Standard Chartered consider US$4 billion capital raising
(30 October 2015 – United Kingdom) Standard Chartered has tabled the idea of raising US$4 billion (A$5.6 billion) as British regulators seek to raise capital requirements for lender with exposure to emerging markets, sources have told Bloomberg.
No decision has yet been made on whether to proceed with a share sale. The London-based lender may need as much as $8 billion to address a funding gap, according to people close to the discussion.
Standard Chartered CEO, Bill Winters is under mounting pressure to reverse the bank’s downturn in profits and share price, which was the catalyst for previous CEO, Peter Sands resigning.
With most of its revenue coming from Asia, economic instability, a slide in commodity prices and expectations of a slowing Chinese economy have greatly impacted the bank.
Although bank dividend have been cut to half, saving US$1 billion and Winters promising to reduce risk-weighted assets by as much as US$30 billion by 2016, industry experts predict that a capital shortfall of around US$10 billion will exist.