Foreign lender Standard Chartered Bank's Indian operations had once been the highest contributor to its overall profits. However, this time there has been a 39% dip in operating profit of the bank's Indian operations in the first half of this fiscal.

India now stands third in terms of contribution to profits for Standard Chartered Bank.

"Tough macro-economic environment, slippages of deals, higher provisions, increased competition and regulatory changes on the saving bank rate and derivatives have affected our business growth," said south Asia chief executive Neeraj Swaroop. "We haven't taken hit on any of the lending decisions that we made."

The net interest margin (NIM) of the bank dipped to 3.1% from 3.8% earlier.

"The compression in NIM started in the second half of 2010. Our outlook is that it will be in the 3-3.2% range for 2011," Swaroop said.

"We have made higher provisions as a prudent measure. At this point we are not seeing a rise in NPA. But the provision is in anticipation of potential rise in NPAs, given the soft environment going ahead," he added.