Standard Chartered reported pre-tax profit of $6.88 billion for 2012, an increase of 1 percent from a year earlier but below analyst expectations.
Analysts expected profits to rise 4 percent to $7 billion, according to the average forecast of 16 analysts polled by Reuters. The group reported impairment losses and other credit risk provisions of $1.2 billion.
It said it remained confident for the year ahead and said it had started 2013 well.
In a rare blip after a decade of buoyant growth and few problems, StandardChartered was last year hit by a U.S. fine for moving millions of dollars through the American banking system on behalf of customers in Iran and three other sanctioned countries.
The bank said that it would cut its bonus pool by 7 percent to $1.4 billion in 2012, after its $667 million fine from U.S. regulators.
Standard Chartered has also voiced concern about an "avalanche" of extra regulation, particularly stricter liquidity rules being imposed by its home U.K. regulator.
Britain is imposing tougher capital and liquidity rules and a tax on bank assets that could land Standard Chartered with a bill of more than $320 million this year, reviving speculation it could look to move its headquarters from London to Asia.
(Read More: StanChart CEO:Banking 'Attacked' From All Sides )
An EU plan to cap bonuses at no more than twice an employee's salary could also hamper the bank's pay structure. Standard Chartered has ridden Asia's rise through much of the last decade, allowing it to continue hiring and increasing earnings when much of the industry is shrinking.
(Watch Now: StanChart Nota Recovery Story: Analyst)