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51. Related party transactions

Directors and officers

Directors’ emoluments

Details of directors’ pay and benefits and interests in shares are disclosed in the Directors’ remuneration report.

IAS 24 Related party disclosures requires the following additional information for key management compensation. Key management comprises non-executive directors and members of the Group Management Committee, which includes all executive directors.

  2009
$million
2008
$million
Salaries, allowances and benefits in kind 16 20
Pension contributions 6 6
Bonuses paid or receivable 9 18
Share based payments 37 25
  68 69
Transactions with directors, officers and others

At 31 December 2009, the total amounts to be disclosed under the Companies Act 2006 (the Act) and the Listing Rules of the Hong Kong Stock Exchange Limited (HK Listing Rules) about loans to directors and officers were as follows:

  2009 2008
  Number $000 Number $000
Directors 1 13 2 635
Officers1 5 7,240 3 7,898
1
For this disclosure, the term ‘Officers’ means the members of the Group Management Committee, other than those who are directors of Standard Chartered PLC, and the Company Secretary.

Mr Sunil Mittal, who was an independent non-executive director of Standard Chartered PLC until 31 July 2009, is Chairman and Group CEO of the Bharti Enterprises Group. Due to his significant voting power in the Bharti Enterprises Group, it was a related party of Standard Chartered PLC until 31 July 2009. As at 31 July 2009, the Group had loans to the Bharti Enterprises Group of $59 million (31 December 2008: $137 million), guarantees of $35 million (31 December 2008: $39 million) and foreign exchange deals with a notional value of $102 million (31 December 2008: $103 million).

As at 31 December 2009, Standard Chartered Bank had created a charge over $31 million (2008: $24 million) of cash assets in favour of the independent trustees of its employer financial retirement benefit schemes.

Other than as disclosed in this Annual Report and Accounts, there were no other 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 HK Listing Rules.

Associates

The Group has amounts due from Merchant Solutions totalling $32 million at 31 December 2009 (2008: $nil million). Except as disclosed, the Group did not have any amounts due to or from associate investments.

Joint ventures

The Group has loans and advances to PT Bank Permata Tbk totalling $3 million at 31 December 2009 (2008: $5 million), and deposits of $16 million (2008: $16 million). The Group has loans and advances with STCI totalling $12 million (2008: $12 million). The Group has investments in subordinated debt issued by PT Bank Permata Tbk of $50 million (2008: $nil million).

Company

The Company has received $171 million (2008: $105 million) of interest income from Standard Chartered Bank. The Company issues debt externally and lends the proceeds to Group companies. At 31 December 2009, it had loans to and debt instruments issued by Standard Chartered Bank of $5,038 million (2008: $3,036 million), derivative financial assets of $291 million (2008: $nil million) and derivative financial liabilities of $25 million (2008: $26million) with Standard Chartered Bank, loans of $1,737 million (2008: $1,724 million) to Standard Chartered Holdings Limited, and loans of $27 million (2008: $1 million) to other subsidiaries.

In 2006, the Company licensed intellectual property rights related to the Company’s main brands to an indirect wholly owned subsidiary, Standard Chartered Strategic Brand Management Limited (SCSBM), the income from which is held on the Company’s balance sheet and released over the term of licence, which expires in 2015. Effective 1 January 2009, the Company agreed to pay a rebate of $144 million to SCSBM relating to the unamortised portion of the license in respect of the licensing rights for certain jurisdictions, which were withdrawn by the Company. At 31 December 2009, $109 million (2008: $271 million) has been included as deferred income in the Company balance sheet in relation to this licence. On 1 January 2009 the Company re-issued the rights to license these jurisdictions to Standard Chartered Bank for a nominal consideration.

The Company has an agreement with Standard Chartered Bank that in the event of Standard Chartered Bank defaulting on its debt coupon interest payments, where the terms of such debt requires it, the Company shall issue shares as settlement for non-payment of the coupon interest.

Annual Report and Accounts 2009