Monday January 04, 2010
Yiannis Mostrous opts for Standard Chartered (OTC: SCBFF) as his top pick; it was also his favorite last year and has since risen 110%. Here's the latest from Silk Road Investor.
"Standard Charter is an international bank focused on consumer and corporate banking and treasury activities. The stock also trades on the London exchange with the symbol, STAN.
"Though based in London, the bank gives exposure to emerging markets in Asia, the Middle East and Africa. Asia makes up 59% of the firm’s profits with Hong Kong as its biggest single concentration of customers.
"The economies in Asia are rebounding faster than those in the west, increasing competitor activity amongst international and local banks.
"The banks strategy is to continue to develop its consumer banking franchises while maximizing profitability in its historically strong wholesale operations.
"For the January-November period, the firm reached record income and pretax profit highs, driven by growth in the corporate banking business.
"Standard Chartered has a relatively low loan-to-deposit ratio of 75%, giving the bank the luxury of relying less on borrowed funds and more on its increasingly strong, less costly deposits for expansion.
"Valuations are attractive; share price per trailing earnings is 14.3, trading at 1.5 times tangible book value. The firm maintains a strong balance sheet and a healthy liquidity position."
