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<\/a><\/p>\nBy Yousef Saba<\/p>\n
DUBAI (Reuters) – Standard Chartered Chief Executive Bill Winters said on Monday he sees a big recession in the United States as unlikely, although a period of negative growth was possible.<\/p>\n
“I think it’s less the question of a massive decline in the U.S. – I think that’s very, very unlikely,” Winters said at conference in Dubai, adding the economy was “extremely strong”.<\/p>\n
“But it’s also got a high inflation problem and interest rates that are either going to stay high or maybe even go higher at some point … until the economy slows down. Now does that lead us into a big recession? I think unlikely. Could we have a period of negative growth? Yes.”<\/p>\n
He said Standard Chartered’s credit committee is “not tighter at all” after the collapse of three regional U.S. banks.<\/p>\n
“We were a net receiver of deposits during this period of global angst and we’ve got a super strong capital position and a very strong liquidity position,” he said, although the bank needs to keep an eye on how regulation changes.<\/p>\n
Central banks need “to make sure that solvent banks – otherwise healthy banks – have access to liquidity,” Winters said adding that the U.S. Federal Reserve did not do a good job “in the eye in the storm”.<\/p>\n
The “reactive response in the U.S. was perfect,” effectively stemming the crisis, he said, adding the ideal would have been to provide liquidity to “challenged banks” ahead of time.<\/p>\n
“Now they may still end up taking the bank into the FDIC, writing off the equity, imposing losses on the AT1 securities … that may still have happened, but in a more orderly way that wouldn’t have undermined confidence in the broader system.”<\/p>\n
“I’m not concerned about the problems in the banking sector in the U.S. or Switzerland – which is where they’ve been so far – I’m not really concerned about it spilling over into global economic activity,” he said, adding he was “very optimistic about the Gulf.”<\/p>\n
First Abu Dhabi Bank, the UAE’s biggest lender, earlier this year had considered a bid to take over Standard Chartered, but later said it was no longer doing so.<\/p>\n
Asked if Standard Chartered’s biggest shareholder would stick by it if another Gulf lender “came after” it, Winters said: “We have all the capacity and resources we need to keep on growing and keep on living an independent life.”<\/p>\n
“If somebody wants to come in and talk to us about how they can make us better … yeah, be my guest, we can always have a conversation. We have that responsibility to our shareholders. But I’m very, very confident that we can deliver this package all by ourselves,” he added.<\/p>\n
On interest rates, Winters said “I don’t know” when asked about the worst-case scenario, but added that his bank was focused on 5.25% “for now and for a while.” <\/p>\n
\n(Reporting by Yousef Saba; additional reporting by Tala Ramadan; Editing by Louise Heavens and Alexander Smith)<\/p>\n
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