Standard Chartered closed the banking results season yesterday with results that were better than expected and a confident pledge to keep growing.

The emerging markets specialist, which is now Britain's second-biggest bank by market capitalisation, predicted that it would ride out the economic downturn better than many of its competitors because of the territories in which it specialises.

Peter Sands, chief executive, said that he was confident that the bank's key Asian markets, while not immune to the financial crisis, would recover more quickly than those in Europe and the United States.

He said: “Asia is going through a sharp cyclical change due to collapse in demand from the West. I am not underestimating what is happening there and I don't want to be interpreted as underestimating the scale of challenges facing Asia, but it will be shorter and shallower than what you will see in the West. The degree of leverage just isn't there and both governments and corporates are in a good position from a balance sheet point of view.

“You should not assume that what happens in the West will be replicated in Asia - the whole deleveraging in the West is less pronounced in Asia. You would struggle to find an Asian bank that has collapsed or needed to be rescued. The long-term fundamental attractions of Asia remain the same - a young, growing middle class, rapid urbanisation, increasingly well-educated populations and so on.”

He was speaking as Standard Chartered reported a 19 per cent rise in full-year pre-tax profits to $4.8billion (£3.4billion), despite impairments due to bad debts ballooning from $761million to $1.32billion.

The results comfortably beat City forecasts and the shares rose by 43p, more than 7 per cent, to 630p.

Mr Sands said that after Standard Chartered's surprise $2.7 billion rights issue in November, the bank's balance sheet was in good shape.

Tier 1 capital, the main measure of how much capital a bank has on its balance sheet relative to the size of its loan book, stood at 7.6 per cent at the year-end, up from 6.6 per cent at the end of 2007.

Mr Sands also insisted that the bank, which has two thirds of its business in Asia, was doing more business and was well-placed to take advantage of American and European rivals retrenching.

He said: “We're sticking to our strategy, leading the way in Asia, Africa and the Middle East. We are open for business and alive to the opportunities arising from the turmoil.”

Mr Sands said that Standard Chartered, which bought American Express for $860million in February last year, would approach any possible acquisitions carefully.

He played down speculation that the bank might bid for ABN Amro's consumer banking assets in China, which were put up for sale by Royal Bank of Scotland last week.

There was no news on a chairman after the resignation in January of Mervyn Davies to become Minister for Trade Promotion and Investment. Mr Sands said: “All I can really say is that we have started the process.”

— Up to 250 Dresdner Kleinwort bankers are preparing legal action after Commerzbank, the German bank's new owner, reneged on bonus payments of up to £1million.

The bankers, who have hired two London law firms, argue that their bonuses were ringfenced as part of the €5billion takeover in September and should not be affected by subsequent losses or changes in ownership. The bank is a quarter-owned by the German Government after receiving an €18billion rescue package.

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