Standard Chartered reorganisation progresses
(6 December 2018 - Singapore) Standard Chartered is reportedly reducing headcount in key markets such as Singapore and Dubai as the lender seeks to more actively cap expenses.
Some senior roles are included in the cuts however the group’s strategy hasn’t yet been made public. The eliminations also include leadership at the firm’s priority banking operations which offer personalized wealth-management services. StanChart delivered a profit of $744 million in 2017 and promised to pay its first dividend since 2015 yet ROE stands at 3.5 percent - below the banks eight percent target. The bank generates a large part of its revenues and profits in emerging markets, mainly in Asia and Africa, where it has a strong network of branches to rely upon. It also has a partnership with Switzerland’s derivatives developer Leonteq, having signed an agreement for structured products.
StanChart CEO Bill Winters is tasked with sparking new earnings growth as the bank continues to review plans to simplify its structure, reduce funding expenses and free up liquidity. The London head quartered bank was designated a systemically important bank in Singapore earlier this year (D-SIB) and has previously been reported as planning to group together a number of Southeast and South Asian countries under a new Singapore subsidiary. The move could take effect as early as 2019.
A representative for StanChart said the company has made “substantial progress in executing the transformation plan laid out in 2015” and will disclose its strategy for improving returns at its full-year results in February 2019. The lender is expected to unveil a strategic review to address investor concerns about rising expenses and an approximate 40 percent decline in the share price since Bill Winters became CEO in June 2015. He stated in October that the bank was working on a three-year plan to improve performance. The bank has 86,000 employees at the end of June and the announced headcount reduction is expected to impact up to 100 positions although the number hasn’t been finalised.
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