:00:15. > :00:19.News all the latest business news live from Singapore. Earnings
:00:20. > :00:22.report, we find out why Standard Chartered is expected to close its
:00:23. > :00:26.second straight drop in profits today. And making money from
:00:27. > :00:37.property ` CapitaLand's chief executive talks about the trends and
:00:38. > :00:48.the risks. Thank you for joining us for this edition of Asia Business
:00:49. > :00:52.Report. Eye and Rico Hizon. `` I am Rico Hizon. Standard Chartered is
:00:53. > :00:55.one of the UK's biggest lenders, but more than 75% of its earnings
:00:56. > :00:58.actually come from Asia. With its first half`results due later today,
:00:59. > :01:01.the bank's profits may fall compared to levels one year ago. There has
:01:02. > :01:03.been speculation both the chief executive and chairman are under
:01:04. > :01:07.pressure from some investors to stand down. We take a look at what
:01:08. > :01:09.is behind the bank's change in fortunes, starting in India.
:01:10. > :01:12.Standard Chartered is one of the country's oldest banks, having set
:01:13. > :01:17.up its branch in 1858. Things have come a long way from dealing in
:01:18. > :01:19.rubber, tea and oil. Today, it is the country's largest lender, with
:01:20. > :01:23.its focus on corporate banking and customers in a market that has been
:01:24. > :01:38.a huge source of profits for the bank. But a slump in the Indian
:01:39. > :01:40.rupee last year took its toll along with slowing growth and corporate
:01:41. > :01:43.investment remaining weak. India was once Standard Chartered's most
:01:44. > :01:46.profitable market globally but it is no longer so. Only perhaps if the
:01:47. > :01:48.new government can turn positive sentiment into real investments,
:01:49. > :02:00.both from India and abroad, could things look likely to pick up any
:02:01. > :02:03.time soon. Here in Hong Kong, the Standard Chartered Bank building
:02:04. > :02:06.stands tall in the heart of the main business district. It is a testament
:02:07. > :02:09.to its success in Asia, where it has seen ten straight years of profit
:02:10. > :02:12.growth. But that winning streak came to an end last year because of
:02:13. > :02:15.market volatility. Investors have begun taking their money out of
:02:16. > :02:21.relatively risky emerging markets in Asia and are putting it back in
:02:22. > :02:26.developed economies. That has forced Standard Chartered to rethink its
:02:27. > :02:30.strategy. It has had to sell some businesses in key markets such as
:02:31. > :02:33.Hong Kong and South Korea. What is more, analysts say that a slower
:02:34. > :02:43.economy and tighter rules in China could affect its bottom line in the
:02:44. > :02:46.coming months. Here in Singapore, Standard Chartered has already
:02:47. > :02:49.flagged a weaker performance. One of the problems is competition. More
:02:50. > :02:55.than 120 commercial banks operate on this island. There is another reason
:02:56. > :02:58.for Standard Chartered to pay attention to Singapore, because it
:02:59. > :03:02.is home to its biggest investor, the nation's sovereign wealth fund,
:03:03. > :03:05.Temasek, which has a big stake. At least publicly, Temasek is refusing
:03:06. > :03:08.to join the debate about the future of the bank's senior management but
:03:09. > :03:12.it is being vocal about corporate governance and wants to see more
:03:13. > :03:15.independent directors on the board. Periodically, there are rumours that
:03:16. > :03:19.the Temasek would like to sell its holding, but as many point out, 18%
:03:20. > :03:30.is a lot to swallow and there are no obvious buyers. Earlier, I asked
:03:31. > :03:34.about what investors wanted in Standard Chartered. Investors want
:03:35. > :03:36.to see credible leadership at the top of this organisation, whether
:03:37. > :03:51.that means a change or reinforcement. This is the first
:03:52. > :03:58.job. So job at number one `` job number one. In your view, should
:03:59. > :04:01.there be a change in leadership? Or should there be a reinforcement?
:04:02. > :04:04.Personally, I think it might be time for a more drastic change, however
:04:05. > :04:08.that is really up to the board and the shareholders. That is only part
:04:09. > :04:14.of the story. The real problem they have is competitiveness. Banking
:04:15. > :04:17.competition in Asia has changed in a way that will never return to how
:04:18. > :04:20.things were. The rise of strong national banks, banks like DVS in
:04:21. > :04:23.particular, which is a great example. They have been taking
:04:24. > :04:29.market share from both HSBC and Standard Chartered. I think this is
:04:30. > :04:37.another issue that has to be addressed. How can they rethink,
:04:38. > :04:46.then, their Asia strategy when 75% of their earnings come from region?
:04:47. > :04:51.Yes, it is really, really tough. The problem is the playing field is
:04:52. > :04:56.extremely level. All major banks have the same systems and quality
:04:57. > :05:02.and staff. How do they differentiate themselves? The problem is perhaps
:05:03. > :05:10.the life cycle for Colonial Banks is ebbing. In other business News,
:05:11. > :05:17.Apple and Samsung have agreed to withdraw all lawsuits from one
:05:18. > :05:20.another outside the US. Samsung said the agreement did not involve
:05:21. > :05:28.licensing arrangements. It also said the two companies would continue to
:05:29. > :05:35.pursue paid within America. `` pursue cases within America. A US
:05:36. > :05:37.security company says a Russian group has hacked 1.2 billion
:05:38. > :05:40.usernames and passwords from more than 500 million e`mail addresses.
:05:41. > :05:43.They security company says it is the largest data breach known to date,
:05:44. > :05:45.and that the information came from more than 420,000 websites,
:05:46. > :05:55.including virtually all industries across the world. Many people
:05:56. > :06:00.grumble about the chunk of their pay cheque going to the government. But
:06:01. > :06:05.a new UN report says taxpayers in emerging economies in this region
:06:06. > :06:08.might have to pay a lot more tax. The report says many Asian countries
:06:09. > :06:15.aren't collecting nearly enough to pay for their development goals. For
:06:16. > :06:20.more of this I spoke with the UN's economic and social commission
:06:21. > :06:21.the Asia`Pacific. Largely if you look out, broadly, the evidence
:06:22. > :06:22.the Asia`Pacific. Largely if you the Asia`Pacific, you will find as
:06:23. > :06:31.substantial and potential tax collection. It is
:06:32. > :06:39.on average about 5%. In some countries it is as high as 16%. This
:06:40. > :06:43.is largely because the tax base is very low. The individual income tax
:06:44. > :06:50.is not being paid, in some countries it is as low as 1% of the
:06:51. > :06:56.population, to at best about 3% of the population. So we need to
:06:57. > :07:02.broaden the tax base, we need tax administrative effort to enhance the
:07:03. > :07:06.collection through stopping the tax evasion and avoidance practices.
:07:07. > :07:11.There are some countries with low base tax regimes, others have high
:07:12. > :07:15.base tax regimes. But meeting halfway, shouldn't governments just
:07:16. > :07:22.improve the efficiencies of tax collection and enforce tax laws?
:07:23. > :07:26.Absolutely, that is paramount. And I am not advocating at all tax rate
:07:27. > :07:32.increases. I'm simply saying that we need to broaden the tax base by
:07:33. > :07:36.reducing exemptions and concessions. But also making
:07:37. > :07:45.have very strong tax records, which are publicly disclosed. And also
:07:46. > :07:53.enforcement to effective tax administrators' vigilance.
:07:54. > :07:55.South`east Asia's biggest property developer says that profits are up
:07:56. > :08:03.14%. CapitaLand's chief executive told us how he is trying to deal
:08:04. > :08:11.with the risk in those markets. That is despite weaker result in China.
:08:12. > :08:16.Our correspondent heard how they are trying to deal with the risks in
:08:17. > :08:19.those markets. If you look at both Singapore and China, in Singapore,
:08:20. > :08:22.we remain very confident in the medium to long`term that it will
:08:23. > :08:25.remain a hub in this part of the world. In the short`term, some of
:08:26. > :08:27.the restrictions and measures will have an impact on residential
:08:28. > :08:32.property prices as well as residential sales volume. Similarly,
:08:33. > :08:41.in China, there is still this underlying trend. It remains intact.
:08:42. > :08:44.I think urbanisation continues to take place. We are talking about
:08:45. > :08:48.significant numbers of people moving from the countryside into the
:08:49. > :08:52.cities. So that will generate a strong demand for housing. Chinese
:08:53. > :08:58.residential sales have fallen over 40% in the first six months of this
:08:59. > :09:04.year. So how are you trying to deal with these increased challenges for
:09:05. > :09:07.your business? I think there has been a lot of talk about China
:09:08. > :09:11.potentially slowing down from 7.5% growth to about 7% or possibly even
:09:12. > :09:15.6.5%. But if you look at it, at 7% or 6.5%, China is still the engine
:09:16. > :09:19.of growth in this part of the world. Is so if you put the two trends
:09:20. > :09:23.together, migration and high growth in China, I foresee this to be a
:09:24. > :09:33.very strong market for the next few years and CapitaLand is well
:09:34. > :09:37.positioned. I think we have been doing well in China for the last few
:09:38. > :09:47.years and we have a team of people on the ground that understands the
:09:48. > :09:49.local market. We know the macro`picture may sometimes not be
:09:50. > :09:52.as rosy but within that market, because the market is large, there
:09:53. > :09:55.will be specific pockets of opportunities that, because we are
:09:56. > :10:01.in the market, we will be able to take advantage of. That was the
:10:02. > :10:03.chief executive of Singapore's CapitaLand. Before we go, here is a
:10:04. > :10:11.quick look at the markets. CapitaLand. Before we go, here is a
:10:12. > :10:19.quick look at Asian stocks are mostly in negative territory. Over
:10:20. > :10:26.concerns regarding Russia and Ukraine. The Australian benchmark
:10:27. > :10:27.lost 17 points. Those are the market this power.
:10:28. > :10:34.lost 17 points. Those are the market this Thank you for investing your
:10:35. > :10:43.time with us. I Rico Hizon in Singapore. Goodbye for now `` I am
:10:44. > :10:46.Rico Hizon. I'm Mike Embley. The top stories this hour: The US Secretary
:10:47. > :10:49.of State John Kerry has urged Israel and the Palestinians to take
:10:50. > :10:51.advantage of the continuing truce in Gaza to move towards wider
:10:52. > :10:54.negotiations. An America army general has been shot dead by an
:10:55. > :10:57.Afghan soldier near Kabul. Harold Greene was the most senior US
:10:58. > :10:58.officer to be killed since the Vietnam