2 weeks Ago By The Straits Times
Standard Chartered vowed to return at least US$8 billion (S$10.6 billion) to investors by 2026, up from US$5 billion. LONDON - Standard Chartered vowed to return at least US$8 billion (S$10.
6 billion) to investors by 2026 as its quarterly profit more than doubled from a year ago despite falling global interest rates. The bank had previously vowed to return at least US$5 billion by 2026. StanChart, which earns most of its revenue in Asia, said pretax profit for the third quarter reached US$1.
72 billion, above the US$1.49 billion average of 17 analyst estimates compiled by the bank. The profit compared with US$633 million a year earlier, when StanChart took a nearly US$1 billion combined hit from its exposure to China’s real estate and banking sectors.
Rival HSBC reported a 10 per cent quarterly year-on-year profit increase on Oct 29, sending its shares to an at least six-year high as investors turned bullish on its outlook. “We have delivered a strong performance in the third quarter with profit before tax up 41 per cent, driven by a record quarter in Wealth Solutions and strong growth in our Global Markets business,” StanChart chief executive officer Bill Winters said in a statement. Helping the bank has been strong performances by several of its core businesses, such as wealth management, which has been boosted by net inflows of billions of dollars of new money, as well as financial markets and global banking.
The lender said it was upgrading its 2024 operating income guidance to grow toward 10 per cent, from above 7 per cent. Lending demand is starting to creep back up and chief financial officer Diego De Giorgi said at a recent Bank of America financial services conference that the lender could see “green shoots of demand,” though growth remained below the level he expected to see given the countries the company operates in. Like other major banks attempting to cope with the impact of falling rates, StanChart is in the midst of a cost-savings programme.
Known as Fit for Growth, it aims to save US$1.5 billion through more than 200 internal initiatives targeted at reducing expenses by as little as a few hundred thousands of dollars to tens of millions of dollars. Aimed at capping annual expenses at US$12 billion by 2026, the move is expected to accelerate next year as the bank begins to invest more in efforts to streamline its cost base.
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