Standard Chartered Plc posted record first-quarter earnings that surged past analyst estimates, as record wealth inflows offset precautionary charges linked to escalating tensions in the Middle East.

The London-headquartered lender reported a pretax profit of $2.5 billion for the first three months of 2026, significantly higher than the $2.09 billion Bloomberg-compiled consensus estimate.

The outperformance was fueled by double-digit growth in its Wealth Solutions and Global Banking divisions, helped by a record $18 billion of net new money into its wealth management business.

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“Despite ongoing geopolitical tensions and global economic uncertainty, our advantaged market presence and disciplined risk management give us confidence in our ability to perform,” Chief Executive Officer Bill Winters said in a statement on Thursday.

Standard Chartered’s latest earnings report comes as the lender’s “Fit for Growth” program draws to a close this year. Involving hundreds of initiatives, it targeted savings ranging from a few hundred thousand to tens of millions of dollars.

Investors are now looking toward next month, when Standard Chartered is scheduled to unveil a fresh set of medium-term financial targets at an event. The bank’s shares rose as much as 4.2 percent in Hong Kong afternoon trading.

While the bank largely shrugged off the broader macroeconomic chill, it was not entirely immune to the volatility in the Gulf. Standard Chartered booked a credit impairment charge of $296 million, which included $190 million in “precautionary management overlays” specifically tied to the Middle East conflict.

While it saw “no material impact” from the conflict, there were overlays for the petrochemical sector and potential sovereign downgrades. The bank’s Middle East portfolio is 6 percent of the group’s total exposure.

Flat trading

The hostilities in the Gulf, which choked off oil flows, set off wild swings in energy prices and upended interest-rate expectations, have had varying impact on bank earnings this season.

On Wall Street, Goldman Sachs Group Inc’s equities traders rode the volatility to a banner quarter while their peers in fixed-income, currency and commodities posted a surprise drop in revenue. JPMorgan Chase & Co traders notched their highest-ever quarterly revenue, with both equities and FICC beating estimates.

StanChart’s global markets business was broadly flat from a year earlier, while there was “strong client activity” in emerging market rates and currency products. 

The lender had a robust first quarter, with a “stand-out” performance in wealth, though it missed on credit due to the precautionary overlay, Joseph Dickerson and Priya Rathod, analysts at Jefferies, said in a note. They rate the shares a buy.

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Winters, whose 11th year anniversary as CEO is coming up soon, has overseen a restructuring of the business that saw it raise billions of dollars from investors as it pared back risk and slashed jobs in the wake of a series of scandals.

After surging almost 120 percent between early April 2025 and early February this year, the share rally suffered a setback, first from the surprise departure of Chief Financial Officer Diego De Giorgi, and later from the outbreak of the conflict in the Middle East. They have largely recovered since then.

De Giorgi, who had previously held senior roles at Bank of America Corp and Goldman Sachs Group Inc, was seen as among the front-runners to replace Winters when he eventually leaves the bank and the architect of the “Fit for Growth” efficiency drive.