	30.06.15 $million	30.06.14 Cents per share	30.06.14 $million	31.12.14 Cents per share	31.12.14 $million
2014/2013
Final dividend declared and paid during the period¹	57.20	1,412	57.20	1,385	-	-
2014 Interim dividend declared and paid during the period¹	-	-	-	-	28.80	710
	57.20	1,412	57.20	1,385	28.80	710

¹ The amounts are gross of scrip adjustments

The amounts in the table above reflect the actual dividend per share declared and paid to shareholders in 2015 and 2014. Interim dividends on ordinary equity shares are recorded in the period in which they are declared and, in respect of the final dividend, have been approved by the shareholders. Accordingly, the final ordinary equity share dividends set out above relate to the respective prior years. The 2014 interim dividend of 28.80 cents per ordinary share ($710 million) was paid to eligible shareholders on 20 October 2014 and the final dividend of 57.20 cents per ordinary share ($1,412 million) was paid to eligible shareholders on 14 May 2015.

2015 recommended interim dividend

The 2015 interim dividend of 14.40 cents per share ($366 million) will be paid in either pounds sterling, Hong Kong dollars or US dollars on 19 October 2015 to shareholders on the UK register of members at the close of business in the UK (10:00 pm London time) on 14 August 2015, and to shareholders on the Hong Kong branch register of members at the opening of business in Hong Kong (9:00 am Hong Kong time) on 14 August 2015. The 2015 interim dividend will be paid in Indian rupees on 19 October 2015 to Indian Depository Receipt holders on the Indian register at the close of business in India on 14 August 2015. It is intended that shareholders on the UK register and Hong Kong branch register will be able to elect to receive shares credited as fully paid instead of all or part of the final cash dividend. Details of the dividend arrangements will be sent to shareholders on or around 4 September 2015. Indian Depository Receipt holders will receive their dividend in Indian rupees only.

Preference shares

	30.06.15 $million	30.06.14 $million	31.12.14 $million
Non-cumulative irredeemable preference shares:
7 3/8 per cent preference shares of £1 each¹	6	6	7
8 1/4 per cent preference shares of £1 each¹	6	6	6
Non-cumulative redeemable preference shares:
7.014 per cent preference shares of $5 each²	26	26	27
6.409 per cent preference shares of $5 each²	24	24	24

¹ Dividends on these preference shares are treated as interest expense and accrued accordingly
² Dividends on these preference shares classified as equity are recorded in the period in which they are declared# Earnings per ordinary share

6 months ended 30.06.15

	Profit¹	Weighted average number of shares	Per share amount
	$million	('000)	cents
Basic earnings per ordinary share	1,462	2,496,639	58.6
Effect of dilutive potential ordinary shares: Options²		9,089	16,259
Diluted earnings per ordinary share	1,462	2,505,728	58.3

6 months ended 30.06.14

	Profit¹	Weighted average number of shares	Per share amount
	$million	('000)	cents
Basic earnings per ordinary share	2,310	2,441,899	94.6
Effect of dilutive potential ordinary shares: Options²		16,259
Diluted earnings per ordinary share	2,310	2,458,158	94.0

6 months ended 31.12.14

	Profit¹	Weighted average number of shares	Per share amount
	$million	('000)	cents
Basic earnings per ordinary share	202	2,474,488	8.2
Effect of dilutive potential ordinary shares: Options²		14,591
Diluted earnings per ordinary share	202	2,489,079	8.1

¹ Profit amounts represent the profit attributable to ordinary shareholders, which is profit for the year after non-controlling interest and the declaration of dividends payable to the holders of the non-cumulative redeemable preference shares classified as equity (see note 10).
² The impact of anti-dilutive options has been excluded from this amount as required by IAS 33 Earnings per share. There were no ordinary shares issued after the balance sheet date that would have significantly affected the number of ordinary shares used in the above calculation had they been issued prior to the end of the balance sheet date.

11. Earnings per ordinary share continued

The Group measures earnings per share on a normalised basis. This differs from earnings defined in IAS 33 Earnings per share. The table below provides a reconciliation.

	6 months ended 30.06.15	6 months ended 30.06.14	6 months ended 31.12.14
	$million	$million	$million
Operating income as reported	8,769	9,254	9,080
Items normalised:
Fair value movements on own credit adjustment	(55)	15	(115)
Gain on disposal of property	-	(19)	(30)
Net gain arising on sale of business	(222)	-	(13)
Fair value loss on business classified as held for sale	3	5	10
	(274)	1	(148)
Normalised operating income	8,495	9,255	8,932
Operating expenses as reported	(5,042)	(5,083)	(5,962)
Items normalised:
Amortisation of intangible assets arising on business combinations	12	21	19
Civil monetary penalty¹	-	-	300
	12	21	319
Normalised operating expenses	(5,030)	(5,062)	(5,643)
Other impairment as reported	(86)	(185)	(976)
Items normalised:
Impairment of associates	-	16	81
Impairment of acquired intangibles	-	-	8
Impairment of goodwill	-	-	758
	-	16	847
Normalised other impairment	(86)	(169)	(129)
Taxation as reported	(567)	(849)	(681)
Tax on normalised items	2	15	11
Normalised taxation	(552)	(840)	(670)
Profit as reported	3	1,462	2,310
202
Items normalised as above:
Operating income	(274)	1	(148)
Operating expenses	12	21	319
Other impairment	-	16	847
Taxation	15	9	11
	(247)	47	1,029
Normalised profit	1,215	2,357	1,231
Normalised basic earnings per ordinary share (cents)	48.7	96.5	49.7
Normalised diluted earnings per ordinary share (cents)	48.5	95.9	49.5

¹ In August 2014, Standard Chartered reached a settlement with the New York Department of Financial Services (DFS) regarding deficiencies in its anti-money laundering transaction surveillance system at the New York branch. There is no tax relief for this settlement.
² No tax is included in respect of the impairment of goodwill as no tax relief is available.
³ The profit amounts represent the profit attributable to ordinary shareholders, which is profit for the year after non-controlling interest and the declaration of dividends payable to the holders of the non-cumulative redeemable preference shares classified as equity (see note 10).

12. Financial instruments

Classification

The Group's classification of its financial assets and liabilities is summarised in the following tables.

Assets at fair value	Assets at amortised cost	Assets	Total
Assets Trading	Derivatives held for hedging	Designated at fair value through profit or loss	Available- for-sale
Notes	$million	$million	$million
---	---	---	---
Cash and balances at central banks	-	-	-
Financial assets held at fair value through profit or loss
Loans and advances to banks¹	2,315	-	442
Loans and advances to customers¹	2,103	-	1,048
Treasury bills and other eligible bills	2,109	-	90
Debt securities	15,006	-	403
Equity shares	5,407	-	886
	26,940	-	2,869
Derivative financial instruments¹³	59,558	1,300	-
Loans and advances to banks¹	-	-	-
Loans and advances to customers¹	-	-	-
Investment securities
Treasury bills and other eligible bills	-	-	-
Debt securities	-	-	-
Equity shares	-	-	-
	-	-	-
Other assets¹⁴	-	-	-
Total at 30 June 2015	86,498	1,300	2,869

Assets at fair value	Assets at amortised cost	Assets	Total
Assets Trading	Derivatives held for hedging	Designated at fair value through profit or loss	Available- for-sale
Notes	$million	$million	$million
---	---	---	---
Cash and balances at central banks	-	-	-
Financial assets held at fair value through profit or loss
Loans and advances to banks¹	3,368	-	242
Loans and advances to customers¹	2,833	-	1,071
Treasury bills and other eligible bills	1,720	-	92
Debt securities	17,735	-	-
Equity shares	4,556	-	1,006
	30,212	-	2,411
Derivative financial instruments¹³	64,111	1,723	-
Loans and advances to banks¹	-	-	-
Loans and advances to customers¹	-	-	-
Investment securities
Treasury bills and other eligible bills	-	-	-
Debt securities	-	-	-
Equity shares	-	-	-
	-	-	-
Other assets¹⁴	-	-	-
Total at 31 December 2014	94,323	1,723	2,411

¹ Further analysed in Risk and Capital review.

Liabilities at fair value	Liabilities	Total
Liabilities Trading	Derivatives held for hedging	Designated at fair value through profit or loss
Notes	$million	$million
---	---	---
Financial liabilities held at fair value through profit or loss
Deposits by banks	-	-
Customer accounts	-	-
Debt securities in issue	-	-
Short positions	3,929	-
	3,929	-
Derivative financial instruments¹³	56,354	2,297
Deposits by banks	-	-
Customer accounts	-	-
Debt securities in issue	-	-
Other liabilities¹⁶	-	-
Subordinated liabilities and other borrowed funds¹⁷	-	-
Total at 30 June 2015	60,283	2,297

Liabilities at fair value	Liabilities	Total
Liabilities Trading	Derivatives held for hedging	Designated at fair value through profit or loss
Notes	$million	$million
---	---	---
Financial liabilities held at fair value through profit or loss
Deposits by banks	-	-
Customer accounts	-	-
Debt securities in issue	-	-
Short positions	3,785	-
	3,785	-
Derivative financial instruments¹³	61,896	1,417
Deposits by banks	-	-
Customer accounts	-	-
Debt securities in issue	-	-
Other liabilities¹⁶	-	-
Subordinated liabilities and other borrowed funds¹⁷	-	-
Total at 31 December 2014	65,681	1,417

12. Financial instruments continued

There is no significant change to what was disclosed in the Group's 2014 Annual Report in respect of valuation methodology and Levelling approaches. The following tables show the classification of financial instruments held at fair value into the valuation hierarchy as at 30 June 2015 and 31 December 2014.

Level 1	Level 2	Level 3	Total
Assets	$million	$million	$million
Financial instruments held at fair value through profit or loss
Loans and advances to banks	-	2,757	-
Loans and advances to customers	-	2,771	380
Treasury bills and other eligible bills	1,847	348	4
Debt securities	8,208	6,216	985
Of which: Government bonds	7,548	1,361	98
Issued by corporates other than financial institutions	133	2,608	433
Issued by financial institutions	527	2,247	454
Equity shares	5,366	3	924
Derivative financial instruments	620	59,676	562
Of which: Foreign exchange	97	43,209	374
Interest rate	-	13,447	50
Commodity	522	2,445	-
Credit	-	265	32
Equity and stock index	1	310	106
Investment securities
Treasury bills and other eligible bills	23,086	4,379	126
Debt securities	32,959	45,227	410
Of which: Government bonds	17,223	7,749	101
Issued by corporates other than financial institutions	11,241	9,512	304
Issued by financial institutions	4,495	27,966	5
Equity shares	939	8	877
Total at 30 June 2015	73,025	121,385	4,268

Level 1	Level 2	Level 3	Total
Liabilities	$million	$million	$million
Financial instruments held at fair value through profit or loss
Deposits by banks	-	867	-
Customer accounts	-	11,315	1
Debt securities in issue	-	8,706	510
Short positions	3,267	662	-
Derivative financial instruments	704	57,652	295
Of which: Foreign exchange	109	42,407	244
Interest rate	-	13,179	12
Commodity	595	981	-
Credit	-	577	14
Equity and stock index	-	508	25
Total at 30 June 2015	3,971	79,202	806

There are no# 12. Financial instruments

The following table presents the Group's financial assets and liabilities by class and fair value hierarchy.

Valuation hierarchy	Level 1	Level 2	Level 3	Total
Assets	$million	$million	$million	$million
Financial instruments held at fair value through profit or loss
Loans and advances to banks	-	3,610	-	3,610
Loans and advances to customers	-	3,264	640	3,904
Treasury bills and other eligible bills	1,578	234	-	1,812
Debt securities	8,466	8,874	395	17,735
Of which: Government bonds	8,158	1,519	-	9,677
Issued by corporates other than financial institutions	84	2,861	187	3,132
Issued by financial institutions	224	4,494	208	4,926
Equity shares	4,754	-	808	5,562
Derivative financial instruments	759	64,500	575	65,834
Of which: Foreign exchange	40	43,665	379	44,084
Interest rate	-	15,157	47	15,204
Commodity	719	4,983	-	5,702
Credit	-	420	20	440
Equity and stock index	-	275	129	404
Investment securities
Treasury bills and other eligible bills	20,895	3,178	-	24,073
Debt securities	30,696	43,881	360	74,937
Of which: Government bonds	16,321	6,053	66	22,440
Issued by corporates other than financial institutions	9,790	9,713	289	19,792
Issued by financial institutions	4,585	28,115	5	32,705
Equity shares	1,248	6	953	2,207
Total at 31 December 2014	68,396	127,547	3,731	199,674
Liabilities
Financial instruments held at fair value through profit or loss
Deposits by banks	-	932	-	932
Customer accounts	-	8,835	1	8,836
Debt securities in issue	-	8,629	208	8,837
Short positions	3,267	518	-	3,785
Derivative financial instruments	863	62,154	296	63,313
Of which: Foreign exchange	102	44,814	240	45,156
Interest rate	-	13,677	16	13,693
Commodity	761	2,161	-	2,922
Credit	-	955	10	965
Equity and stock index	-	547	30	577
Total at 31 December 2014	4,130	81,068	505	85,703

There are no significant transfers of financial assets and liabilities measured at fair value between Level 1 and Level 2 during the period.

12. Financial instruments continued

Fair value adjustments

When establishing the exit price of a financial instrument using a valuation technique, the Group considers adjustments to the modelled price which market participants would make when pricing that instrument. In total, the Group has made $564 million (2014: $432 million) of valuation adjustments in determining fair value for financial assets and financial liabilities classified as Level 2 and Level 3 financial instruments. The main adjustments are described below:

	30.06.15	31.12.14
Valuation adjustments	$ million	$ million
Bid-offer	68	66
Credit¹	138	160
Model	14	14
Funding Valuation Adjustment	168	111
Others (including Day 1)	176	81
Total	564	432

¹ Includes debit valuation adjustments on derivative/liabilities

Level 3 movement tables - Financial assets

The table below analyses movements in level 3 financial assets carried at fair value.

Held at fair value through profit or loss

Assets	Loans and advances to customers	Treasury Bills	Debt securities	Equity shares	Derivative financial instruments	Investment securities Treasury Bills	Debt securities	Equity shares	Total
	$million	$million	$million	$million	$million	$million	$million	$million	$million
At 1 January 2015	640	-	395	808	575	-	360	953	3,731
Total (losses)/gains recognised in income statement	(287)	-	5	(13)	(94)	-	(20)	4	(405)
Total losses recognised in other comprehensive income	-	-	-	-	-	-	(23)	(8)	(31)
Purchases	333	-	349	298	86	-	-	56	1,122
Sales	(337)	-	(2)	(222)	(63)	-	9	(135)	(750)
Settlements	-	-	-	-	(44)	-	(30)	-	(74)
Transfers out¹	-	-	-	-	(11)	(1)	(49)	-	(61)
Transfers in²	31	4	238	53	113	127	163	7	736
At 30 June 2015	380	4	985	924	562	126	410	877	4,268
Total (losses)/gains recognised in the income statement relating to assets held at 30 June 2015	(287)	-	6	(14)	(95)	-	(18)	1	(407)

¹ Transfers out during the period primarily relate to certain equity loans and advances and corporate debt securities where the valuation parameters became observable during the period and were transferred to Level 1 and Level 2 financial assets
² Transfers in during the period primarily relate to investment in structured notes, corporate debt securities and loans and advances where the valuation parameters become unobservable during the period

Held at fair value through profit or loss

Assets	Loans and advances to customers	Debt securities	Equity shares	Derivative financial instruments Treasury Bills	Debt securities	Equity shares	Total
	$million	$million	$million	$million	$million	$million	$million
At 1 January 2014	720	159	904	598	19	608	1,456
Total (losses)/gains recognised in income statement	(44)	3	22	19	-	(37)	126
Total gains/ (losses) recognised in other comprehensive income	-	-	-	-	-	2	(89)
Purchases	11	27	34	6	-	38	5
Sales	-	(4)	(65)	(1)	-	(26)	(558)
Settlements	(27)	(4)	-	(87)	(11)	(13)	-
Transfers out¹	(15)	-	(149)	(3)	-	(71)	-
Transfers in²	205	5	-	2	-	160	4
At 30 June 2014	850	186	702	534	8	661	944
Total (losses)/gains recognised in the income statement relating to assets held at 30 June 2014	(33)	-	(6)	19	-	-	-

Held at fair value through profit or loss

Assets	Loans and advances to customers	Debt securities	Equity shares	Derivative financial instruments Treasury bills	Debt securities	Equity shares	Total
	$million	$million	$million	$million	$million	$million	$million
At 1 July 2014	850	186	702	534	8	661	944
Total (losses)/gains recognised in income statement	(137)	4	(85)	(31)	-	27	65
Total losses recognised in other comprehensive income	-	-	-	-	-	(68)	(55)
Purchases	181	246	410	86	-	(21)	309
Sales	(231)	(34)	(176)	(5)	-	(57)	(322)
Settlements	(34)	(15)	-	(20)	11	(21)	-
Transfers out¹	9	(3)	(43)	-	(19)	(56)	-
Transfers in²	2	11	-	11	-	(105)	12
At 31 December 2014	640	395	808	575	-	360	953
Total (losses)/gains recognised in the income statement relating to assets held at 31 December 2014	(154)	5	54	29	-	(37)	(16)

Level 3 movement tables - Financial liabilities

Liabilities	Customer accounts	Debt securities in issue	Derivative financial instruments	Total	Customer accounts	Debt securities in issue	Derivative financial instruments	Total
	30.06.15	30.06.15	30.06.15	30.06.15	30.06.14	30.06.14	30.06.14	30.06.14
	$million	$million	$million	$million	$million	$million	$million	$million
At 1 January	1	208	296	505	8	39	441	488
Total losses/(gains) recognised in income statement	-	6	8	14	-	1	(13)	(12)
Issues	-	220	11	231	-	21	4	25
Settlements	-	(65)	(19)	(84)	(5)	(16)	(72)	(93)
Transfers out¹	-	-	(4)	(4)	-	-	-	-
Transfers in²	-	141	3	144	-	31	-	31
At 30 June	1	510	295	806	3	76	360	439
Total losses recognised in the income statement relating to liabilities held at end of the period	-	-	7	7	-	-	15	15

Liabilities	Customer accounts	Debt securities in issue	Derivative financial instruments	Total
	31.12.14	31.12.14	31.12.14	31.12.14
	$million	$million	$million	$million
At 1 July 2014	3	76	360	439
Total losses/(gains) recognised in income statement	-	2	(5)	(3)
Issues	-	138	23	161
Settlements	(2)	(8)	(80)	(90)
Transfers in²	-	-	(2)	(2)
At 31 December 2014	1	208	296	505
Total losses recognised in the income statement relating to liabilities held at 31 December 2014	-	-	29	29

¹ Transfers out during the period primarily relate to certain financial instruments where the valuation parameters became observable during the period and were transferred to Level 2 financial liabilities
² Transfers in during the period primarily relate to certain financial instruments for which parameters became unobservable during the period

The following table present the Group's primary level 3 financial instruments which are held at the fair value. The table also presents the valuation techniques used to measure the fair value of those financial instruments, the significant unobservable inputs, the range of values for those inputs and the weighted average of those inputs:

Value at 30 June 2015	Instrument	Assets $million	Liabilities $million	Principal valuation technique	Significant unobservable inputs	Range¹	Weighted average²
	Loans and advances to customers	380	-	Comparable pricing/Yield	Price/Yield	11.7% to 17.3%	15.1%
					Recovery rates	19.3% to 75.0%	26.5%
	Debt securities²	1,018	-	Comparable pricing/Yield	Price/Yield	0.9% to 30.0%	10.2%
	Asset backed securities	178	-	Discounted cash flows	Price/Yield	12% to 4.5%	3.1%
				Discounted cash flows	Discount Margin	15.1%	15.1%
	Debt securities in issue	-	510	Internal pricing model	Equity correlation	-35.0% to 97.0%	N/A
				Discounted cash flows	Credit Spreads	0.6 to 4.0%	1.9%
	Government bonds	329	-	Discounted cash flows	Price/Yield	1.6% to 31.9%	4.2%
				Comparable pricing/Yield	Price/Yield	91.1 to 104.0	101.3
	Derivative financial instruments
	of which: Foreign exchange	374	244	Option pricing model	Foreign exchange option implied volatility	1.4% to 33.4%	6.7%
	Interest rate	50	12	Discounted cash flows	Interest rate curves	0.3% to 14.9%	4.2%
				Spread option model	Interest rate correlation	97.9% to 98.9%	98.1%
	Credit	32	14	Discounted cash flows	Credit spreads	0.2% to 0.5%	2.4%
	Equity	106	25	Internal pricing model	Equity correlation	-35.0% to 97.0%	N/A
	Equity shares	1,801	-	Comparable pricing/Yield	EV/EBITDA multiples	7.8x to 19.0x	11.8x
					(includes private equity P/E multiples investments)	18.2x	18.2x
					Liquidity discount	10.0% to 20.0%	13.6%
Total	4,268	806

¹ The ranges of values shown in the above table represent# 12. Financial instruments continued

The following section describes the significant unobservable inputs identified in the valuation technique table.

Credit Spreads

Credit Spreads represent the additional yield that a market participant would demand for taking exposure to the credit risk of an instrument.

Recovery rates

Recovery Rate is the expectation of the rate of return resulting from the liquidation of a particular loan. As the probability of default increases for a given instrument, the valuation of that instrument will increasingly reflect its expected recovery level assuming default. An increase in the recovery rate, in isolation, would result in a favourable movement in the fair value of the loan.

Comparable Price/Yield

Comparable pricing is a valuation methodology in which a price of a comparable instrument is used to estimate the fair value where there are no direct observable prices. Yield is the interest rate that is used to discount the future cash-flows in a discounted cash-flow model. Valuation using comparable instruments can be done by calculating an implied yield (or spread over a liquid benchmark) from the price of a comparable instrument, then adjusting that yield (or spread) to derive a value for the instrument. The adjustment should account for relevant differences in the financial instruments such as maturity and/or credit quality. Alternatively, a price-to-price basis can be assumed between the comparable instrument and the instrument being valued in order to establish the value of the instrument (e.g., deriving a fair value for a junior unsecured bond from the price of a senior secured bond). An increase in price, in isolation, would result in a favourable movement in the fair value of the asset. An increase in yield, in isolation, would result in an unfavourable movement in the fair value of the asset.

Discount margin

Discount margin is the required return over a floating index to compensate the risk associated with the asset. An increase in discount margin, in isolation, would result in an unfavourable movement in the fair value of the asset.

Correlation

Correlation is the measure of how movement in one variable influences the movement in another variable. An equity correlation is the correlation between two equity instruments while an interest rate correlation refers to the correlation between two swap rates.

Volatility

Volatility represents an estimate of how much a particular instrument, parameter or index will change in value over time. Generally, the higher the volatility, the more expensive the option will be.

Interest rate curves

Interest rate curve is the term structure of interest rates and measure of future interest rates at a particular point of time.

EV/EBITDA ratio multiples

This is the ratio of Enterprise Value (EV) to Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA). EV is the aggregate market capitalisation and debt minus the cash and cash equivalents. An increase in EV/EBITDA multiple in isolation, will result in a favourable movement in the fair value of the unlisted firm.

P/E multiples

Price Earnings multiple is the ratio of the Market Capitalisation to the Net Income after tax. The multiples are determined from multiples of listed comparables, which are observable. An increase in P/E multiple will result in a favourable movement in the fair value of the unlisted firm.

Liquidity discounts in the valuation of unlisted investments

A liquidity discount is primarily applied to the valuation of unlisted firms' investments to reflect the fact that these stocks are not actively traded. An increase in liquidity discount will result in unfavourable movement in the fair value of the unlisted firm.

Sensitivities in respect of the fair values of level 3 assets and liabilities

Sensitivity analysis is performed on financial instruments with significant unobservable inputs to generate a range of reasonably possible alternative valuations. The percentage shift is determined by statistical analysis performed on a set of reference prices, which included certain equity indices, credit indices and volatility indices, based on the composition of our Level 3 assets. Favourable and unfavourable changes are determined on the basis of changes in the value of the instrument as a result of varying the levels of the unobservable parameters. This Level 3 sensitivity analysis assumes a one way market move and does not consider offsets for hedges.

	Held at fair value through profit or loss	Available-for-sale
	Favourable Changes	Unfavourable Changes	Favourable Changes	Unfavourable Changes	Net exposure
$million	$million	$million	$million	$million	$million
Financial instruments held at fair value
Debt securities	985	1,000	970	410	438
Equity shares	924	1,016	832	877	965
Loan and advances	380	543	348	-	-
Treasury bills	4	4	4	126	127
Derivative financial instruments	267	392	141	-	-
Debt securities in issue	(510)	(500)	(520)	-	-
At 30 June 2015	2,050	2,455	1,775	1,413	1,530

Financial instruments held at fair value
Debt securities	395	404	385	360	386
Equity shares	808	889	727	953	1,048
Loan and advances	639	661	620	-	-
Treasury bills	-	-	-	-	-
Derivative financial instruments	279	334	222	-	-
Debt securities in issue	(208)	(202)	(214)	-	-
At 31 December 2014	1,913	2,086	1,740	1,313	1,434

The reasonably possible alternatives could have increased or decreased the fair values of financial instruments held at fair value through profit or loss and those classified as available-for-sale by the amounts disclosed below

	30.06.15 $million	31.12.14 $million
Financial instruments
Fair value changes
Designated at fair value through profit or loss
Possible increase	405	173
Possible decrease	(275)	(173)
Available-for-sale
Possible increase	117	121
Possible decrease	(117)	(118)

12. Financial instruments continued

Valuation of financial instruments measured at amortised cost on a recurring basis

The table shows the carrying amounts and the Group's estimate of fair values of those financial assets and liabilities not presented on the Group's balance sheet at fair value. These fair values reported may be different from the actual amount that will be received/paid on the settlement or maturity of the financial instrument. Details of the basis used by the Group to establish fair values of amortised cost financial instruments and their valuation hierarchy can be found in the 2014 Annual Report.

	Carrying value $million	Level 1 $million	Level 2 $million	Level 3 $million	Total $million
Assets
Cash and balances at central banks¹	77,274	-	77,274	-	77,274
Loans and advances to banks	80,425	-	80,570	171	80,741
Loans and advances to customers	279,188	-	5,214	273,204	278,418
Investment securities	3,220	-	3,173	92	3,265
Other assets¹	34,728	-	34,728	-	34,728
At 30 June 2015	474,835	-	200,959	273,467	474,426

Liabilities
Deposits by banks	49,707	-	49,705	-	49,705
Customer accounts	377,479	-	375,173	-	375,173
Debt securities in issue	71,165	20,017	51,103	-	71,120
Subordinated liabilities and other borrowed funds	22,197	21,628	456	-	22,084
Other liabilities¹	33,472	-	33,472	-	33,472
At 30 June 2015	554,020	41,645	509,909	-	551,554

	Carrying value $million	Level 1 $million	Level 2 $million	Level 3 $million	Total $million
Assets
Cash and balances at central banks¹	97,282	-	97,282	-	97,282
Loans and advances to banks	83,890	-	83,843	180	84,023
Loans and advances to customers	284,695	-	5,450	278,398	283,848
Investment securities	3,021	-	3,031	28	3,059
Other assets¹	30,754	-	30,753	-	30,753
At 31 December 2014	499,642	-	220,359	278,606	498,965

Liabilities
Deposits by banks	54,391	-	54,427	-	54,427
Customer accounts	405,353	-	405,879	-	405,879
Debt securities in issue	71,951	19,119	52,682	-	71,801
Subordinated liabilities and other borrowed funds	22,947	20,549	1,880	-	22,429
Other liabilities¹	30,086	-	30,086	-	30,086
At 31 December 2014	584,728	39,668	544,954	-	584,622

¹ The carrying amount of these financial instruments is considered to be a reasonable approximation of fair value as they are short term in nature or reprice to current market rates frequently

13. Derivative financial instruments

The tables below analyse the notional principal amounts and the positive and negative fair values of the Group's derivative financial instruments. Notional principal amounts are the amount of principal underlying the contract at the reporting date.# 30.06.15 31.12.14 Derivatives Notional principal amounts Assets Liabilities Notional principal amounts Assets Liabilities
$million $million $million $million $million $million

Foreign exchange derivative contracts:

	Notional principal amounts	Assets	Liabilities	Notional principal amounts	Assets	Liabilities
Forward foreign exchange contracts	1,873,468	17,274	15,933	1,611,476	19,265	20,649
Currency swaps and options	1,486,030	26,406	26,827	1,589,989	24,819	24,507
Exchange traded futures and options	302	-	-	300	-	-
Total	3,359,800	43,680	42,760	3,201,765	44,084	45,156

Interest rate derivative contracts:

	Notional principal amounts	Assets	Liabilities	Notional principal amounts	Assets	Liabilities
Swaps	2,278,884	12,674	12,102	2,264,473	14,325	12,874
Forward rate agreements and options	124,031	823	1,089	186,796	879	819
Exchange traded futures and options	1,632,106	-	-	1,313,920	-	-
Total	4,035,021	13,497	13,191	3,765,189	15,204	13,693

Credit derivative contracts

Equity and stock index options

Commodity derivative contracts

Total derivatives

	Notional principal amounts	Assets	Liabilities	Notional principal amounts	Assets	Liabilities
Total	7,572,498	60,858	58,651	7,145,652	65,834	63,313

The Group limits exposure to credit losses in the event of default by entering into master netting agreements with certain market counterparties. As required by IAS 32, exposures are only presented net in these accounts where they are subject to legal right of offset and intended to be settled net in the ordinary course of business.

Derivatives held for hedging
Hedge accounting is applied to derivatives and hedged items when the criteria under IAS 39 have been met. The tables below list the types of derivatives that the Group holds for hedge accounting.

30.06.15 31.12.14 Derivatives designated as fair value hedges:

	Notional principal amounts	Assets	Liabilities	Notional principal amounts	Assets	Liabilities
Interest rate swaps	48,989	511	291	48,427	671	335
Forward foreign exchange contracts	8	-	-	12	1	-
Currency swaps	31,040	669	1,924	30,953	905	892
Total	80,037	1,180	2,215	79,392	1,577	1,227

Derivatives designated as cash flow hedges:

	Notional principal amounts	Assets	Liabilities	Notional principal amounts	Assets	Liabilities
Interest rate swaps	13,284	6	29	9,465	5	17
Forward foreign exchange contracts	1,595	12	46	2,375	4	75
Currency swaps	3,114	68	7	6,524	62	98
Total	17,993	86	82	18,364	71	190

Derivatives designated as net investment hedges:

	Notional principal amounts	Assets	Liabilities	Notional principal amounts	Assets	Liabilities
Forward foreign exchange contracts	1,648	34	-	1,098	75	-

Total derivatives held for hedging

	Notional principal amounts	Assets	Liabilities	Notional principal amounts	Assets	Liabilities
Total	99,678	1,300	2,297	98,854	1,723	1,417

14. Other assets

	30.06.15	31.12.14
$million	$million	$million
Financial assets held at amortised cost (note 12)
Hong Kong SAR Government certificates of indebtedness (note 16)¹	4,785	4,738
Cash collateral	9,264	10,311
Acceptances and endorsements	4,634	5,212
Unsettled trades and other financial assets	16,045	10,493
Subtotal	34,728	30,754
Non-financial assets and assets held for sale
Commodities	2,637	4,432
Assets held for sale	2	207
Other assets	237	266
Subtotal	2,876	4,905
Total	37,604	35,659

1 The Hong Kong SAR Government certificates of indebtedness are subordinated to the claims of other parties in respect of bank notes issued.
2 The disposal groups are measured at fair value less costs to sell and the assets and liabilities held for sale are classified within level 3 of the fair value hierarchy. The disposal groups mainly include businesses held for sale in Pakistan, consisting of Standard Chartered Leasing Co. Limited, Standard Chartered Modarba and Standard Chartered Services (Pvt.) Ltd. The Group has recognised a fair value loss of $3 million (2014: $15 million) within Other operating income (note 4) relating to assets held for sale during 2015. The businesses held for sale in Hong Kong, Korea and Lebanon at 31 December 2014, were completed in 2015.

15. Goodwill and intangible assets

30.06.15

	Goodwill	Acquired intangibles	Software	Total
$million	$million	$million	$million	$million
Cost at 30 June	4,230	522	1,453	6,205
Provision for amortisation	-	(444)	(538)	(982)
Net book value at 30 June	4,230	78	915	5,223

30.06.14

	Goodwill	Acquired intangibles	Software	Total
$million	$million	$million	$million	$million
Cost at 30 June	5,269	685	1,236	7,190
Provision for amortisation	-	(559)	(431)	(990)
Net book value at 30 June	5,269	126	805	6,200

31.12.14

	Goodwill	Acquired intangibles	Software	Total
$million	$million	$million	$million	$million
Cost at 31 December	4,982	564	1,348	6,894
Impairment charge	(758)	-	-	(758)
Net book value	4,224	564	1,348	6,136
Provision for amortisation	-	(467)	(479)	(946)
Net book value at 31 December	4,224	97	869	5,190

Outcome of impairment assessment

At 30 June 2015 the Group has performed a review of the goodwill that has been assigned to the Group's cash generating units for indicators of impairment, considering whether there were any reduced expectations for future cash flows and/or fluctuations in the discount rate or the assumptions. At 30 June 2015, the results of this review indicated that there is no goodwill impairment to be recognised. The Group believes that a reasonable possible change in any of the key assumptions on which the recoverable amounts have been based would not cause the carrying amounts to exceed their recoverable amount. It continues to be possible that certain scenarios could be constructed where a combination of a material change in the discount rate coupled with a reduction in current business plan forecasts or the GDP growth rate, would potentially result in the carrying amount of goodwill exceeding the recoverable amount in the future.

16. Other liabilities

	30.06.15	31.12.14
$million	$million	$million
Financial liabilities held at amortised cost (note 12)
Notes in circulation¹	4,785	4,738
Acceptances and endorsements	4,634	5,212
Cash collateral	7,851	7,005
Unsettled trades and other financial liabilities	16,202	13,131
Subtotal	33,472	30,086
Non-financial liabilities
Cash-settled share based payments	17	37
Liabilities held for sale²	80	710
Other liabilities	744	441
Subtotal	841	1,188
Total	34,313	31,274

1 Hong Kong currency notes in circulation of $4,785 million (31 December 2014: $4,738 million) that are secured by the government of Hong Kong SAR certificates of indebtedness of the same amount included in other assets (note 14).
2 The $80 million is in respect of businesses held for sale in Pakistan; the disposal group consists of Standard Chartered Leasing Co. Limited, Standard Chartered Modarba and Standard Chartered Services (Pvt.) Ltd. The related assets are disclosed in note 14.

17. Subordinated liabilities and other borrowed funds

	30.06.15					31.12.14
$million	USD	GBP	Euro	Others	Total	USD	GBP	Euro	Others	Total
Fixed rate subordinated debt	10,673	5,190	4,181	1,830	21,874	10,836	5,274	4,645	1,870	22,625
Floating rate subordinated debt	238	48	-	37	323	238	47	-	37	322
Total	10,911	5,238	4,181	1,867	22,197	11,074	5,321	4,645	1,907	22,947

All subordinated liabilities are unsecured, unguaranteed and subordinated to the claims of other creditors including without limitation, customer deposits and deposits by banks. The Group has the right to settle these debt instruments in certain circumstances as set out in the contractual agreements. There were no issuances or redemptions during the period.

18. Retirement benefit obligations

Retirement benefit obligations comprise:

	30.06.15	30.06.14	31.12.14
$million	$million	$million	$million
Total market value of assets	2,626	2,671	2,634
Present value of the schemes' liabilities	(3,020)	(3,119)	(3,025)
Defined benefit schemes obligation	(394)	(448)	(391)
Defined contribution schemes obligation	(15)	(24)	(22)
Net obligation	(409)	(472)	(413)

Retirement benefit charge comprises:

	6 months ended 30.06.15	6 months ended 30.06.14	6 months ended 31.12.14
$million	$million	$million	$million
Defined benefit schemes	52	56	49
Defined contribution schemes	90	114	114
Charge against profit (note 5)	142	170	163

The pension cost for defined benefit schemes was:

	6 months ended 30.06.15	6 months ended 30.06.14	6 months ended 31.12.14
$million	$million	$million	$million
Current service cost and admin expenses	46	49	45
Past service cost and curtailments	-	-	(1)
Gain on settlements	(1)	-	(1)
Interest income on pension scheme assets	(43)	(53)	(55)
Interest on pension scheme liabilities	50	60	61
Total charge to profit before tax	52	56	49
Return on plan assets excl. interest	(2)	(22)	(131)
(Gain)/loss on liabilities	(13)	92	122
Total (gain)/loss recognised in SCI	(15)	70	(9)
Deferred taxation	6	(14)	1
Total (gain)/loss after tax	(9)	56	(8)

19. Share capital, reserves and own shares

Group and Company

Number of ordinary shares	Ordinary share capital	Preference share capital	Total
millions	$million	$million	$million
At 1 January 2014	2,427	1,214	-
Capitalised on scrip dividend	36	18	-
Shares issued	7	3	-
At 30 June 2014	2,470	1,235	-
Capitalised on scrip dividend	2	1	-
Shares issued	1	-	-
At 31 December 2014	2,473	1,236	-
Capitalised on scrip dividend	69	35	-
Shares issued	5	2	-
At 30 June 2015	2,547	1,273	-

2015

On 14 May 2015, the Company issued 69,186,004 new ordinary shares instead of the 2014 final dividend. During the period 4,815,731 shares were issued under employee share plans at prices between nil and 1,140 pence.

2014

On 14 May 2014, the Company issued 36,260,040 new ordinary shares instead of the 2013 final dividend and on the 20 October 2014 the Company issued 1,315,836 new ordinary shares instead of the 2014 interim dividend. During the year 7,736,568 shares were issued under employee share plans at prices between nil and 1,463 pence.

Other equity instruments

On 2 April 2015 Standard Chartered PLC issued $2,000 million Fixed Rate Resetting Perpetual Subordinated Contingent Convertible Securities as Additional Tier 1 (AT1) securities, raising $1,987 million after issue costs.The principal terms of the AT1 securities are described below:

The securities are perpetual and redeemable, at the option of Standard Chartered PLC in whole but not in part, on the first call date or on any fifth anniversary after the first call date.
The securities are also redeemable for certain regulatory or tax reasons on any date at 100 per cent of their principal amount together with any accrued but unpaid interest to (but excluding) the date fixed for redemption. Any redemption is subject to Standard Chartered PLC giving notice to relevant regulator and the regulator granting permission to redeem.
The interest rate in respect of the securities for the period from (and including) the issue date to (but excluding) 2 April 2020 is a fixed rate of 6.50 per cent per annum. The reset date for the interest rate is 2 April 2020 and each date falling five, or an integral multiple of five years after the first reset date.
The interest rate on the securities will be payable semi-annually in arrears on 2 April and 2 October in each year, commencing on 2 October 2015 and will be accounted for as a dividend.
Interest on the securities is due and payable only at the sole and absolute discretion of Standard Chartered PLC, subject to certain additional restrictions set out in the terms and conditions. Accordingly, Standard Chartered PLC may at any time elect to cancel any interest payment (or part thereof) which would otherwise be payable on any interest payment date.
The securities convert into ordinary shares of Standard Chartered PLC, at a pre-determined price, should the fully loaded Common Equity Tier 1 ratio of the Group fall below 7.0 per cent.
The securities rank behind the claims against Standard Chartered PLC of (a) unsubordinated creditors, (b) which are expressed to be subordinated to the claims of unsubordinated creditors of Standard Chartered PLC but not further or otherwise; or (c) which are, or are expressed to be, junior to the claims of other creditors of Standard Chartered PLC, whether subordinated or unsubordinated, other than claims which rank, or are expressed to rank, pari passu with, or junior to, the claims of holders of the AT1 securities in a winding-up occurring prior to the conversion trigger.

Distributable reserves

As at 30 June 2015, the distributable reserves of Standard Chartered PLC (the Company) were $12.1 billion (31 December 2014: $12 billion).

19. Share capital, reserves and own shares continued

Own shares

Bedell Cristin Trustees Limited is trustee of both the 1995 Employees' Share Ownership Plan Trust (1995 Trust), and the Standard Chartered 2004 Employee Benefit Trust (2004 Trust). Both trusts are employee benefit trusts used in conjunction with some of the Group's employee share schemes and or for the delivery of other employee share based payments (such as fixed pay allowances). The trustee has agreed to satisfy a number of awards made under the Group's employee share schemes; the deferred bonus arrangements and fixed pay allowances delivered in shares through the trusts. As part of these arrangements, Group companies fund the trusts, from time to time, to enable the trustee to acquire shares to satisfy these awards. Except as disclosed, neither the Company nor any of its subsidiaries has bought, sold or redeemed any securities of the company listed on The Stock Exchange of Hong Kong Limited during the period. Details of the shares purchased and held by the trusts are set out below.

	1995 Trust			2004 Trust			Total
	30.06.15	30.06.14	31.12.14	30.06.15	30.06.14	31.12.14	30.06.15	30.06.14	31.12.14
Shares purchased during period	2,812,579	4,090,094	-	296,481	1,050,401	255,787	3,109,060	5,140,495	255,787
Market price of shares purchased ($ million)	43	84	-	5	21	5	48	105	5
Shares held at the end of the period	2,509,499	5,392,574	5,291,941	-	5,807	-	2,509,499	5,398,381	5,291,941
Maximum number of shares held during the period	7,517,013	8,591,232	7,808,099

20. Contingent liabilities and commitments

The table below shows the contract or underlying principal amounts and risk weighted amounts of unmatured off-balance sheet transactions at the balance sheet date. The contract or underlying principal amounts indicate the volume of business outstanding and do not represent amounts at risk.

	30.06.15	31.12.14
	$million	$million
Contingent liabilities
Guarantees and irrevocable letters of credit	30,528	33,318
Other contingent liabilities	9,004	9,214
	39,532	42,532
Commitments
Documentary credits and short term trade-related transactions	6,231	7,911
Forward asset purchases and forward deposits placed	224	78
Undrawn formal standby facilities, credit lines and other commitments to lend¹:
One year and over	45,482	42,380
Less than one year	16,859	18,490
Unconditionally cancellable	109,512	109,535
	178,308	178,394

¹ 2014 balances have been re-presented.

The Group's share of contingent liabilities and commitments relating to joint ventures is $326 million (2014: $336 million).

Contingent liabilities
Where the Group undertakes to make a payment on behalf of its customers for guarantees issued such as for performance bonds or as irrevocable letters of credit as part of the Group's transaction banking business for which an obligation to make a payment has not arisen at the reporting date those are included in these financial statements as contingent liabilities. Other contingent liabilities primarily include revocable letters of credit and bonds issued on behalf of customers to customs officials, for bids or offers and as shipping guarantees.

Commitments
Where the Group has confirmed its intention to provide funds to a customer or on behalf of a customer in the form of loans, overdrafts, future guarantees whether cancellable or not or letters of credit and the Group has not made payments at the balance sheet date, those instruments are included in these financial statement as commitments.

21. Legal and regulatory matters

While the Group seeks to comply with the letter and spirit of all applicable laws and regulations at all times, it has been, and may continue to be, subject to regulatory actions, reviews, requests for information (including subpoenas and requests for documents) and investigations across our markets, the outcomes of which are generally difficult to predict and can be material to the Group. The terms of settlements regarding US sanctions compliance reached with US authorities in 2012 include a number of conditions and ongoing obligations with regard to improving sanctions, Anti-Money Laundering (AML) and Bank Secrecy Act (BSA) controls such as remediation programmes, reporting requirements, compliance reviews and programmes, banking transparency requirements, training measures, audit programmes, disclosure obligations and, in connection with the New York Department of Financial Services (NYDFS) Consent Order, the appointment of an independent monitor (the "Monitor").

On 19 August 2014, the Group announced that it had reached a final settlement with the NYDFS regarding deficiencies in the AML transaction surveillance system in its New York branch (the "Branch"). The system, which is separate from the sanctions screening process, is one part of the Group's overall financial crime controls and is designed to alert the Branch to unusual transaction patterns that require further investigation on a post-transaction basis. The settlement provisions are summarised as follows:
(i) a civil monetary penalty of $300 million;
(ii) enhancements to the transaction surveillance system at the Branch;
(iii) a two-year extension to the term of the Monitor; and
(iv) a set of temporary remediation measures, which will remain in place until the transaction surveillance system's detection scenarios are operating to a standard approved by the Monitor.

On 9 December 2014, the Group announced that the Department of Justice (DOJ), District Attorney of New York (DANY) and the Group had agreed to a three-year extension of the Deferred Prosecution Agreements (DPAs) entered into in 2012 until 10 December 2017, and to the retention of a monitor to evaluate and make recommendations regarding the Group's sanctions compliance programme. The DOJ agreement acknowledges that the Group has taken a number of steps to comply with the requirements of the original DPAs and to enhance and optimise its sanctions compliance, including the implementation of more rigorous US sanctions policies and procedures, certified staff training, hiring of senior legal and financial crime compliance staff and recently implementing additional measures to block payment instructions for countries subject to US sanctions laws and regulations. The Group will work closely with the authorities to make additional substantial improvements to its US sanctions programme to reach the standard required by the DPAs. The DOJ agreement also indicates that the Group is co-operating with an investigation related to possible historical violations of US sanctions laws and regulations, but that additional time is needed for the authorities to complete the investigation and determine whether any violations have occurred. At the current stage of this investigation, the Group cannot predict the nature or timing of its outcome. There is a range of potential penalties for sanctions compliance violations, which could ultimately include substantial monetary penalties, additional compliance and remediation requirements and/or additional business restrictions. The Group recognises that its compliance with historical, current and future sanctions, as well as AML and BSA requirements, and customer due diligence practices, not just in the US but throughout its footprint are and will remain a focus of the relevant authorities. The Group continues to work closely with its home regulators on financial crime compliance. This has prompted changes to the processes in a number of the Group's markets and client segments.As a result, the Group has tightened client on-boarding procedures to reduce inherent risk, while continuing to improve controls. As part of their remit to oversee market conduct, regulators and other agencies in certain markets are conducting investigations or requesting reviews into a number of areas of regulatory compliance and market conduct, including sales and trading, involving a range of financial products, and submissions made to set various market interest rates and other financial benchmarks, such as foreign exchange. At relevant times, certain of the Group's branches and/or subsidiaries were (and are) participants in some of those markets, in some cases submitting data to bodies that set such rates and other financial benchmarks. The Group is contributing to industry proposals to strengthen financial benchmarks processes in certain markets and continues to review its practices and processes in the light of the investigations, reviews and the industry proposals. The Group is co-operating with all relevant ongoing reviews, requests for information and investigations. The outcome of these reviews, requests for information and investigations is uncertain and could result in further actions, penalties or fines but it is not possible to predict in all cases the extent of liabilities or other consequences that may arise. In meeting regulatory expectations and demonstrating active risk management, the Group also takes steps to restrict or restructure or otherwise mitigate higher risk business activities which could include divesting or closing businesses that exist beyond risk tolerances. In addition to these matters, the Group receives legal claims against it in a number of jurisdictions arising in the normal course of business. The Group considers none of these claims as material. Where appropriate, the Group recognises a provision for liabilities when it is probable that an outflow of economic resources embodying economic benefits will be required and for which a reliable estimate can be made of the obligation.

22. Post balance sheet events

Tax

On 8 July 2015 the UK government announced changes to tax rates. These changes have not been substantively enacted at the balance sheet date and accordingly have not been reflected in this half year report. The changes are as follows:

Reductions in the main rate of UK corporation tax: the effect of these reductions is to lower the rate to 19 per cent in 2017-18 and to 18 per cent in 2020-21. Management estimates that the impact of these changes will not be material to the Group
Corporation tax surcharge: an 8% corporation tax surcharge applies to UK profits of banks with effect from 1 January 2016. Management estimates that the annual impact of this change will not be material to the Group
UK Bank Levy: a phased reduction in the rate at which the UK Bank Levy is charged on qualifying liabilities is introduced. The current rates of 0.21 per cent for short term liabilities and 0.105 per cent for long term liabilities will be gradually reduced over the next 6 years. The rates applicable from 1 January 2021 will be 0.10 per cent for short term liabilities and 0.05 per cent for long term liabilities. In addition, the scope of the Bank Levy will be restricted to the balance sheet of UK operations only from 2021 onwards. There will be a consultation over the next couple of months regarding the restriction of scope

Group announcement on simplification of structure

On 19 July 2015, the Group announced a simplification of its organisational structure that will improve accountability, speed up decision making and operational efficiency. This involves:

a rationalised geographic structure, comprising four regional businesses (Greater China & North Asia; ASEAN & South Asia; Africa & Middle East and Europe & Americas)
a simplified client-facing structure, comprising three client businesses (Corporate & Institutional Banking; Commercial & Private Banking and Retail Banking)

The simplified organisational structure will be fully in place by 1 January 2016 and the Group's financial reporting will be based on the new structure from 1 January 2016.

23. Related party transactions

Directors, connected persons or officers

As at 30 June 2015, Standard Chartered Bank had created a charge over $79 million (30 June 2014: $74 million; 31 December 2014: $68 million) of cash assets in favour of the independent trustee of its employer financed retirement benefit scheme. Other than as disclosed in the accounts, there were no material transactions, arrangements or agreements outstanding for any director, connected person or officer of the Company which have to be disclosed under the Act, the rules of the UK Listing Authority or the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Hong Kong Listing Rules").

Associate and Joint Ventures

	30.06.15 $million	31.12.14 $million	30.06.15 $million	31.12.14 $million	30.06.15 $million	31.12.14 $million	30.06.15 $million	31.12.14 $million
	China Bohai Bank	China Bohai Bank	Asia Commercial Bank	Asia Commercial Bank	Clifford Capital	Clifford Capital	PT Bank Permata	PT Bank Permata
Assets
Loans and advances	-	29	-	74	-	-	30	136
Debt securities	-	-	-	114	-	-	-	120
Derivative assets	28	-	-	-	18	-	-	-
Total assets	28	29	-	188	18	-	30	256
Liabilities
Deposits	8	-	4	41	89	-	4	40
Derivative liabilities	1	-	-	-	1	-	-	-
Total liabilities	9	-	4	41	90	-	4	40
Loan commitments and other guarantees	-	-	50	-	-	-	50	1

Balances have been restated

24. Corporate governance

The directors confirm that, throughout the period, the Company has complied with the code provisions set out in the Corporate Governance Code contained in Appendix 14 of the Hong Kong Listing Rules, save that the Board Risk Committee is responsible for the oversight of internal control (other than internal control over financial reporting) and risk management systems (Hong Kong Corporate Governance Code provision C.3.3 paragraphs (f), (g) and (h)). If there were no Board Risk Committee, these matters would be the responsibility of the Audit Committee. The directors also confirm that the announcement of these results has been reviewed by the Company's Audit Committee. The Company confirms that it has adopted a code of conduct regarding securities transactions by directors on terms no less exacting than the required standard set out in Appendix 10 of the Hong Kong Listing Rules and that the directors of the Company have complied with the required standards of the adopted code of conduct throughout the period.

As previously announced Mr Oliver Stocken, CBE stepped down from the Board as an Independent Non-Executive Director on 28 February 2015. Ms Gay Huey Evans and Ms Jasmine Whitbread joined the Board as Independent Non-Executive Directors on 1 April 2015. Mr V Shankar and Mr Jaspal Bindra both stepped down from the Board as Group Executive Directors on 30 April 2015. Mr Peter Sands stepped down from the Board as Group Chief Executive on 10 June 2015 and Mr William Winters was appointed as Group Chief Executive on 10 June 2015. Mr Naguib Kheraj who was appointed to the Board in January 2014 was appointed as Senior Independent Director on 16 June 2015 replacing Ms Ruth Markland, who along with Mr Paul Skinner, CBE will step down from the Board by the end of 2015. Since 31 December 2014 the membership of a number of committees has changed resulting in a change in the emolument of a number of Independent Non-Executive Directors. A list of the committee's membership can be found at www.sc.com.

In compliance with Rule 13.51B(1) of the Hong Kong Listing Rules, the Board Regulatory Compliance Oversight Committee ceased to exist with effect from 1 January 2015. Sir John Peace, Mr Naguib Kheraj, Ms Ruth Markland, Mr Mike Rees, Mr V Shankar, Mr Paul Skinner, CBE and Dr Lars Thunell all stepped down from this committee from that date. The Board Financial Crime Risk Committee was established on 1 January 2015. Its membership comprises Mr Simon Lowth as Chairman and four members, Mrs Christine Hodgson, Mr Naguib Kheraj, Ms Ruth Markland and Dr Lars Thunell. Mrs Christine Hodgson was appointed as Chair of the Remuneration Committee and a member of the Governance and Nomination Committee on 7 May 2015. Ms Ruth Markland stepped down as Chair of the Remuneration Committee (although remains a member) and as a member of the Audit Committee on 6 May 2015. She also stepped down from the Governance and Nomination Committee on 15 June 2015. Ms Gay Huey Evans was appointed to the Board Risk Committee, Ms Jasmine Whitbread to the Remuneration Committee and Dr Byron Grote to the Remuneration Committee on 16 June 2015. Dr Byron Grote stepped down from the Brand, Values and Conduct Committee on 16 June 2015.

The Senior Independent Director receives a fee of GBP 40,000. Members of the Audit, Brand, Values and Conduct, Remuneration, Board Risk and Board Financial Crime Risk Committees receive a fee of GBP 30,000 per committee. Members of the Governance and Nomination Committee receive a fee of GBP 15,000 and the fee for Chairing the Remuneration and Board Financial Crime Risk Committees is GBP 60,000.

In compliance with Rule 13.51B (1) of the Hong Kong Listing Rules, the Company confirms that Dr Han Seung-soo, KBE, Independent Non-Executive Director was appointed as a Non-Executive Director of Doosan Infracore Co Ltd with effect from 27 March 2015, Ms Gay Huey Evans, Independent Non-Executive Director stepped down from the Board of Aviva PLC with effect from 29 April 2015. Dr Byron Grote, Independent Non-Executive Director stepped down from the Board of Unilever NV and Unilever PLC with effect from 29 April 2015 and 30 April 2015 respectively. He was appointed as Non-Executive Director of Tesco PLC with effect from 1 May 2015. Dr Lars Thunell, Independent Non-Executive Director stepped down from the Board of Kosmos Energy Ltd with effect from 2 June 2015.

25.# Statutory accounts

The information in this half year report is unaudited and does not constitute statutory accounts within the meaning of section 434 of the Companies Act 2006. This document was approved by the Board on 5 August 2015. The statutory accounts for the year ended 31 December 2014 have been reported by the Company's auditors and delivered to the Registrar of Companies in England and Wales. The report of the auditors was (i) unqualified, (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under section 498 of the Companies Act 2006.

26. UK and Hong Kong accounting requirements

As required by the Hong Kong Listing Rules, an explanation of the differences in accounting practices between EU endorsed IFRS and Hong Kong Financial Reporting Standards is required to be disclosed. There would be no significant differences had these accounts been prepared in accordance with Hong Kong Financial Reporting Standards. EU endorsed IFRS may differ from IFRSs published by the International Accounting Standards Board if a standard has not been endorsed by the EU.

Statement of directors' responsibilities

We confirm that to the best of our knowledge:

the condensed set of financial statements has been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the EU
the interim management report includes a fair review of the information required by:
(a) DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and
(b) DTR 4.2.8R of the Disclosure and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so.

By order of the Board
Andy Halford
Group Chief Financial Officer
5 August 2015

Independent review report by KPMG LLP to Standard Chartered PLC

Introduction

We have been engaged by the Company to review the condensed set of financial statements in the half-yearly financial report for the six months ended 30 June 2015 set out on pages 68 to 108, which comprises the condensed consolidated interim balance sheet, the condensed consolidated interim income statement, the condensed consolidated interim statement of comprehensive income, the condensed consolidated interim statement of changes in equity, the condensed consolidated interim cash flow statement, and the related explanatory notes. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements. This report is made solely to the Company in accordance with the terms of our engagement to assist the Company in meeting the requirements of the Disclosure and Transparency Rules ("the DTR") of the UK's Financial Conduct Authority ("the UK FCA"). Our review has been undertaken so that we might state to the Company those matters we are required to state to it in this report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company for our review work, for this report, or for the conclusions we have reached.

Directors' responsibilities

The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the DTR of the UK FCA. As disclosed in note 1, the annual financial statements of the Group are prepared in accordance with IFRSs as adopted by the EU. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the EU.

Our responsibility

Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.

Scope of review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 30 June 2015 is not prepared, in all material respects, in accordance with IAS 34 as adopted by the EU and the DTR of the UK FCA.

Michelle Hinchliffe
for and on behalf of KPMG LLP
Chartered Accountants
London
5 August 2015

Standard Chartered PLC - Additional information

A. Remuneration

Performance and reward philosophy and principles

The Group's approach to performance, reward and benefits supports and drives our business strategy and reinforces our values in the context of a clearly articulated risk appetite. It

supports a strong performance-oriented culture, ensuring that individual reward and incentives relate directly to:
(i) the performance and behaviour of the individual;
(ii) the performance of the business; and
(iii) the interests of shareholders
ensures a competitive reward package that reflects our international nature and enables us to attract, retain and motivate our employees
reflects the fact that many of our employees bring international experience and expertise, and we recruit from a global marketplace
encourages an appropriate mix of fixed and variable compensation based on
(i) the individual's responsibility; and
(ii) the individual's risk profile and that of the business

Total remuneration is typically delivered via a combination of base salary, benefits, variable compensation and, for some employees, a fixed pay allowance. Consistent with its pay for performance culture, the Group's discretionary variable compensation incentives play an integral role in enabling it to recognise and reward superior performance and behaviour that support the Group's values.

B. Group Share Plans 2011

Standard Chartered Share Plan (the '2011 Plan')

Approved by shareholders in May 2011, this is the Group's main share plan; applicable to all employees with the flexibility to provide a variety of award types. The 2011 Plan is designed to deliver various types of share awards including those subject to long term performance conditions, giving the Group sufficient flexibility to meet the challenges of the changing regulatory and competitive environment. Share awards are a key part of both executive directors' and senior management's variable compensation. Such awards ensure that there is an appropriate return for the risk taken and that the measure is aligned with the Group's risk appetite.

Deferred awards are used to deliver the deferred portion of total variable compensation, in line with both market practice and regulatory requirements. These awards are subject to a three or five year deferral period, vesting equally on each anniversary of the award date. Deferred awards are not subject to any plan limit. This enables the Group to meet regulatory requirements relating to deferral levels, and is in line with market practice.

Underpin shares are subject to a combination of two performance measures: earnings per share (EPS) growth and return on risk weighted assets (RoRWA). The weighting between the two elements is split equally, one-half of the award depending on each measure, assessed independently. Underpin share awards form part of the variable compensation awarded to executive directors. Discretionary variable compensation for executive directors will not exceed 200 per cent of fixed pay as valued in accordance with the European Banking Authority rules.

Performance shares are subject to a combination of three performance measures: relative total shareholder return (TSR), earnings per share (EPS) growth and return on risk weighted assets (RoRWA). The weighting between the three elements is split equally, one-third of the award depending on each measure, assessed independently. Performance share awards form part of the variable compensation awarded to executive directors. Details of deferred, underpin and performance shares awards for executive directors can be found in the Directors' remuneration report. Such awards accrue dividend equivalent payments, in the form of additional shares, during the vesting period. All awards are subject to the Group's claw-back policy.

Restricted share awards which are made outside of the annual performance process, as additional incentive or retention mechanisms, are provided as restricted shares under the 2011 Plan. These awards typically vest in equal instalments on the second and the third anniversaries of the award date.# Standard Chartered PLC - Additional information

In line with similar plans operated by our competitors, restricted share awards are not subject to an annual limit and do not have any performance conditions. The remaining life of the plan during which new awards can be made is six years.

2001 Performance Share Plan ('2001 PSP') - now closed to new grants

The Group's previous plan for delivering performance shares was the 2001 PSP and there remain outstanding vested awards. Under the 2001 PSP half the award is dependent upon TSR performance and the balance is subject to a target of defined EPS growth. Both measures use the same three-year period and are assessed independently.

2006 Restricted Share Scheme ('2006 RSS') / 2007 Supplementary Restricted Share Scheme ('2007 SRSS')

The Group's previous plans for delivering restricted shares were the 2006 RSS and 2007 SRSS both now replaced by the 2011 Plan. There remain outstanding vested awards under these plans. Awards were generally in the form of nil cost options and do not have any performance conditions. Generally deferred restricted share awards vest equally over three years and for non-deferred awards half vests two years after the date of grant and the balance after three years. No further awards will be granted under the 2006 RSS and 2007 SRSS.

All Employee Sharesave Plan (2004 International Sharesave, 2004 UK Sharesave and 2013 Sharesave)

Under the Sharesave plans, employees have the choice of opening a savings contract. Within a period of six months after the third or fifth anniversary, as appropriate, employees may purchase ordinary shares in the Company at a discount of up to 20 per cent on the share price at the date of invitation. There are no performance conditions attached to options granted under the Sharesave plans. In some countries in which the Group operates, it is not possible to operate Sharesave plans, typically due to securities law and regulatory restrictions. In these countries the Group offers an equivalent cash-based plan to its employees. The 2004 Sharesave plans are now closed and no further awards will be granted under these plans. The Standard Chartered 2013 Sharesave Plan was approved by Shareholders in May 2013 and all future sharesave invitations are made under this plan. The remaining life of the 2013 Sharesave Plan is eight years.

Valuation of options

Details of the valuation models used in determining the fair values of options granted under the Group's share plans are detailed in the Group's 2014 Annual Report and Accounts.

Reconciliation of option movements for the 6 months to 30 June 2015

	2011 Plan	1 PSP	1 RSS	1 SRSS	Sharesave	Weighted average Sharesave exercise price (£)
Performance Shares
Deferred / Restricted shares
Outstanding at 1 January 2015	14,277,137	18,235,300	249,645	2,245,347	663,148	10.91
Granted	83,787	10,350,841	-	-	-	-
Lapsed	(4,453,436)	(300,059)	(44,564)	(145,723)	(314,544)	(3,998,999)
Exercised	(431,456)	(6,388,521)	(42,821)	(535,003)	(126,007)	(222,692)
Outstanding at 30 June	9,476,032	21,897,561	162,260	1,564,621	222,597	9,795,852
Exercisable at 30 June 2015	382,462	3,639,176	162,260	1,564,621	222,597	-
Range of exercise prices (£)	-	-	-	-	-	9.85 - 14.63
Intrinsic value of vested but not exercised options ($ million)	0.3	3.3	0.4	1.7	0.4	-
Weighted average contractual remaining life (years)	8.2	5.8	2.9	2.1	1.8	1.6
Weighted average share price for options exercised during the period (£)	10.27	10.04	10.62	10.43	10.30	10.82

1 Employees do not contribute towards the cost of these awards
2 83,787 granted on 19 March 2015
3 243,724 (notional dividend) granted on 11 March 2015, 537,814 (notional dividend) granted on 13 March 2015, 9,426,009 granted on 19 March 2015, 140,722 granted on 17 June 2015, 256 (notional dividend) granted on 18 June 2015, 222 (notional dividend) granted on 19 June 2015, and 2,094 (notional dividend) granted on 20 June 2015

C. Non-executive directors' interests in ordinary shares as at 30 June 2015¹

	At 1 January 2015	Personal interests	Family interests	At 30 June 2015	Vested share awards	Unvested share awards
Chairman
Sir J W Peace	29,382	113,270	-	113,270	-	33,977
Independent non-executive directors
Current non-executive directors
O P Bhatt	2,000	2,000	-	2,000	N/A	N/A
Dr K M Campbell²	-	-	-	-	N/A	N/A
Dr L Cheung	2,000	2,000	-	2,000	N/A	N/A
Dr B E Grote	25,000	25,000	-	25,000	N/A	N/A
C M Hodgson	2,000	2,000	-	2,000	N/A	N/A
G Huey Evans³	-	2,000	-	2,000	N/A	N/A
N Kheraj	2,000	2,000	-	2,000	N/A	N/A
S J Lowth	10,854	11,162	-	11,162	N/A	N/A
R Markland	4,152	4,317	-	4,317	N/A	N/A
Dr Han Seung-soo, KBE	2,572	2,674	-	2,674	N/A	N/A
P D Skinner, CBE	16,467	17,122	-	17,122	N/A	N/A
Dr L H Thurnell	6,773	6,773	-	6,773	N/A	N/A
J Whitbread³	-	2,000	-	2,000	N/A	N/A
Former non-executive directors
O H J Stocken⁴	17,915	-	-	17,915	N/A	N/A

1 All figures are as at 30 June 2015 or on the retirement of a director, unless otherwise stated
2 Non-executive directors are required to hold shares with a nominal value of $1,000. All the directors, other than Dr Kurt Campbell, have met this requirement. Shareholders approved a resolution to disapply the shareholding qualification in relation to Dr Kurt Campbell at the Company's Annual General Meeting in May 2014
3 Gay Huey Evans and Jasmine Whitbread was appointed to the Board on 1 April 2015
4 Oliver Stocken resigned from the Board with effect from 28 February 2015

The beneficial interests of directors and their families in the ordinary shares of the Company are set out above. The directors do not have any non-beneficial interests in the Company's shares. No director had either (i) an interest in the Company's preference shares or loan stocks of any subsidiary or associated undertaking of the Group; or (b) any corporate interests in the Company's ordinary shares.

D. Executive directors' interests in ordinary shares as at 30 June 2015

	Scheme interests awarded	Interest awarded	Face value¹	GBP Percentage vesting at threshold (if applicable)	Number of shares
A N Halford	Performance share award²	283,226	25%	27,154	31 Dec 2019
	Underpin share award³	141,614	100%	13,577	31 Dec 2017
	Underpin share award³	141,614	100%	13,577	31 Dec 2017
	Deferred share award⁴	385,188	-	36,930	-

1 Face value calculated based on share value at date of grant
19 March 2015
2 Performance share awards are exercisable between 19 March 2020 and 19 March 2025 subject to meeting long term performance conditions
3 Underpin share awards are exercisable between either 19 March 2018 and 19 March 2022 or 19 March 2020 and 19 March 2022, subject in both cases to meeting long term performance conditions assessed over a three year period
4 Deferred share awards are not subject to performance conditions and are exercisable between 19 March 2018 and 19 March 2022

All the above awards were made in respect of 2014 performance and are part of 2014 total variable compensation decisions disclosed in the 2014 Annual Report and Accounts. All are subject to notional dividend payments at the date of vesting.

Executive directors' shareholdings as at 30 June 2015¹

	Shares held beneficially²	Actual shareholding requirement in number of shares	Alignment to requirement	Awards exercised³	Vested but unexercised deferred share awards	Deferred share awards not subject to performance conditions	Deferred share awards subject to performance conditions
W T Winters⁴	2,000	250,000	on track	-	-	-	-
A M G Rees	243,754	200,000	met	-	304,701	202,564	344,384
A N Halford⁵	92,055	150,000	on track	-	-	36,930	182,853
P A Sands⁶	322,341	250,000	met	106,434	-	75,486	387,495
J S Bindra⁷	283,247⁸	150,000	met	56,574	-	42,162	210,293
V Shankar⁷	236,127	150,000	met	69,380	-	45,554	230,591

1 All figures are as at 30 June 2015 or on the retirement of an executive director, unless stated otherwise
2 Fixed pay allowance shares are included in the totals beneficially held by each executive director. However, they do not immediately count for the purposes of meeting any shareholding requirement
3 During the relevant period, the executive directors exercised nil cost options (being performance share awards and deferred share awards that have been reported in previous years) over a total of 232,388 shares on 13 March 2015. The closing share price on the day before exercise was £9.65
4 Bill Winters joined the Board on 10 June 2015 and will be required to meet his shareholding requirement within a reasonable period of time
5 Andy Halford joined the Board on 1 July 2014 and will be required to meet his shareholding requirement within a reasonable period of time
6 Peter Sands stepped down from the Board on 10 June 2015. Figures shown are as at 10 June 2015
7 Jaspal Bindra and V Shankar both stepped down from the Board on 30 April 2015. Figures shown are as at 30 April 2015
8 153,000 of these shares are subject to a charge from 28 December 2011

The beneficial interests of executive directors and their families in the ordinary shares of the Company are set out above. The executive directors do not have any non-beneficial interests in the Company's shares. No executive director had either (i) an interest in the Company's preference shares or loan stocks of any subsidiary or associated undertaking of the Group; or (b) any corporate interests in the Company's ordinary shares.

D. Executive directors' interests in ordinary shares as at 30 June 2015 continued

Sharesave

Director	Date of grant	At 1 January 2015	Exercise price (pence)	Awarded during the year	Exercised	Lapsed	At 30 June 2015 (or date of retirement)	Period of exercise
P A Sands¹	1 Oct 2012	789	1,140	-	-	-	789	2015-2016
J S Bindra²	9 Oct 2009	1,407	1,104	-	-	-	1,407	2014-2015
J S Bindra²	8 Oct 2014	913	985	-	-	913	-	2018-2019

1 Peter Sands stepped down from the Board on 10 June 2015.## E. Share price information

The middle market price of an ordinary share at the close of business on 30 June 2015 was 1,019 pence. The share price range during the first half of 2015 was 881 pence to 1,141 pence (based on the closing middle market prices).

F. Substantial shareholders

The Company and its shareholders have been granted partial exemption from the disclosure requirements under Part XV of the Securities and Futures Ordinance (SFO). As a result of this exemption, shareholders no longer have an obligation under the SFO to notify the Company of substantial shareholding interests, and the Company is no longer required to maintain a register of interests of substantial shareholders under section 336 of the SFO. The Company is, however, required to file with The Stock Exchange of Hong Kong Limited any disclosure of interests made in the UK.

G. Code for Financial Reporting Disclosure

The British Bankers' Association Code for Financial Reporting Disclosure sets out five disclosure principles together with supporting guidance. The principles are that UK banks will: provide high quality, meaningful and decision useful disclosures; review and enhance their financial instrument disclosures for key areas of interest; assess the applicability and relevance of good practice recommendations to their disclosures acknowledging the importance of such guidance; seek to enhance the comparability of financial statement disclosures across the UK banking sector; and clearly differentiate in their annual reports between information that is audited and information that is unaudited. The Group's interim financial statements for the six months ended 30 June 2015 have been prepared in accordance with the Code's principles.

H. Shareholder information

2015 interim dividend

Ex-dividend date¹	Record date for dividend	Dividend payment date
13 August 2015	14 August 2015	19 October 2015

¹ Ex-dividend date is Wednesday 12 August 2015 for the Hong Kong branch register

2015 final dividend (provisional only)

Results and dividend announcement date
23 February 2016

Preference shares

Next half-yearly dividend
7 3/8 per cent Non-Cumulative Irredeemable preference shares of £1 each
8 ¼ per cent Non-Cumulative Irredeemable preference shares of £1 each
6.409 per cent Non-Cumulative preference shares of $5 each
7.014 per cent Non-Cumulative preference shares of $5 each

Previous dividend payments (not adjusted for rights issue)

Dividend and financial year	Payment date	Dividend per ordinary share	Cost of one new ordinary share under the share dividend scheme
Interim 2004	8 October 2004	17.06c/9.4851p/HK$1.3303	£9.546/$17.16958
Final 2004	13 May 2005	40.44c/21.145p/HK$3.15156	£9.384/$17.947
Interim 2005	14 October 2005	18.94c/10.7437p/HK$1.46911	£11.878/$21.3578
Final 2005	12 May 2006	45.06c/24.9055p/HK$3.49343	£14.2760/$24.77885
Interim 2006	11 October 2006	20.83c/11.14409p/HK$1.622699	£13.2360/$25.03589
Final 2006	11 May 2007	50.21c/25.17397p/HK$3.926106	£14.2140/$27.42591
Interim 2007	10 October 2007	23.12c/11.39043p/HK$1.794713	£15.2560/$30.17637
Final 2007	16 May 2008	56.23c/28.33485p/HK$4.380092	£16.2420/$32.78447
Interim 2008	9 October 2008	25.67c/13.96133p/HK$1.995046	£14.00/$26.0148
Final 2008	15 May 2009	42.32c/28.4693p/HK$3.279597	£8.342/$11.7405
Interim 2009	8 October 2009	21.23c/13.25177p/HK$1.645304	£13.876/$22.799
Final 2009	13 May 2010	44.80c/29.54233p/HK$3.478306	£17.351/$26.252
Interim 2010	5 October 2010	23.35c/14.71618p/HK$1.811274/INR0.984124*	£17.394/$27.190
Final 2010	11 May 2011	46.45c/28.2725p/HK$3.623404/INR1.9975170*	£15.994/$25.649
Interim 2011	7 October 2011	24.75c/15.81958125p/HK$1.928909813/INR1.13797125*	£14.127/$23.140
Final 2011	15 May 2012	51.25c/31.63032125p/HK$3.9776083375/INR2.6667015*	£15.723/$24.634
Interim 2012	11 October 2012	27.23c/16.799630190p/HK$2.111362463/INR1.349803950*	£13.417/$21.041
Final 2012	14 May 2013	56.77c/36.5649893p/HK$4.4048756997/INR2.976283575*	£17.40/$26.28792
Interim 2013	17 October 2013	28.80c/17.8880256p/HK$2.233204992/INR1.6813*	£15.362/$24.07379
Final 2013	14 May 2014	57.20c/33.9211444p/HK$4.43464736/INR3.354626*	£11.949/$19.815
Interim 2014	20 October 2014	28.80c/17.891107200p/HK$2.2340016000/INR1.671842560*	£12.151/$20.207
Final 2014	14 May 2015	57.20c/37.16485p/HK$4.43329/INR3.514059*	£9.797/$14.374

The INR dividend is per Indian Depository Receipt

ShareCare

ShareCare is available to shareholders on the Company's UK register who have a UK address and bank account, and allows you to hold your Standard Chartered shares in a nominee account. Your shares will be held in electronic form so you will no longer have to worry about keeping your share certificates safe. If you join ShareCare you will still be invited to attend the Company's AGM and you will still receive your dividend at the same time as everyone else. ShareCare is free to join and there are no annual fees to pay. If you would like to receive more information please visit our website at: http://investors.sc.com/en/resource.cfm or contact the shareholder helpline on 0370 702 0138.

Donating shares to ShareGift

Shareholders who have a small number of shares often find it uneconomical to sell them. An alternative is to consider donating them to the charity ShareGift (registered charity 1052686), which collects donations of unwanted shares until there are enough to sell and uses the proceeds to support UK charities. Further information can be obtained from the Company's Registrars or from ShareGift on 020 7930 3737 or from www.sharegift.org. There is no implication for Capital Gains Tax (no gain no loss) when you donate shares to charity and UK tax payers may be able to claim income tax relief on the value of their donation.

Bankers' Automated Clearing System (BACS)

Dividends can be paid straight into your bank or building society account. Please register online at www.investorcentre.co.uk or contact our registrar for a mandate form.

Registrars and shareholder enquiries

If you have any enquiries relating to your shareholding and you hold your shares on the United Kingdom register, please contact our registrar Computershare Investor Services PLC at The Pavilions, Bridgwater Road, Bristol, BS99 6ZZ, or contact the shareholder helpline on 0370 702 0138.

If you hold your shares on the Hong Kong branch register and you have enquiries, please contact Computershare Hong Kong Investor Services Limited, 17M Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong. You can check your shareholding at: www.computershare.com/hk/investors.

If you hold Indian Depository Receipts and you have enquiries, please contact Karvy Computershare Private Limited, 17-24, Vithalrao Nagar, Madhapur, Hyderabad 500 001, India.

Chinese translation

If you would like a Chinese version of this Half year report, please contact: Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong.
本半年報告之中文譯本可向香港中央證券登記有限公司索取，地址：香港灣仔皇后大道東183號合和中心17M樓。

Shareholders on the Hong Kong branch register who have asked to receive corporate communications in either Chinese or English can change this election by contacting Computershare. If there is a dispute between any translation and the English version of this Half year report, the English text shall prevail.

Taxation

Information on taxation applying to dividends paid to you if you are a shareholder in the United Kingdom, Hong Kong and the United States will be sent to you with your dividend documents

I. Convenience translation of selected financial statements into Indian Rupees

In compliance with clause 37(3) of Indian Depository Receipts Listing agreement, the Consolidated financial statements on pages 58 to 72 are presented in Indian rupees (INR) using a US dollar / Indian rupee exchange rate of 63.7549 as at 30 June 2015 as published by Reserve Bank of India. Amounts have been translated using the said exchange rate including totals and sub-totals and any discrepancies in any table between totals and sums of the amounts listed are due to rounding.

Condensed consolidated interim income statement (Translated to INR)

For the six months ended 30 June 2015

	6 months ended 30.06.15	6 months ended 30.06.14	6 months ended 31.12.14
	Rs. million	Rs. million	Rs. million
Interest income	490,084	548,483	534,330
Interest expense	(171,819)	(191,201)	(190,117)
Net interest income	318,264	357,282	344,213
Fees and commission income	141,090	145,616	150,908
Fees and commission expense	(16,257)	(14,217)	(15,875)
Net trading income	61,778	60,822	60,057
Other operating income	54,192	40,484	39,592
Non-interest income	240,802	232,705	234,682
Operating income	559,067	589,988	578,894
Staff costs	(211,666)	(220,209)	(212,559)
Premises costs	(25,629)	(28,116)	(29,901)
General administrative expenses	(62,799)	(55,786)	(116,863)
Depreciation and amortisation	(21,358)	(19,955)	(20,784)
Operating expenses	(321,452)	(324,066)	(380,107)
Operating profit before impairment losses and taxation	237,615	265,922	198,788
Impairment losses on loans and advances and other credit risk provisions	(105,323)	(53,937)	(82,563)
Other impairment
Goodwill	-	-	(48,326)
Other	(5,483)	(11,795)	(13,899)
Profit from associates and joint ventures	6,949	7,204	8,607
Profit before taxation	133,758	207,395	62,607
Taxation	(36,149)	(54,128)	(43,417)
Profit for the period	97,609	153,267	19,190
Profit attributable to:
Non-controlling interests	1,211	2,805	3,060
Parent company shareholders	96,397	150,462	16,130
Profit for the period	97,609	153,267	19,190
	Rupees	Rupees	Rupees
Earnings per share:
Basic earnings per ordinary share	37.4	60.3	5.2
Diluted earnings per ordinary share	37.2	59.9	5.2
Dividends per ordinary share:
Interim dividend declared	9.18

For the six months ended 30 June 2015

	6 months ended 30.06.15	6 months ended 30.06.14	6 months ended 31.12.14
Rs.million	Rs.million	Rs.million	Rs.million
Profit for the period	97,609	153,267	19,190
Other comprehensive income :
Items that will not be reclassified to Income statement:
Actuarial gains/(losses) on retirement benefit obligations	956	(4,463)	574
Items that may be reclassified subsequently to Income statement:
Exchange differences on translation of foreign operations:
Net (losses)/gains taken to equity	(38,508)	22,824	(92,317)
Net gains/(losses) on net investment hedges	1,275	(3,698)	4,973
Share of other comprehensive income from associates and joint ventures	(64)	383	701
Available-for-sale investments:
Net valuation gains taken to equity	8,926	17,724	12,815
Reclassified to income statement	(10,073)	(15,875)	(11,093)
Cash flow hedges:
Net gains/(losses) taken to equity	510	4,272	(11,667)
Reclassified to income statement	2,805	191	638
Taxation relating to components of other comprehensive income	(1,403)	(1,913)	510
Other comprehensive income for the period, net of taxation	(35,575)	19,445	(94,867)
Total comprehensive income for the period	62,034	172,712	(75,677)
Total comprehensive income attributable to:
Non-controlling interests	(701)	1,849	2,168
Parent company shareholders	62,735	170,863	(77,845)
	62,034	172,712	(75,677)

Condensed consolidated interim balance sheet (Translated to INR)

As at 30 June 2015

	30.06.15	31.12.14
Rs.million	Rs.million	Rs.million
Assets
Cash and balances at central banks	4,926,596	6,202,204
Financial assets held at fair value through profit or loss	1,900,470	2,079,876
Derivative financial instruments	3,879,996	4,197,240
Loans and advances to banks	5,127,488	5,348,399
Loans and advances to customers	17,799,603	18,150,701
Investment securities	7,091,521	6,645,683
Other assets	2,410,509	2,466,613
Current tax assets	24,673	23,079
Prepayments and accrued income	163,404	168,759
Interests in associates and joint ventures	126,936	125,087
Goodwill and intangible assets	332,992	330,888
Property, plant and equipment	493,463	509,019
Deferred tax assets	29,200	33,025
Total assets	44,306,850	46,280,574
Liabilities
Deposits by banks	3,169,065	3,467,693
Customer accounts	24,066,136	25,843,240
Financial liabilities held at fair value through profit or loss	1,614,784	1,427,472
Derivative financial instruments	3,739,289	4,036,514
Debt securities in issue	4,537,117	4,587,229
Other liabilities	2,187,622	1,993,871
Current tax liabilities	49,793	56,806
Accruals and deferred income	331,908	377,110
Subordinated liabilities and other borrowed funds	1,415,168	1,462,984
Deferred tax liabilities	17,405	15,684
Provisions for liabilities and charges	6,567	5,865
Retirement benefit obligations	26,076	26,331
Total liabilities	41,160,928	43,300,798
Equity
Share capital	81,160	78,801
Share premium	347,464	349,504
Other reserves	583,549	617,785
Retained earnings	1,989,408	1,914,177
Total parent company shareholders' equity	3,001,581	2,960,268
Other equity instruments	126,681	-
Total equity excluding non-controlling interests	3,128,262	2,960,268
Non-controlling interests	17,660	19,509
Total equity	3,145,922	2,979,777
Total equity and liabilities	44,306,850	46,280,574

Consolidated statement of changes in equity (Translated to INR)

For the six months ended 30 June 2015

	Share capital and Capital redemption reserve¹	Share premium account	Other equity instruments	Merger reserve	Available -for-sale reserve	Cash flow hedge reserve	Translation reserve	Retained earnings	Parent company shareholders' equity	Non-controlling interests	Total
Rs.million	Rs.million	Rs.million	Rs.million	Rs.million	Rs.million	Rs.million	Rs.million	Rs.million	Rs.million	Rs.million	Rs.million
At 1 January 2014	427,604	-	1,148	791,900	28,435	956	(134,268)	1,832,635	2,948,409	37,934	2,986,343
Profit for the period	-	-	-	-	-	-	-	150,462	150,462	2,805	153,267
Other comprehensive income	-	-	-	-	(319)	3,762	20,593	(3,634)²	20,402	(956)	19,445
Distributions	-	-	-	-	-	-	-	-	-	(2,996)	(2,996)
Shares issued, net of expenses	574	-	-	-	-	-	-	-	574	-	574
Net own shares adjustment	-	-	-	-	-	-	-	(5,674)	(5,674)	-	(5,674)
Share option expense, net of taxation	-	-	-	-	-	-	-	8,607	8,607	-	8,607
Capitalised on scrip dividend	-	-	-	-	-	-	-	-	-	-	-
Dividends, net of scrip	-	-	-	-	-	-	-	(45,776)	(45,776)	-	(45,776)
Other increases/(decreases)³	-	-	-	-	-	-	-	893	893	(18,616)	(17,724)
At 30 June 2014	428,178	-	1,148	791,900	28,116	4,718	(113,675)	1,937,511	3,077,895	18,170	3,096,065
Profit for the period	-	-	-	-	-	-	-	16,130	16,130	3,060	19,190
Other comprehensive income	-	-	-	-	956	(8,352)	(87,025)	446²	(93,975)	(893)	(94,867)
Distributions	-	-	-	-	-	-	-	-	-	(829)	(829)
Shares issued, net of expenses	128	-	-	-	-	-	-	-	128	-	128
Net own shares adjustment	-	-	-	-	-	-	-	(255)	(255)	-	(255)
Share option expense, net of taxation	-	-	-	-	-	-	-	7,077	7,077	-	7,077
Dividends, net of scrip	-	-	-	-	-	-	-	(46,732)	(46,732)	-	(46,732)
At 31 December 2014	428,305	-	1,148	791,900	29,072	(3,634)	(200,700)	1,914,177	2,960,268	19,509	2,979,777
Profit for the period	-	-	-	-	-	-	-	96,397	96,397	1,211	97,609
Other comprehensive income	-	-	-	-	(829)	1,976	(35,384)	574²	(33,663)	(1,913)	(35,575)
Distributions	-	-	-	-	-	-	-	-	-	(1,084)	(1,084)
Shares issued, net of expenses	319	-	-	-	-	-	-	-	319	-	319
Other equity instruments issued, net of expenses	-	126,681	-	-	-	-	-	-	126,681	-	126,681
Net own shares adjustment	-	-	-	-	-	-	-	(1,913)	(1,913)	-	(1,913)
Share option expense, net of taxation	-	-	-	-	-	-	-	10,010	10,010	-	10,010
Capitalised on scrip dividend	-	-	-	-	-	-	-	-	-	-	-
Dividends, net of scrip	-	-	-	-	-	-	-	(29,837)	(29,837)	-	(29,837)
Other decrease	-	-	-	-	-	-	-	-	-	(64)	(64)
At 30 June 2015	428,624	126,681	1,148	791,900	28,243	(1,658)	(236,084)	1,989,408	3,128,262	17,660	3,145,922

1 Includes capital reserve of Rs.319 million and capital redemption reserve of Rs.829 million
2 Comprises actuarial gains, net of taxation and non-controlling interests of Rs.574 million (30 June 2014: loss of Rs.3,634 million and 31 December 2014: gain of Rs.638 million)
3 Relate to the redemption of $300 million 7.267% Hybrid Tier 1 securities issued by Standard Chartered Bank Korea Limited

Condensed consolidated interim cash flow statement (translated to INR)

For the six months ended 30 June 2015

	6 months ended 30.06.15	6 months ended 30.06.14	6 months ended 31.12.14
Rs.million	Rs.million	Rs.million	Rs.million
Cash flows from operating activities
Profit before taxation	133,758	207,395	62,607
Adjustments for:
Non-cash items included within income statement	134,905	98,183	186,802
Change in operating assets	587,884	(65,285)	(805,416)
Change in operating liabilities	(2,000,310)	499,520	3,282,485
Contributions to defined benefit schemes	(1,976)	(1,594)	(4,654)
UK and overseas taxes paid	(39,719)	(53,044)	(55,849)
Net cash (used in)/from operating activities	(1,185,459)	685,174	2,665,975
Cash flows from investing activities
Purchase of property, plant and equipment	(3,251)	(4,718)	(7,332)
Disposal of property, plant and equipment	3,698	1,339	2,933
Investment in associates and joint ventures	-	-	(4,080)
Disposal of subsidiaries	42,397	-	-
Purchase of investment securities	(7,636,881)	(5,962,422)	(6,536,981)
Disposal and maturity of investment securities	7,122,634	6,149,160	6,095,287
Dividends received from associates and joint ventures	701	701	128
Net cash (used in)/from investing activities	(470,702)	184,060	(450,046)
Cash flows from financing activities
Issue of ordinary and preference share capital, net of expenses	319	574	128
Issue of additional tier-1 capital, net of expenses	126,681	-	-
Purchase of own shares	(2,486)	(6,694)	(319)
Exercise of share options through ESOP	574	1,020	64
Interest paid on subordinated liabilities	(37,042)	(33,790)	(35,703)
Gross proceeds from issue of subordinated liabilities	-	258,590	40,038
Repayment of subordinated liabilities	-	(18,170)	(116,608)
Interest paid on senior debts	(16,895)	(26,012)	(21,167)
Gross proceeds from issue of senior debts	308,701	216,384	203,059
Repayment of senior debts	(198,533)	(271,277)	(137,264)
Dividends paid to non-controlling interests and preference shareholders, net of scrip	(4,272)	(6,184)	(4,080)
Dividends paid to ordinary shareholders, net of scrip	(26,650)	(42,588)	(43,481)
Net cash from/(used in) financing activities	150,398	52,725	(115,333)
Net (decrease)/increase in cash and cash equivalents	(1,505,763)	921,960	2,100,596
Cash and cash equivalents at beginning of the period	8,279,849	5,365,357	6,301,598
Effect of exchange rate movements on cash and cash equivalents	(49,155)	14,281	(122,346)
Cash and cash equivalents at end of the period	6,724,931	6,301,598	8,279,849

Summary of significant differences between Indian GAAP and IFRS

The condensed consolidated financial statements of the Group for the period ended 30 June 2015 with comparatives as at 31 December 2014 and 30 June 2014 are prepared in accordance with International Financial Reporting Standards (IFRS) and IFRS Interpretations Committee (IFRIC) interpretations as adopted by the European Union. IFRS differs in certain significant respects from Indian Generally Accepted Accounting Principles (GAAP). Such differences involve methods for measuring the amounts shown in the financial statements of the Group, as well as additional disclosures required by Indian GAAP.# Set out below are descriptions of certain accounting differences between IFRS and Indian GAAP that could have a significant effect on profit attributable to parent company shareholders for the period ended 30 June 2015, 30 June 2014 and 31 December 2014 and total parent company shareholders' equity as at the same dates.

This section does not provide a comprehensive analysis of such differences. In particular, this description considers only those Indian GAAP pronouncements for which adoption or application is required in financial statements for years ended on or prior to 30 June 2015. The Group has not quantified the effect of differences between IFRS and Indian GAAP, nor prepared condensed consolidated financial statements under Indian GAAP, nor undertaken a reconciliation of IFRS and Indian GAAP financial statements. Had the Group undertaken any such quantification or preparation or reconciliation, other potentially significant accounting and disclosure differences may have come to its attention which are not identified below.

Accordingly, the Group does not provide any assurance that the differences identified below represent all the principal differences between IFRS and Indian GAAP relating to the Group. Furthermore, no attempt has been made to identify future differences between IFRS and Indian GAAP. Finally, no attempt has been made to identify all differences between IFRS and Indian GAAP that may affect the financial statements as a result of transaction or events that may occur in the future.

In making an investment decision, potential investors should consult their own professional advisers for an understanding of the differences between IFRS and Indian GAAP and how those differences may have affected the financial results of the Group. The summary does not purport to be complete and is subject, and qualified in its entirety by reference, to the pronouncements of the International Accounting Standards Board (IASB), together with the pronouncements of the Indian accounting profession.

Changes in accounting policy

IFRS (IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors)

Changes in accounting policy are applied retrospectively. Comparatives are restated and the effect of period(s) not presented is adjusted against opening retained earnings of the earliest year presented. Policy changes made on the adoption of a new standard are made in accordance with that standard's transitional provisions.

Indian GAAP (AS 5 Net Profit or Loss for the period, Prior Period Items and Changes in Accounting Policies)

The cumulative amount of the change is included in the income statement for the period in which the change is made except as specified in certain standards (transitional provision) where the change during the transition period resulting from adoption of the standard has to be adjusted against opening retained earnings and the impact disclosed. Where a change in accounting policy has a material effect in the current period, the amount by which any item in the financial statements is affected by such change should also be disclosed to the extent ascertainable. Where such an amount is not ascertainable this fact should be indicated.

Functional and presentation currency

IFRS (IAS 21 The Effects of Changes in Foreign Exchange Rates)

An entity may present its financial statements in any currency (or currencies). If the presentation currency differs from the entity's functional currency, it translates its results and financial position into the presentation currency. Assets and liabilities are translated at the closing rate at the date of that statement of financial position. Income statement items are translated at the exchange rate at the date of transaction or at average rates. The functional currency is the currency of the primary economic environment in which an entity operates. The presentation currency of the Group is US dollars.

Indian GAAP (AS 11 The Effects of Changes in Foreign Exchange Rates)

There is no concept of functional or presentation currency. Entities in India have to prepare their financial statements in Indian rupees. A foreign currency transaction should be recorded, on initial recognition in the reporting currency, by applying to the foreign currency amount, the exchange rate between the reporting currency and the foreign currency at the date of the transaction. At each balance sheet date:
* foreign currency monetary items should be reported using the closing rate
* non-monetary items which are carried in terms of historical cost denominated in a foreign currency should be reported using the exchange rate at the date of the transaction
* non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency should be reported using the exchange rates that existed when the values were determined

Summary of significant differences between Indian GAAP and IFRS continued

Consolidation

IFRS (IFRS 10 Consolidated Financial Statements)

Entities are consolidated when the Group controls an entity. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the investee. This includes entities where control is not derived through voting rights such as structured entities.

Indian GAAP (AS 21 Consolidated Financial Statements)

Guidance is based on the power through the ability to govern the financial and operating policies of an entity so as to obtain benefits while not taking into consideration potential voting rights.

Indian GAAP (Consolidation of Structured Entities)

No specific guidance.

Business combinations

IFRS (IFRS 3 Business Combinations)

All business combinations are treated as acquisitions. Assets, liabilities and contingent liabilities acquired are measured at their fair values. Pooling of interest method is prohibited. For acquisitions occurring on or after 1 January 2004, IFRS 3 requires that, when assessing the value of the assets of an acquired entity, certain identifiable intangible assets must be recognised and if considered to have a finite life, amortised through the income statement over an appropriate period. As the Group has not applied IFRS 3, or its predecessor IAS 22, to transactions that occurred before 1 January 2004, no intangible assets, other than goodwill, were recognised on acquisitions prior to that date. Adjustments to provisional fair values are permitted provided those adjustments are made within 12 months from the date of acquisition, with a corresponding adjustment to goodwill. After re-assessment of respective fair values of net assets acquired, any excess of acquirer's interest in the net fair values of acquirer's identifiable assets is recognised immediately in the income statement. Where less than 100 per cent of an entity is acquired, non-controlling interests are stated at their proportion of the fair value of the identifiable net assets and contingent liabilities acquired.

Indian GAAP (AS 14 Accounting for Amalgamations)

Treatment of a business combination depends on whether the acquired entity is held as a subsidiary, whether it is an amalgamation or whether it is an acquisition of a business. For an entity acquired and held as a subsidiary, the business combination is accounted for as an acquisition. The assets and liabilities acquired are incorporated at their existing carrying amounts. For an amalgamation of an entity, either pooling of interests or acquisition accounting may be used. The assets and liabilities amalgamated are incorporated at their existing carrying amounts or, alternatively, if acquisition accounting is adopted, the consideration can be allocated to individual identifiable assets (which may include intangible assets) and liabilities on the basis of their fair values. Adjustments to the value of acquired or amalgamated balances are not permitted after initial recognition. Any excess of acquirer's interest in the net fair values of acquirer's identifiable assets is recognised as capital reserve, which is neither amortised nor available for distribution to shareholders. However, in the case of an amalgamation accounted for under the purchase method, the fair value of intangible assets with no active market is reduced to the extent of capital reserve, if any, arising on the amalgamation. Minority interests arising on the acquisition of a subsidiary are recognised at their share of the historical book value.

Goodwill

IFRS (IFRS 3 Business Combinations and IAS 38 Intangible Assets)

IFRS 3 requires that goodwill arising on all acquisitions by the Group and associated undertakings is capitalised but not amortised and is subject to an annual review for impairment. Under the transitional provisions of IFRS 1, the Group has not applied IFRS 3, or its predecessor IAS 22, to transactions that occurred before 1 January 2004, the date of transition to IFRS. Accordingly, goodwill previously written off to reserves, as permitted under UK GAAP until the implementation of FRS 10 Goodwill and intangible assets in 1998, has not been reinstated nor will it be written back on disposal. Amortisation of goodwill that has been charged up to 31 December 2003 has not been reversed and the deemed carrying value of the goodwill on transition to IFRS is equal to the net book value as at 31 December 2003. Goodwill is tested annually for impairment. Any impairment losses recognised may not be reversed in subsequent accounting periods.

Indian GAAP (AS 14 Accounting for Amalgamations and AS 26 Intangible Assets)

Goodwill arising for amalgamations is capitalised and amortised over their useful life not exceeding five years, unless a longer period can be justified. For goodwill arising on acquisition of a subsidiary or a business, there is no specific guidance. In practice there is either no amortisation or amortisation is not exceeding 10 years.# Summary of significant differences between Indian GAAP and IFRS continued

Acquired and internally generated intangible assets

IFRS (IAS 38 Intangible Assets)

Intangible assets are recognised if the specific criteria are met. Assets with a finite useful life are amortised on a systematic basis over their useful life. An asset with an indefinite useful life and which is not yet available for use should be tested for impairment annually.

Indian GAAP (AS 26 Intangible Assets)

Intangible assets are capitalised if specific criteria are met and are amortised over their useful lives, generally not exceeding 10 years. The recoverable amount of an intangible asset that is not available for use or is being amortised over a period exceeding 10 years should be reviewed at least at each financial year-end even if there is no indication that the asset is impaired.

Property, plant and equipment

IFRS (IAS 16 Property, Plant and Equipment; IAS 23 Borrowing Costs)

Fixed assets are recorded at cost or revalued amounts. Under the transition rules of IFRS 1, the Group elected to freeze the value of all its properties held for its own use at their 1 January 2004 valuations, their deemed cost under IFRS. They will not be revalued in the future. Foreign exchange gains or losses relating to the procurement of property, plant and equipment, under very restrictive conditions, can be capitalised as part of the asset. Depreciation is recorded over the asset's estimated useful life. The residual value, the useful life of an asset and the depreciation method shall be reviewed at least at each financial year-end. The Group has the option to capitalise borrowing costs incurred during the period that the asset is getting ready for its intended use.

Indian GAAP (AS 10 Fixed Assets, AS 16 Borrowing Cost and AS 6 Depreciation Accounting)

Fixed assets are recorded at historical costs or revalued amounts. Relevant borrowing costs are capitalised if certain criteria in AS 16 are met. Depreciation is recorded over the asset's useful life. Schedule II (Part C) of the Companies Act 2013 and Banking Regulations prescribe rates of depreciation and these are typically used as the basis for determining useful life.

Recognition and measurement of financial instruments

IFRS (IAS 39 Financial Instruments: Recognition and Measurement)

IAS 39 requires all financial instruments to be initially measured at their fair value, which is usually the transaction price. In those cases where the initial fair value is based on a valuation model that uses inputs which are not observable in the market, the difference between the transaction price and the valuation model is not recognised immediately in the income statement but is amortised to the income statement until the inputs become observable, the transaction matures or is terminated.

At the time of initial recognition, IAS 39 requires all financial assets to be classified as either:
* Held at fair value through profit or loss (as a trading instrument or as designated by management), with realised and unrealised gains or losses reflected in profit or loss
* Available-for-sale at fair value, with unrealised gains and losses reflected in shareholders' equity and recycled to the income statement when the asset is sold or is impaired
* Held-to-maturity at amortised cost, where there is the intent and the ability to hold them to maturity
* Loans and receivables at amortised cost

At the time of initial recognition, IAS 39 requires all financial liabilities to be classified as either:
* Held at fair value through profit or loss (as a trading instrument or as designated by management), with realised and unrealised gains or losses reflected in profit or loss
* At amortised cost

A financial asset or financial liability, other than one held for trading, can be designated as being held at fair value through profit or loss if it meets the criteria set out below:
* The designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise from measuring assets or liabilities on a different basis
* A group of financial assets and/or liabilities is managed and its performance evaluated on a fair value basis
* Assets or liabilities include embedded derivatives and such derivatives are not recognised separately

The designation of a financial instrument as held at fair value through profit or loss is irrevocable in respect of the financial instruments to which it relates. Subsequent to initial recognition instruments cannot be classified into or out of this category.

Changes in the fair value of available-for-sale financial assets resulting from movements in foreign currency exchange rates are included in the income statement as exchange differences. Foreign currency exchange movements for available for sale equity securities is recognised in reserves.

Indian GAAP (AS 13 Investments)

AS 13 requires investments to be categorised as follows:
* Current investments, which are those readily realisable and intended to be held for less than one year, are carried at the lower of cost and fair value, with changes in fair value taken directly to profit or loss;
* Long term investments, which are those investments not classified as current, are carried at cost unless there is a permanent diminution in value, in which case a provision for diminution is required to be made by the entity

For investments, the Reserve Bank of India (RBI) outlines similar classifications to IFRS, but the classification criteria and measurement requirements differ from those set out in IFRS. Financial liabilities are usually carried at cost. There is no ability to designate instruments at fair value. AS 30 provides guidance on classification criteria and measurement requirements. However, this is not mandatory.

Derivatives

IFRS (IAS 39 Financial Instruments: Recognition and Measurement)

IAS 39 requires that all derivatives be recognised on balance sheet at fair value. Changes in the fair value of derivatives that are not hedges are reported in the income statement. Changes in the fair value of derivatives that are designated as hedges are either offset against the change in fair value of the hedged asset or liability through earnings or recognised directly in equity until the hedged item is recognised in earnings, depending on the nature of the hedge. The ineffective portion of the hedge's change in fair value is immediately recognised in earnings. A derivative may only be classified as a hedge if an entity meets stringent qualifying criteria in respect of documentation and hedge effectiveness. IAS 39 requires the separation of derivatives embedded in a financial instrument if it is not deemed to be closely related to the economic characteristics of the underlying host instrument.

Indian GAAP

Foreign exchange contracts held for trading or speculative purposes are carried at fair value, with gains and losses recognised in the income statement. In the absence of specific guidance, equity options are carried at the lower of cost or market value. There is no specific guidance on hedge accounting since Accounting Standard 30 is not mandatory. However, requirements of AS 30 with respect to hedge accounting are largely similar to that of IAS 39. For banks, there are guidelines prescribed by RBI on measurement and accounting of IRS and FRA entered onto for hedging purposes.

Impairment of financial assets

IFRS (IAS 39 Financial Instruments: Recognition and Measurement)

At each balance sheet date, an assessment is made as to whether there is any objective evidence of impairment. A financial asset is impaired and impairment losses are incurred if, and only if, there is objective evidence of impairment.

Assets held at amortised cost
If objective evidence of impairment exists, an assessment is made to determine what, if any, impairment loss should be recognised. The impairment loss is the difference between the asset's carrying amount and its estimated recoverable amount. The recoverable amount is determined based on the present value of expected future cash flows, discounted at the instrument's original effective interest rate, either individually or collectively. Individually assessed assets for which there is no objective evidence of impairment are collectively assessed for impairment.

Available-for-sale assets
If objective evidence of impairment exists, the cumulative loss (measured as the difference between the acquisition cost and the current fair value, less any previously recognised impairment) is removed from equity and recognised in the income statement. Market recoveries leading to a reversal of an impairment provision for available-for-sale debt securities are recognised in the income statement. Impairment losses for equity instruments classified as available-for-sale are not permitted to be reversed through profit or loss.

Indian GAAP (AS 13 Investments)

Long term investments are written down when there is a decline in fair value that is deemed to be other than temporary. Impairments may be reversed through the income statement in subsequent periods if the investment rises in value, or the reasons for the impairment no longer exist. In accordance with RBI regulations, in respect of available-for-sale (AFS) investments, impairments are required to be reversed through Investment Reserve Account (equity reserve) if the investment rises in value or the reasons for the impairment no longer exist. For loans and advances, the RBI regulations additionally require banks to hold provisions in respect of standard assets and for specific country risk exposures.# Derecognition of financial assets

IFRS (IAS 39 Financial Instruments: Recognition and Measurement)

A financial asset is derecognised if substantially all the risks and rewards of ownership have been transferred. If substantially all the risks and rewards have not been transferred, the asset will continue to be recognised to the extent of any continuing involvement.

Indian GAAP (RBI Guidelines on Securitisation of Standard Assets)

There is limited guidance on derecognition of financial assets. Securitised financial assets can only be derecognised if the originator has surrendered control over the assets. Control is not surrendered where the securitised assets are not beyond the reach of the creditors of the originator or where the transferee does not have the right to pledge, sell, transfer or exchange the securitised asset for its own benefit, or where there is an option that entitles the originator to repurchase the financial assets transferred under a securitisation transaction from the transferee.

Liabilities and equity

IFRS (IAS 39 Financial Instruments: Recognition and Measurement)

A financial instrument is classified as a liability where there is a contractual obligation to deliver either cash or another financial asset to the holder of that instrument, regardless of the manner in which the contractual obligation will be settled. Preference shares, which carry a mandatory coupon or are redeemable on a specific date or at the option of the shareholder are classified as financial liabilities and are presented in other borrowed funds. The dividends on these preference shares are recognised in the income statement as interest expense on an amortised cost basis using the effective interest method.

Indian GAAP

Classification is based on the legal form rather than substance.

Provisions for liabilities and charges

IFRS (IAS 37 Provisions, Contingent Liabilities and Contingent Assets)

The amount recognised as a provision is the best estimate at the balance sheet date of the expenditure required to settle the obligation, discounted using a pre-tax market discount rate if the effect is material.

Indian GAAP (AS 29 Provisions, Contingent Liabilities and Contingent Assets)

Provisions are recognised and measured on a similar basis to IFRS, except that there is no requirement for discounting the provision or liability.

Pension obligations

IFRS (IAS 19 Employee Benefits)

The discount rate to be used for determining defined benefit obligations is established by reference to market yields at the balance sheet date on high quality corporate bonds of a currency and term consistent with the currency and term of the post employment benefit obligations. Actuarial gains or losses are recognised in Other Comprehensive Income (retained earnings). Under the transitional provisions of IFRS 1 First time adoption of International Financial Reporting Standards and in accordance with IAS 19, the Group elected to record all actuarial gains and losses on the pension surplus or deficit in the year in which they occur within the consolidated statement of comprehensive income.

Indian GAAP (AS 15 Employee Benefits)

The discount rate to be used for determining defined benefit obligations is established by reference to market yields at the balance sheet date on government bonds. The expected return on plan assets is based on market expectation for the returns over the entire life of the related obligation. Actuarial gains or losses are recognised immediately in the statement of income.

Share based compensation

IFRS (IFRS 2 Share-based payments)

IFRS 2 Share-based payment requires that all share-based payments are accounted for using a fair value method. The fair value of the employee services received in exchange for the grant of the options is recognised as an expense. For equity-settled awards, the total amount to be expensed over the vesting period must be determined by reference to the fair value of the options granted (determined using an option pricing model), excluding the impact of any non-market vesting conditions (for example, profitability and growth targets). Non-market vesting conditions must be included in assumptions about the number of options that are expected to become exercisable. At each balance sheet date, the Group revises its estimates of the number of options that are expected to become exercisable. It recognises the impact of the revision of original estimates, if any, in the income statement, and a corresponding adjustment to equity over the remaining vesting period. The proceeds received net of any directly attributable transaction costs are credited to share capital (nominal value) and share premium when the options are exercised. Cash-settled awards must be revalued at each balance sheet date on an intrinsic value basis (being the difference between the market price of the share at the measurement date and the exercise price) with any changes in fair value charged or credited to staff costs in the income statement. Deferred tax is recognised based on the intrinsic value of the award and is recorded in the income statement if the tax deduction is less than or equal to the cumulative share-based compensation expense or equity if the tax deduction exceeds the cumulative expense.

Indian GAAP

Entities may either follow the intrinsic value method or the fair value method for determining the costs of benefits arising from share based compensation plans. Although the fair value approach is recommended, entities may use the intrinsic value method and provide fair value disclosures. Deferred tax is not recognised as it is not considered to represent a timing difference. Entities are also permitted the option of recognising the related compensation cost over the service period for the entire award (that is, over the service period of the last separately vesting portion of the award), provided that the amount of compensation cost recognised at any date at least equals the fair value of the vested portion of the award at that date.

Deferred Taxation

IFRS (IAS 12 Income Taxes)

Deferred tax is determined based on temporary differences, being the difference between the carrying amount and tax base of assets and liabilities, subject to certain exceptions. Deferred tax assets are recognised if it is probable (more likely than not) that sufficient future taxable profits will be available to utilise deferred tax assets.

Indian GAAP (AS 22 Accounting for Taxes on Income)

Deferred tax is determined based on timing differences, being the difference between accounting income and taxable income for a period that is capable of reversal in one or more subsequent periods. Deferred tax assets are recognised where it is probable that future taxable profit will be available against which the temporary differences can be utilised.

Interest income and expense

IFRS (IAS 18 Revenue)

Interest income and expense is recognised in the income statement using the effective interest method. The effective interest rate is the rate that discounts estimated future cash payments or receipts through the expected life of the financial instrument. When calculating the effective interest rate, the Group estimates cash flows considering all contractual terms of the financial instrument but does not consider future credit losses. The calculation includes all fees and points paid or received between parties to the contract that are an integral part of the effective interest rate, transaction costs and all other premiums or discounts.

Indian GAAP (AS 9 Revenue Recognition)

In the absence of a specific effective interest rate requirement, premiums and discounts are usually amortised on a straight line basis over the term of the instrument.

Dividends

IFRS (IAS 10 Events After The Reporting Date)

Dividends to holders of equity instruments, when proposed or declared after the balance sheet date, should not be recognised as a liability on the balance sheet date. A company however is required to disclose the amount of dividends that were proposed or declared after the balance sheet date but before the financial statements were authorised for issue.

Indian GAAP

Dividends are reflected in the financial statements of the year to which they relate even if proposed or approved after the year end.

Standard Chartered PLC - Glossary

Additional Tier 1 (AT1) Capital

Additional Tier 1 Capital consists of instruments issued by the bank and related share premium that meet the criteria for inclusion in Additional Tier 1 capital (and are not included in Common Equity Tier 1/(CET1), and regulatory adjustments required in the calculation of AT1 Capital.

Additional Value Adjustment

See Prudent valuation adjustment

Advanced Internal Rating Based (AIRB) approach

The AIRB approach under the Basel II framework is used to calculate credit risk capital based on the Group's own estimates of certain parameters.

Advances-to-deposits ratio

The ratio of total loans and advances to customers relative to total customer deposits. A low advances-to-deposits ratio demonstrates that customer deposits exceed customer loans resulting from emphasis placed on generating a high level of stable funding from customers.

ASEAN

Association of South East Asian Nations (ASEAN) which includes the Group's operation in Brunei, Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam.

Asset Backed Securities (ABS)

Securities that represent an interest in an underlying pool of referenced assets. The referenced pool can comprise any assets which attract a set of associated cash flows but are commonly pools of residential or commercial mortgages and in the case of Collateralised Debt Obligations (CDOs), the reference pool may be ABS.

Assets under management (AuM)

Total market value of assets managed by the Group on behalf of clients.# Glossary

Back-testing
A statistical technique used to monitor and assess the accuracy of a model and how that model would have performed had it been applied in the past.

Basel II
The capital adequacy framework issued by the Basel Committee on Banking Supervision (BCBS) in June 2006 in the form of the 'International Convergence of Capital Measurement and Capital Standards'.

Basel 2.5
In 2009 the European Commission proposed further changes to CRD III to address the lessons of the financial crisis. These changes reflected international developments and follow the agreements reached by the Basel Committee on Banking Supervision (BCBS). They included higher capital requirements for re-securitisations, upgrading disclosure standards for securitisation exposures and strengthening market risk capital requirements.

Basel III
In December 2010, the BCBS issued the Basel III rules text, which were updated in June 2011, and represents the details of strengthened global regulatory standards on bank capital adequacy and liquidity. Basel III was implemented in the UK on 1 January 2014. The new requirements will be phased in and fully implemented by 1 January 2019.

Basis point (bps)
One hundredth of a per cent (0.01 per cent); 100 basis points is 1 per cent. Used in quoting movements in interest rates or yields on securities.

BIPRU
The PRA's Prudential Sourcebook for Banks, Building Societies and Investment Firms.

Capital Adequacy Directive II (CAD II)
An amendment to Capital Adequacy Directive that gives national regulators the discretion to permit firms to use their own value at risk model for calculating capital requirements subject to certain criteria.

Capital Requirements Directive III (CRD III)
See Basel 2.5.

Capital Requirements Directive IV (CRD IV)
Represents the Capital Requirements Directive (CRD) and Capital Requirements Regulation (CRR) that implement the Basel III proposals in Europe.

Capital resources
Sum of Tier 1 and Tier 2 capital after regulatory adjustments.

Collateralised Debt Obligations (CDOs)
Securities issued by a third party which reference ABS and/or certain other related assets purchased by the issuer. CDOs may feature exposure to sub-prime mortgage assets through the underlying assets.

Collateralised Loan Obligation (CLO)
A security backed by the repayments from a pool of commercial loans. The payments may be made to different classes of owners (in tranches).

Collectively assessed loan impairment provisions
Also known as portfolio impairment provisions. Impairment assessment on a collective basis for homogeneous groups of loans that are not considered individually significant and to cover losses which have been incurred but have not yet been identified at the balance sheet date. Typically Retail clients are assessed on a portfolio basis.

Commercial Mortgage Backed Securities (CMBS)
Securities that represent interests in a pool of commercial mortgages. Investors in these securities have the right to cash received from future mortgage payments (interest and/or principal).

Commercial Paper (CP)
An unsecured promissory note issued to finance short term credit needs. It specifies the face amount paid to investors on the maturity date.

Standard Chartered PLC - Glossary continued

Commercial real estate
Includes office buildings, industrial property, medical centres, hotels, malls, retail stores, shopping centres, farm land, multifamily housing buildings, warehouses, garages, and industrial properties. Commercial real estate loans are those backed by a package of commercial real estate assets.

Common Equity Tier 1 (CET1) capital
Common Equity Tier 1 capital consists of the common shares issued by the bank and related share premium, retained earnings, accumulated other comprehensive income and other disclosed reserves, eligible non-controlling interests and regulatory adjustments required in the calculation of Common Equity Tier 1.

Constant currency
Constant currency change is derived by applying a simple translation of the previous period functional currency number in each entity using the current average and period end US dollar exchange rates to the income statement and balance sheet respectively.

Contractual maturity
Contractual maturity refers to the final payment date of a loan or other financial instrument, at which point all the remaining outstanding principal will be repaid and interest is due to be paid.

Core Tier 1 Capital
Core Tier 1 capital comprises called-up ordinary share capital and eligible reserves plus non-controlling interests, less goodwill and other intangible assets and deductions relating to excess expected losses over eligible provisions and securitisation positions as specified by the UK's PRA.

Core Tier 1 Capital ratio
Core Tier 1 capital as a percentage of risk weighted assets.

Cost to income ratio
Represents the proportion of total operating expenses to total operating income.

Counterparty credit risk
The risk that a counterparty will default before satisfying its obligations under a contract.

Country of credit responsibility
Total exposure to a client is aggregated to its parent's predominant risk location regardless of where the exposure is booked.

Country cross-border risk assets
Assets where the main source of repayment or security is derived from a country other than that in which the asset is booked.

Cover ratio
Represents the extent to which non-performing loans are covered by impairment allowances.

Covered bonds
Debt securities backed by a portfolio of mortgages that are segregated from the issuer's other assets solely for the benefit of the holders of the covered bonds.

Credit Conversion Factor (CCF)
Either prescribed by BIPRU or modelled by the bank, an estimate of the amount the Group expects a customer to have down further on a facility limit at the point of default.

Credit Default Swaps (CDSs)
A credit derivative is an arrangement whereby the credit risk of an asset (the reference asset) is transferred from the buyer to the seller of protection. A credit default swap is a contract where the protection seller receives premium or interest-related payments in return for contracting to make payments to the protection buyer upon a defined credit event. Credit events normally include bankruptcy, payment default on a reference asset or assets, or downgrades by a rating agency.

Credit institutions
An institution whose business is to receive deposits or other repayable funds from the public and to grant credits for its own account.

Credit risk mitigation (CRM)
Credit risk mitigation is a process to mitigate potential credit losses from any given account, customer or portfolio by using a range of tools such as collateral, netting agreements, credit insurance, credit derivatives and other guarantees.

Credit risk spread
The credit spread is the yield spread between securities with the same coupon rate and maturity structure but with different associated credit risks, with the yield spread rising as the credit rating worsens. It is the premium over the benchmark or risk-free rate required by the market to take on a lower credit quality.

Credit valuation adjustments (CVA)
An adjustment to fair value primarily in respect of derivative contracts that reflects the possibility that the counterparty may default such that the Group would not receive the full market value of the transactions.

Customer deposits
Money deposited by all individuals and companies which are not credit institutions including securities sold under Repo. Such funds are recorded as liabilities in the Group's balance sheet under Customer accounts.

Debt restructuring
This is when the terms and provisions of outstanding debt agreements are changed. This is often done in order to improve cash flow and the ability of the borrower to repay the debt. It can involve altering the repayment schedule as well as debt or interest charge reduction.

Debt securities
Debt securities are assets on the Group's balance sheet and represent certificates of indebtedness of credit institutions, public bodies or other undertakings excluding those issued by central banks.

Debt securities in issue
Debt securities in issue are transferrable certificates of indebtedness of the Group to the bearer of the certificate. These are liabilities of the Group and include certificates of deposits.

Delinquency
A debt or other financial obligation is considered to be in a state of delinquency when payments are overdue. Loans and advances are considered to be delinquent when consecutive payments are missed. Also known as 'Arrears'.

Deposits by banks
Deposits by banks comprise amounts owed to other domestic or foreign credit institutions by the Group including securities sold under Repo.

Dividend per share
Represents the entitlement of each shareholder in the share of the profits of the company. Calculated in the lowest unit of currency in which the shares are quoted.

Early alerts
An early alert is the process for proactive identification and management of counterparty exposures exhibiting signs of weakness of a material nature requiring monitoring, supervision or close attention by management.

Effective tax rate (ETR)
The tax on profits on ordinary activities as a percentage of profit on ordinary activities before taxation.

Expected loss (EL)
The Group's measure of anticipated loss for exposures captured under an internal ratings based credit risk approach for capital adequacy calculations. It is measured as the Group-modelled view of anticipated loss based on Probability of Default (PD), Loss Given Default (LGD) and Exposure at Default (EAD), with a one-year time horizon.

Exposure at default (EAD)
The estimation of the extent to which the Group may be exposed to a customer or counterparty in the event of, and at the time of, that counterparty's default. At default, the customer may not have drawn the loan fully or may already have repaid some of the principal, so that exposure is typically less than the approved loan limit.# Exposures

Credit exposures represent the amount lent to a customer, together with undrawn commitments.

External Credit Assessment Institutions (ECAIs)

For the Standardised Approach to credit risk for sovereigns, corporates and institutions, external ratings are used to assign risk-weights. These external ratings must come from PRA approved rating agencies, known as External Credit Assessment Institutions (ECAI); namely Moody's, Standard & Poor's and Fitch.

Eurozone

Represents the 17 European Union countries that have adopted the euro as their common currency. The 17 countries are Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Malta, Netherlands, Portugal, Slovakia, Slovenia and Spain.

Financial Conduct Authority (FCA)

The Financial Conduct Authority regulates the conduct of financial firms and, for certain firms, prudential standards in the UK. It has a strategic objective to ensure that the relevant markets function well.

Forbearance

Forbearance takes place when a concession is made to the contractual terms of a loan in response to an obligor's financial liabilities.

Foundation Internal Ratings Based Approach

A method of calculating credit risk capital requirements using internal PD models but with supervisory estimates of LGD and conversion factors for the calculation of EAD.

Free Deliveries

A transaction in which securities, foreign currencies or commodities have been paid for before receiving them or where securities, foreign currencies or commodities have been delivered before receiving payment for them.

Funded/unfunded exposures

Exposures where the notional amount of the transaction is funded or unfunded. Represents exposures where there is a commitment to provide future funding is made but funds have been released / not released.

General Prudential Sourcebook (GENPRU)

The PRA's General Prudential Sourcebook for Banks, Building Societies, Insurers and Investment Firms.

Global Systemically Important Institutions (G-SII)

The Financial Stability Board established in November 2011 a methodology to identify G-SIIs based on 12 principal indicators. Designation will result in the application of a CET1 buffer between 1% and 3.5%, to be phased in by 1 January 2019. The list of G-SIIs is re-assessed through annual re-scoring of banks and a triennial review of the methodology. National regulators have discretion to introduce higher charges than the minimum. In CRD IV this is implemented via the Global Systemically Important Institutions (G-SII) Buffer (see G-SII Buffer).

Global Systemically Important Institutions (G-SII) buffer

A capital buffer prescribed in the EU under CRD IV, to address risks in the financial sector as a whole, or one or more sub-sectors, to be deployed as necessary by each EU member state with a view to mitigate structural macro-prudential risk. In the UK this was transposed in January 2015 and is to be applied to ring-fenced banks and building societies over a certain threshold.

Guaranteed mortgages

Mortgages for which there is a guarantor to provide the lender a certain level of financial security in the event of default of the borrower.

High Quality Liquid Assets (HQLA)

Assets that are unencumbered, liquid in markets during a time of stress and, ideally, be central bank eligible. These include, for example, cash and claims on central governments and central banks. The Basel III rules require this ratio to be at least 100% and it's expected to apply from 2015.

Impaired loans

Loans where individual identified impairment provisions have been raised and also include loans which are collateralised or where indebtedness has already been written down to the expected realisable value. The impaired loan category may include loans, which, while impaired, are still performing.

Impairment allowances

Impairment allowances are a provision held on the balance sheet as a result of the raising of a charge against profit for the incurred loss. An impairment allowance may either be identified or unidentified and individual (specific) or collective (portfolio).

Individual liquidity guidance

Guidance given to the Group about the amount, quality and funding profile of liquidity resources that the PRA has asked the Group to maintain.

Individually assessed loan impairment provisions

Also known as specific impairment provisions. Impairment is measured individually for assets that are individually significant to the Group. Typically assets within the Corporate and Institutional client segment of the Group are assessed individually.

Innovative Tier 1 Capital

Innovative Tier 1 capital consists of instruments which incorporate certain features, the effect of which is to weaken (but only marginally) the key characteristics of Tier 1 capital (that is, fully subordinated, perpetual and non-cumulative). Innovative Tier 1 capital is subject to a limit of 15 per cent of total Tier 1 capital.

Internal Ratings Based (IRB) approach

The IRB approach is used to calculate risk weighted assets in accordance with the Basel Capital Accord where capital requirements are based on a firm's own estimates of certain parameters.

Internal Capital Adequacy Assessment Process (ICAAP)

A requirement on institutions under Pillar 2 of the Basel II framework to undertake a comprehensive assessment of their risks and to determine the appropriate amounts of capital to be held against these risks where other mitigants are not available.

Internal Model Approach (IMA)

The approach used to calculate market risk capital and RWA with an internal market risk model approved by the PRA under the terms of CRD IV/CRR. Formerly referred to as CAD II.

Interest rate risk (IRR)

Interest rate risk arises due to the investment of equity and reserves into rate-sensitive assets, as well as some tenor mismatches between debt issuance and placements.

Investment grade

A debt security, treasury bill or similar instrument with a credit rating measured by external agencies of AAA to BBB.

Jaws

The rate of income growth less the rate of expense growth, expressed as positive jaws when income growth exceeds expense growth (and vice versa for negative jaws).

Leveraged finance

Loans or other financing agreements provided to companies whose overall level of debt is high in relation to their cash flow (net debt: EBITDA (earnings before interest, tax, depreciation and amortisation)) typically arising from private equity sponsor led acquisitions of the businesses concerned.

Leverage ratio

A ratio introduced under CRD IV that compares Tier 1 capital to total exposures, including certain exposures held off balance sheet as adjusted by stipulated credit conversion factors. Intended to be a simple, non-risk based backstop measure.

Liquidity and credit enhancements

Credit enhancement facilities are used to enhance the creditworthiness of financial obligations and cover losses due to asset default. Two general types of credit enhancement are third-party loan guarantees and self-enhancement through over-collateralisation. Liquidity enhancement makes funds available if required, for other reasons than asset default, e.g. to ensure timely repayment of maturing commercial paper.

Liquid asset buffer

These assets include high quality government or central bank securities, certain deposits with central banks and securities issued by designated multilateral development banks to meet the PRA's requirement for liquidity.

Liquid asset ratio

Ratio of total liquid assets to total assets. Liquid assets comprise cash (less restricted balances), net interbank, treasury bills and debt securities less illiquid securities.

Liquidity cover ratio (LCR)

A short term liquidity measure that considers a 30 day period of liquidity stress

Loan-to-value ratio

The loan-to-value ratio is a mathematical calculation which expresses the amount of a first mortgage lien as a percentage of the total appraised value of real property. The loan-to-value ratio is used in determining the appropriate level of risk for the loan and therefore the correct price of the loan to the borrower.

Loans and advances

This represents lending made under bilateral agreements with customers entered into in the normal course of business and is based on the legal form of the instrument. An example of a loan product is a home loan.

Loans to banks

Amounts loaned to credit institutions including securities bought under Reverse repo.

Loans to individuals

Money loaned to individuals rather than institutions. The loans may be for car or home purchases, medical care, home repair, holidays, and other consumer uses.

Loans past due

Loans on which payments have been due for up to a maximum of 90 days including those on which partial payments are being made.

Loss given default (LGD)

LGD is the percentage of an exposure that a lender expects to lose in the event of obligor default.

Master netting agreement

An agreement between two counterparties that have multiple derivative contracts with each other that provides for the net settlement of all contracts through a single payment, in a single currency, in the event of default on, or termination of, any one contract.

Mezzanine capital

Financing that combines debt and equity characteristics. For example, a loan that also confers some profit participation to the lender.

Mortgage Backed Securities (MBS)

Securities that represent interests in a group of mortgages. Investors in these securities have the right to cash received from future mortgage payments (interest and/or principal).

Mortgage related assets

Assets which are referenced to underlying mortgages.

Medium term notes (MTNs)

Corporate notes continuously offered by a company to investors through a dealer. Investors can choose from differing maturities, ranging from nine months to 30 years.

Net asset value per share

Ratio of net assets (total assets less total liabilities) to the number of ordinary shares outstanding at the end of a reporting period.Net exposure
The aggregate of loans and advances to customers/loans and advances to banks after impairment provisions, restricted balances with central banks, derivatives (net of master netting agreements), investment debt and equity securities, and letters of credit and guarantees.

Net interest income
The difference between interest received on assets and interest paid on liabilities.

Net interest margin
The margin is expressed as net interest income divided by average interest earning assets.

Net interest yield
Interest income divided by average interest earning assets less interest expense divided by average interest bearing liabilities.

Net Stable Funding Ratio (NSFR)
The ratio of available stable funding to required stable funding over a one year time horizon, assuming a stressed scenario. It is a longer term liquidity measure designed to restrain the amount of wholesale borrowing and encourage stable funding over a one year time horizon

Non-performing loans
A non-performing loan is any loan that is more than 90 days past due or is otherwise individually impaired, other than a loan which is:
- renegotiated before 90 days past due, and on which no default in interest payments or loss of principal is expected; or
- renegotiated at or after 90 days past due, but on which there has been no default in interest or principal payments for more than 180 days since renegotiation, and against which no loss of principal is expected.

Normalised earnings
Profit attributable to ordinary shareholders adjusted for profits or losses of a capital nature; amounts consequent to investment transactions driven by strategic intent; and other infrequent and/or exceptional transactions that are significant or material in the context of the Group's normal business earnings for the period.

Over the counter (OTC) derivatives
A bilateral transaction (e.g. derivatives) that is not exchange traded and that is valued using valuation models.

Personal Debt Rehabilitation Scheme (PDRS)
Given the high household debt in Korea, the government encourages consumers to de-leverage debt through PDRS as an alternative to bankruptcy. Under PDRS, the debtor is required to pay down unsecured debts (principal only) over a maximum period of five years. Debtors are automatically discharged from the programme once they have successfully fulfilled their obligations during the five years and the residual outstanding unsecured debts are forgiven and written off by lenders. Upon receipt of PDRS applications, creditors are prohibited from further dunning activities.

Pillar 1
The first Pillar of the three pillars of Basel II/Basel III which provides the approach to calculation of the minimum capital requirements for credit, market and operational risk.

Pillar 2
Pillar 2 requires banks to undertake a comprehensive assessment of their risks and to determine the appropriate amounts of capital to be held against these risks where other suitable mitigants are not available.

Pillar 3
Pillar 3 aims to provide a consistent and comprehensive disclosure framework that enhances comparability between banks and further promotes improvements in risk practices.

Pre-provision profit
Operating profit before impairment losses and taxation.

Private equity investments
Equity securities in operating companies generally not quoted on a public exchange. Investment in private equity often involves the investment of capital in private companies. Capital for private equity investment is raised by retail or institutional investors and used to fund investment strategies such as leveraged buyouts, venture capital, growth capital, distressed investments and mezzanine capital.

Probability of default (PD)
PD is an internal estimate for each borrower grade of the likelihood that an obligor will default on an obligation.

Profit attributable to ordinary shareholders
Profit for the year after non-controlling interests and dividends declared in respect of preference shares classified as equity.

Prudent Valuation Adjustment (PVA)
A deduction from common equity tier 1 capital, to reflect the difference between fair value and prudent value positions, where the application of prudent results in a lower absolute carrying value than recognised in the financial statements.

Renegotiated loans
Loans and advances are generally renegotiated either as part of an ongoing customer relationship or in response to an adverse change in the circumstances of the borrower. In the latter case renegotiation can result in an extension of the due date of payment or repayment plans under which the Group offers a concessionary rate of interest to genuinely distressed borrowers. Such assets will be individually impaired where the renegotiated payments of interest and principal will not recover the original carrying amount of the asset and are defined as forborne loans. In other cases, renegotiation may lead to a new agreement, which would be treated as a new loan.

Repo/Reverse repo
A repurchase agreement or repo is a short term funding agreements which allow a borrower to sell a financial asset, such as ABS or Government bonds as collateral for cash. As part of the agreement the borrower agrees to repurchase the security at some later date, usually less than 30 days, repaying the proceeds of the loan. For the party on the other end of the transaction (buying the security and agreeing to sell in the future) it is a reverse repurchase agreement or reverse repo.

Residential mortgage
A loan to purchase a residential property which is then used as collateral to guarantee repayment of the loan. The borrower gives the lender a lien against the property, and the lender can foreclose on the property if the borrower does not repay the loan per the agreed terms. Also known as a Home loan.

Residential Mortgage Backed Securities (RMBS)
Securities that represent interests in a group of residential mortgages. Investors in these securities have the right to cash received from future mortgage payments (interest and/or principal).

Return on equity
Represents the ratio of the current year's profit available for distribution to ordinary shareholders to the weighted average ordinary shareholders equity for the reporting period.

Return on risk weighted assets
Operating profit (excluding civil monetary penalty, goodwill impairment and own credit) divided by average total risk weighted assets.

Risk weighted assets
A measure of a bank's assets adjusted for their associated risks. Risk weightings are established in accordance with the Basel Capital Accord as implemented by the FCA.

Risks-not-in-VaR (RNIV)
A framework for identifying and quantifying marginal types of market risk that are not captured in the Value at Risk (VaR) measure for any reason, such as being a far-tail risk or the necessary historical market data not being available.

Seasoning
The emergence of credit loss patterns in portfolio over time.

Secured (fully and partially)
A secured loan is a loan in which the borrower pledges an asset as collateral for a loan which, in the event that the borrower defaults, the Group is able to take possession of. All secured loans are considered fully secured if the fair value of the collateral is equal to or greater than the loan at the time of origination. All other secured loans are considered to be partly secured.

Securitisation
Securitisation is a process by which debt instruments are aggregated into a pool, which is used to back new securities. A company sells assets to a structured entity who then issues securities backed by the assets based on their value. This allows the credit quality of the assets to be separated from the credit rating of the original company and transfers risk to external investors.

Senior debt
Senior debt, frequently issued in the form of senior notes, is debt that takes priority over other unsecured or otherwise more "junior" debt owed by the issuer. Senior debt has greater seniority in the issuer's capital structure after subordinated debt. In the event the issuer goes bankrupt, senior debt theoretically must be repaid before other creditors receive any payment.

Sovereign exposures
Exposures to central governments and central government departments, central banks and entities owned or guaranteed by the aforementioned. Sovereign exposures as defined by the European Banking Authority includes only exposures to central governments.

Standardised approach
In relation to credit risk, a method for calculating credit risk capital requirements using External Credit Assessment Institutions (ECAI) ratings and supervisory risk weights. In relation to operational risk, a method of calculating the operational capital requirement by the application of a supervisory defined percentage charge to the gross income of eight specified business lines.

Stressed value at risk
A regulatory market risk measure based on potential market movements for a continuous one-year period of stress for a trading portfolio.

Structured finance /notes
A structured note is an investment tool which pays a return linked to the value or level of a specified asset or index and sometimes offers capital protection if the value declines. Structured notes can be linked to equities, interest rates, funds, commodities and foreign currency.

Sub-prime
Sub-prime is defined as loans to borrowers typically having weakened credit histories that include payment delinquencies and potentially more severe problems such as court judgements and bankruptcies. They may also display reduced repayment capacity as measured by credit scores, high debt-to-income ratios, or other criteria indicating heightened risk of default.

Subordinated liabilities
Liabilities which, in the event of insolvency or liquidation of the issuer, are subordinated to the claims of depositors and other creditors of the issuer.# Standard Chartered PLC - Financial Calendar

Results and dividend announced 5 August 2015
Ex-dividend date Hong Kong 12 August 2015
Ex-dividend date United Kingdom 13 August 2015
Record date for dividend 14 August 2015
Interim ordinary share dividend date 19 October 2015

Copies of this statement are available from:
Investor Relations, Standard Chartered PLC, 1 Basinghall Avenue, London, EC2V 5DD or on our website at http://investors.sc.com

For further information please contact:
Steve Atkinson, Group Head, Corporate Affairs +44 20 7885 7245
James Hopkinson, Global Head, Investor Relations +44 20 7885 7151
Edwin Hui, Head of Investor Relations, Asia +852 2820 3050
Uttam Hazarika, Manager, Investor Relations, India +91 22 61158643
Jon Tracey, Global Head, External Communications +44 20 7885 7613

The following information for the Half Year 2015 Results will be available on our website:
* The Video interviews with Bill Winters, Group Chief Executive and Andy Halford, Group Chief Financial Officer
* The Analyst presentation in pdf format
* The Webcast of the live analyst presentation in London with Q&A
* A Podcast of analyst presentation

Images of our Board of directors and senior management are available for the media at http://www.sc.com/en/about-us/our-people/index.html

Information regarding the Group's commitment to Sustainability is available at http://www.sc.com/sustainability

Standard Chartered PLC - Forward looking statement and basis of preparation

Forward-looking statements

It is possible that this document could or may contain forward-looking statements that are based on current expectations or beliefs, as well as assumptions about future events. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements often use words such as anticipate, target, expect, estimate, intend, plan, goal, believe, will, may, should, would, could or other words of similar meaning.

Undue reliance should not be placed on any such statements because, by their very nature, they are subject to known and unknown risks and uncertainties and can be affected by other factors that could cause actual results, and the Group's plans and objectives, to differ materially from those expressed or implied in the forward-looking statements.

There are several factors which could cause actual results to differ materially from those expressed or implied in forward looking statements. Among the factors that could cause actual results to differ materially from those described in the forward looking statements are changes in the global, political, economic, business, competitive, market and regulatory forces, future exchange and interest rates, changes in tax rates, future business combinations or dispositions and other factors specific to the Group.

Any forward-looking statement contained in this document is based on past or current trends and/or activities of the Group and should not be taken as a representation that such trends or activities will continue in the future. The Group undertakes no obligation to revise or update any forward looking statement contained within this document, regardless of whether those statements are affected as a result of new information, future events or otherwise.

The information, statements and opinions contained in this document do not constitute a public offer under any applicable legislation or an offer or solicitation of any securities, or any advice or recommendation with respect to any securities, in any jurisdiction.

Geographic presentation of results

The Group operates a number of central booking locations, primarily in the ASEAN and Europe regions. Lending financially booked in these locations may not correspond to the location of the customers or to the country of credit responsibility (as defined on page 31). We have used the following bases for disclosures across this report:

Within the geographic disclosures in note 2 to the Financial statements (pages 77 to 81), Loans and Advances to Customers are reported based on the location of the customer
Within the geographic disclosures in the "Risk profile" section (pages 37 to 48) and the 'Capital" section (page 64) of the "Risk and Capital review", Loans and Advances to Customers and Risk Weighted Assets are reported based on the financial booking location

Standard Chartered PLC - Index Page

Page		Page
104	Additional Tier 1 securities	39	Industry concentration in loans and advances
89	Assets at fair value through profit or loss	89	Investment securities
96	Asset backed securities	91	Liabilities at fair value through profit or loss
70	Balance sheet	55	Liquidity risk
59	Behavioural maturity analysis of assets and liabilities	47	Loan impairment coverage ratio
61	Capital base and ratios	66	Leverage ratio
72	Cash and cash equivalents	37	Loans portfolio analysis
72	Cash flow statement	53	Market risk
105	Contingent liabilities and commitments	59	Operational risk
37	Credit risk	101	Other assets
82	Customer accounts	85	Other impairment
82	Debt securities in issue	102	Other liabilities
82	Deposits by banks	83	Other operating income
84	Depreciation and amortisation		Performance highlights
100	Derivatives	35	Principal uncertainties
86	Dividends	63	Risk weighted assets
87	Earnings per share	30	Risk overview
34	Europe		Segmental and entity-wide information:
	Financial instruments:	75	· By client segments
89	· Classification	77	· By geography
91	· Valuation hierarchy	77	· Net interest margin and yield
99	· Instruments carried at amortised cost	82	· By structure of deposits
129	Glossary	104	Share capital
101	Goodwill and intangible assets	105	Shares held by share scheme trust
29	Group summary consolidated balance sheet	71	Statement of changes in equity
100	Hedging	69	Statement of comprehensive income
68	Income statement	102	Subordinated liabilities
11	Impairment	3	Summary of results
118	Indian Listing additional information:	85	Taxation
123	· Condensed financial statements in Indian Rupees	83	Trading income
	· Significant differences between Indian GAAP and IFRS		Group Chief Financial Officer's review

This information is provided by RNS
The company news service from the London Stock Exchange
END
IR UGUGGRUPAUMA

Definitions

Tangible net asset value per share: Ratio of parent shareholders' equity less preference shares classified as equity and goodwill and intangible assets to the number of ordinary shares outstanding at the end of the reporting period.
Tier 1 capital: Tier 1 capital comprises Core Tier 1 capital plus innovative Tier 1 securities and preference shares and tax on excess expected losses less material holdings in credit or financial institutions.
Tier 1 capital ratio: Tier 1 capital as a percentage of risk weighted assets.
Tier 2 capital: Tier 2 capital comprises qualifying subordinated liabilities, allowable portfolio impairment provision and unrealised gains in the eligible revaluation reserves arising from the fair valuation of equity instruments held as available-for-sale.
Total Loss Absorbing Capacity (TLAC): A proposal by the Financial Stability Board and not yet finalised for global systemically important institutions to have a sufficient amount of specific types of liabilities which can be used to absorb losses and recapitalise a bank in resolution. These proposals are intended to facilitate an orderly resolution that minimises any impact on financial stability, ensures the continuity of critical functions, and avoids exposing taxpayers to loss.
UK bank levy: A levy that applies to certain UK banks and the UK operations of foreign banks from 1 January 2011. The levy is payable each year based on a percentage of the chargeable liabilities of the Group as at 31 December.
Value at Risk (VaR): Value at Risk is an estimate of the potential loss which might arise from market movements under normal market conditions, if the current positions were to be held unchanged for one business day, measured to a confidence level of 97.5 per cent.
Working profit: Operating profit before impairment losses and taxation.
Write downs: After an advance has been identified as impaired and is subject to an impairment allowance, the stage may be reached whereby it is concluded that there is no realistic prospect of further recovery. Write downs will occur when and to the extent that, the whole or part of a debt is considered irrecoverable.

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Standard Chartered PLC — Interim / Quarterly Report 2015

4648_ir_2015-08-05_0ce4e1b2-fb6b-47e9-a211-a057e3f1bfbe.html

National Storage Mechanism

Standard Chartered PLC

Condensed consolidated interim income statement

Standard Chartered PLC

Condensed consolidated interim statement of comprehensive income

Standard Chartered PLC

Condensed consolidated interim balance sheet

Standard Chartered PLC

Condensed consolidated interim statement of changes in equity

Standard Chartered PLC

Condensed consolidated interim cash flow statement

1. Accounting Policies

(a) Statement of compliance

(b) Basis of preparation

1. Accounting Policies continued

2. Segmental Information

Performance by Client Segments

Performance by Client Segments continued

Performance by geographic regions and key countries

Entity-wide information

Entity-wide information continued

Performance by geographic regions and key countries continued

Entity-wide information 6 months ended 31.12.14

2. Segmental Information continued

Performance by geographic regions and key countries continued

Entity-wide information 6 months ended 30.06.15

2. Segmental Information continued

Performance profit by geographic regions and key countries continued

Entity-wide information 6 months ended 30.06.14

6 months ended 31.12.14

2. Segmental Information continued

Deposits structure by geographic regions

30.06.15

31.12.14

4. Other operating income

5. Operating expenses

Staff costs

Premises and equipment expenses

General administrative expenses

6. Depreciation and amortisation

7. Impairment losses on loans and advances and other credit risk provisions

8. Other impairment

9. Taxation

10. Dividends

Ordinary equity shares

2015 recommended interim dividend

Preference shares

6 months ended 30.06.15

6 months ended 30.06.14

6 months ended 31.12.14

11. Earnings per ordinary share continued

12. Financial instruments

Classification

12. Financial instruments continued

12. Financial instruments continued

Fair value adjustments

Level 3 movement tables - Financial assets

Level 3 movement tables - Financial liabilities

Credit Spreads

Recovery rates

Comparable Price/Yield

Discount margin

Correlation

Volatility

Interest rate curves

EV/EBITDA ratio multiples

P/E multiples

Liquidity discounts in the valuation of unlisted investments

Sensitivities in respect of the fair values of level 3 assets and liabilities

12. Financial instruments continued

Valuation of financial instruments measured at amortised cost on a recurring basis

13. Derivative financial instruments

Foreign exchange derivative contracts:

Interest rate derivative contracts:

Credit derivative contracts

Equity and stock index options

Commodity derivative contracts

Standard Chartered PLC Interim / Quarterly Report 2015