Key Performance Indicators

Setting high standards


2007 has been another excellent year as we turbo-charged growth in income and profit, bolstered capital, increased return to our shareholders, enhanced service quality to customers and improved staff engagement. Our Key Performance Indicators reflect the substantial improvement we have made on several fronts.

Key performance indicators : Financial
  Financial      
  Normalised earnings
per share
Operating income Tier 1 capital ratio Normalised return on shareholders’ equity
Description This Key Performance Indicator (KPI) is calculated as profit attributable to ordinary shareholders of the Group as normalised for certain one-off or irregular items, divided by the weighted average of the number of shares in issue during the year. Operating income is calculated as the sum of the net interest income, net commission income, and net trading income. Tier 1 capital is measured by the ratio of Tier 1 capital to risk-weighted assets and contingents. Normalised return on shareholders’ equity is calculated as the normalised profit attributable to ordinary shareholders as a percentage of average shareholders' equity.
Aim To consistently deliver year-on-year growth in normalised earnings per share. To sustain organic momentum. To maintain Tier 1 capital ratio between 7 and 9 per cent. To deliver superior returns on shareholders' equity compared to the industry average.
Analysis During 2007, we had growth of 16 per cent, with strong contributions from both businesses. During 2007, operating income grew by 28 per cent compared with 2006, and underlying operating income increased by 23 per cent. During 2007, the Group maintained a strong Tier 1 capital ratio at 9.8 per cent, which increased from 8.3 per cent at the end of 2006. During 2007, normalised return on shareholders' equity, declined to 15.6 per cent, reflecting an increase in non-revenue reserves.
Source This measure is reported in the Group’s audited financial statements within note 13 in the Notes to the Accounts. This measure is reported in the Group’s audited financial statements. This measure is reported in the audited Capital section of the Risk Review of the Annual Report. This measure is derived from information within the Group’s audited financial statements, being normalised earnings (note 13) as a percentage of average shareholders' equity (excluding preference shares).
Trend Normalised EPS
197.6cents
2006: 170.7 cents
2005: 153.7 cents
2004: 124.6 cents
2003: 90.1 cents
Operating income
$11,067m
2006: $8,620m
2005: $6,861m
2004: $5,274m
2003: $4,740m
Tier 1 capital ratio
9.8%
2006: 8.3%
2005: 7.7%
2004: 8.6%
2003: 8.6%
Normalised return on ordinary shareholders’ equity
15.6%
2006: 16.9%
2005: 18.0%
2004: 18.6%
2003: 15.7%

Key performance indicators : Non–Financial
  Non-financial    
  Wholesale Banking
Service Quality Index
Consumer Banking
Loyal and Positive Index
Q12 ratio of engaged
to disengaged staff
Description This Index measures Wholesale Banking client satisfaction and engagement with Standard Chartered relative to the best competitor bank in each of the key markets where we operate. Client satisfaction studies are run annually and provide feedback on the Group and its main competitors across the Global Corporates, Local Corporates and other client segments. This indicator gauges customer satisfaction and loyalty to the products and services provided by Consumer Banking. Key satisfaction and recommendation measures are combined to provide an index of loyalty. These measures of reported customer satisfaction and loyalty are benchmarked against those reported for main competitors in each product and service within each market. Q12 ratio is based on the Group’s annual employee engagement survey. It assesses the proportion of engaged employees in the Group to each disengaged employee. High employee engagement has been shown to be strongly related to increased business performance, through both internal and external research.
Aim To deliver superior service to clients, demonstrably ahead of our main competitors in our key markets. To increase customer satisfaction with the products and services provided by Consumer Banking and to drive overall customer loyalty. To continue to foster a culture of high employee engagement as the Group continues to grow and change.
Analysis During 2007, we expanded client satisfaction measurement in Wholesale Banking so that it now covers more than half of client revenues. Despite this expansion in coverage our Service Quality Index remains strong, at 98 per cent compared with 97 per cent in 2006. We have seen steady growth over the last four years with a one percentage point increase thus far in 2007 results. Employee engagement continues to increase year-on-year, despite high growth, both organically and through acquisitions.
Source Third party client satisfaction studies conducted by reputable and accredited third party organisations. The 2007 index is derived from surveys managed by TNS, ClientKnowledge and Greenwich Associates. Market Probe Customer Satisfaction and Loyalty Survey (26 markets on average each year). The Gallup Organization, Q12 Employee Engagement Survey.
Trend Wholesale Banking
Service Quality Index

98%
2006: 97%*
2005: 93%#
2004: 99%
2003: 92%
Global (26 countries) – % of
Loyal and Positive customers

84%
2006: 83%
2005: 80%
2004: 74%
Q12 ratio of engaged
to disengaged staff

4.7:1
2006: 4.5:1
2005: 4.4:1
2004: 3.7:1
2003: 2.8:1
*
In 2006, the Wholesale Banking Service Quality Index was re-calibrated to include additional satisfaction surveys covering both Global Corporate clients and Local Corporates, reflecting a larger share of client revenues.
#
Index data for 2005 is based on a survey conducted in Asia by Greenwich Associates covering our Global Corporate clients only.