Hong Kong, London: Standard Chartered Plc chief executive officer Bill Winters announced plans to reduce costs and indicated he’ll restructure operations in markets including India and South Korea as part of a long-awaited plan to turn around the lender.
The bank, whose operations span Asia, Middle East and Africa, is aiming to cut $700 million (Dh2.57 billion) in costs as part of a new three-year plan that the emerging markets focused-lender hopes will soothe investor concerns over its lacklustre returns. Tuesday’s announcement didn’t say whether the cuts would come from reduced headcount.
Winters has been seeking to convince investors he can revive longer-term earnings growth and generate an acceptable level of profitability while cutting costs. He’s spent much of his tenure cleaning up the balance sheet and culture of the London-based firm, which had been saddled with bad loans.
Among the targets announced by the bank:
Earlier, Standard Chartered said underlying pretax profit in 2018 was $3.86 billion, compared with a $3.98 billion consensus forecast compiled by the bank. Full-year underlying operating income was $14.97 billion, said the bank, compared with forecasts of $15.02 billion.
The firm’s private banking unit reported an underlying pretax loss of $14 million in 2018, compared with a loss of $1 million in the previous year.
Standard Chartered plans to “eliminate residual drags on returns from low-returning markets,” including India, South Korea, the United Arab Emirates and Indonesia it said.
The lender said last week it’s taking a $900 million charge for the fourth-quarter to cover potential US and UK penalties, including a 102 million pound ($133 million) fine from the British financial regulator related to its financial crime controls. The US. Justice Department extended a long-running agreement with Standard Chartered over allegations that the bank illegally processed transactions on behalf of Iran, giving the lender another three months under an outside monitor in December.