StanChart endorses focus on Asia and other emerging mkts

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: Standard Chartered Plc, the third- largest bank in the United Kingdom by market value, wants to do business almost exclusively in Asia and emerging markets. Any executive of the lender who dares to depart from that strategy risks the wrath of Mike Rees, the chief executive officer for corporate banking.

“Mike will say, ‘I will bring up a cricket bat or baseball bat and hit you if you go off strategy,’” says Sean Wallace, Standard Chartered’s head of corporate finance.

Rees’s hard-nosed stand is endorsed by Standard Chartered CEO Peter Sands. “People know they get banged on the head if they go offbeat,” he says.

The reason for what Wallace calls the bank’s “maniacal” determination to stick to the Asia-based model is its history of false starts. Beginning in the 1970s, Standard Chartered went through a series of acquisitions and expansions that gave it branches and affiliates on every continent— and landed it in a sea of red ink in the 1980s. The bank also admitted to several ethical lapses in the 1990s and got hit with disciplinary actions in India and Hong Kong, two of its biggest markets.

“We had a lot of banana skins from our previous years,” says Rees who has been with the bank since 1990. “I’ve got the scars. The tragedy would be if I let those mistakes happen again.”

Standard Chartered hasn’t made many mistakes lately. In 2009, total return on its shares soared 79 percent as of November 3—the second-best performance of Britain’s top five banks after Barclays Plc, and four times the gain of its archrival, London- based HSBC Holdings Plc.

Total return in the 12 months through November 3 was 78.3%, compared with 9.5% for the FTSE All-Share Banks Index.

The bank didn’t entirely dodge the global financial upheaval; its stock fell 46% in 2008. Yet the bank’s profits were barely affected, rising 20% to a record $3.4 billion compared with 2007, on revenue that was up 26% to $14 billion.

Profits have quadrupled since 2002, when then-CEO Mervyn Davies made the decision to strengthen the bank’s position in emerging markets. Davies is now UK minister for trade and investment.