Standard Chartered (2888)

[Stephen]

Stanchart to exit equity derivatives, convertible bonds


  [url=http://www.straitstimes.com/business/banking/stanchart-to-exit-equity-derivatives-convertible-bonds#][/url]
Businesses to be phased out by end of Q1 next year as bank tries to reverse 2-year profit slide
HONG KONG • Standard Chartered said it was closing its equity derivatives and convertible bonds businesses as chief executive officer Bill Winters tries to turn around the lender's performance.
The bank will phase out the businesses, exiting from institutional cash equities, equity research and equity capital markets, it said in an e-mailed statement yesterday.
At least 10 jobs will go, according to a person with knowledge of the matter, who asked not to be identified because the details are private.

Standard Chartered CEO Bill Winters is trying to reverse a two-year profit slide at the bank. Shares of Stanchart, which generates most of its revenue in Asia, have fallen 24 per cent in Hong Kong this year after commodity prices slumped and China's economy cooled.

"With effect from today, we have commenced the wind-down of the equity derivatives and convertible bonds businesses in a phased manner," a spokesman said via e-mail. "We anticipate that most of the process will be completed by the end of the first quarter next year."
Mr Winters is trying to reverse a two-year profit slide at the emerging market-focused lender.
Standard Chartered, which generates most of its revenue in Asia, has seen its stock price fall 24 per cent in Hong Kong this year after commodity prices slumped and China's economy cooled.
"Regulators are pretty negative about commercial banks' trading activities, so this move probably helps improve capital ratios, reduces earnings volatility and cuts staff, so costs," Mr Jim Antos, an analyst at Mizuho Securities Asia in Hong Kong, told Bloomberg. "They are going back to basic banking."
Standard Chartered will continue to offer equity financing advice for corporate and institutional clients and will still offer securities trading for retail and private banking clients, a spokesman said by e-mail.
Getting out of equity derivatives and convertible bonds, businesses run mainly out of Hong Kong, is part of efforts to position the bank for growth and to "kick-start performance", the lender said in the statement. The bank remains "fully committed to Hong Kong", it said.
"We are taking action to position the bank for growth and driving a step change in performance," the spokesman said.
Global investment banks such as Goldman Sachs Group and Citigroup saw increases in their derivatives sales and trading income in Asia during the first half of this year. But the business is expected to fall off in the second half of the year due to the drop in China's stock market.
Sales of equity-linked securities in Japan and South Korea fell to a one-year low in September.
Since taking over in June, Mr Winters, 54, has eliminated 1,000 senior positions and cut the bank's dividend in half to save about US$1 billion (S$1.4 billion). Some analysts have forecast that a capital gap of between US$4 billion and US$10 billion will be revealed when the Bank of England releases its second round of stress tests on Dec 1.
Standard Chartered's board will meet as early as next month to discuss whether the bank needs to raise capital as it struggles under rising bad loans and an economic slowdown in Asia, the Wall Street Journal has reported, citing people familiar with the matter.
BLOOMBERG

Does anyone know what is the stock code for this 2888 in SCB online?

tried 2888.hk , 2888, 02888 ..all failed..

Is there are withholding tax for its dividends, does anyone know?

Thanks!

Noob..its 02888..

Whats the difference between the shares traded in London and HK?

Are they equivalent and have the same voting rights and entitlement?

[butcher]

same shares which entitles the shareholder the same rights
HK no WHT on dividend

[Stephen]

same shares which entitles the shareholder the same rights
HK no WHT on dividend

Thanks Butcher 

[greengiraffe]

• Nov 3 2015 at 5:00 PM 
  

Standard Chartered to raise $7.1b, cut 15,000 jobs

• Share via Email

NaN of
[img=620x0]http://www.afr.com/content/dam/images/1/2/l/w/6/2/image.related.afrArticleLead.620x350.gkpssh.png/1446530447155.jpg[/img]Standard Chartered has lost half its value in the past two years. Reuters
by Stephen Morris and Alfred Liu
Standard Chartered Plc said it will cut 15,000 jobs and raise £3.3 billion ($7.1 billion) in a rights issue as chief executive Bill Winters struggles to revive a lender that halved in value over the past two years.
The bank pledged a "cost rationalisation" of $US2.9 billion by 2018 and said it will restructure or exit $US100 billion of assets, in a statement on Tuesday. Standard Chartered's shares plunged as much as 6.2 per cent in Hong Kong after the announcements, extending this year's decline to 31 per cent.
The moves came as the London-based bank posted an unexpected quarterly loss and ahead of the publication next month of British regulators' bank stress tests. The bank, which generates most of its revenue in Asia, said it has been hurt by China's slowdown and slumping commodity prices.
"The business environment in our markets remains challenging and our recent performance is disappointing," Winters, 54, said in a statement.

The 15,000-job reduction, called part of a "simplified" structure, is on a gross basis. Besides strengthening the bank's balance sheet, the capital raising will help to fund a planned $US3 billion investment over three years into "strategic opportunities," technology and upgrading regulatory and compliance systems, the lender said.
TEMASEK CITED
The two-for-seven rights issue offered at 465 pence per share will boost the lender's common-equity Tier-1 capital ratio to 13.1 per cent from 11.5 per cent as of June 30, the bank said. Largest shareholder Temasek Holdings of Singapore intends to take up rights for 15.8 per cent of existing share capital, the bank said.
The pretax loss of $US139 million for the third quarter compared with a $US1.53 billion profit a year earlier, the bank said in a statement. The average of five analyst estimates compiled by Bloomberg was for a $US903 million profit.


A rights issue had been "only a matter of time," said Andrew Clarke, director of trading at Hong Kong brokerage Mirabaud Asia, adding that the lender had "far too many issues" that it still needed to resolve.
Standard Chartered said its targets now were for a 10 per cent return on equity and a common-equity Tier-1 capital ratio of 12 per cent to 13 per cent.
Impairment losses rose 129 per cent from a year earlier to $US1.23 billion, with the bank citing exposures to India and commodities. Raul Sinha, an analyst at JPMorgan Chase with an overweight rating on the stock, had forecast impairments at $US831 million, adding to $US1.7 billion of loan losses in the first half.
The bank's stock has declined 26 per cent in London this year.





Bloomberg

[butcher]

SCB now trading at around HK$48 looks very attractive ya.
Below its rights issue price at 465 pence (HK$55.60).
SCB is one of the biggest bank in HK also right?

[fundamentalman]

good thing is that they are reducing exposure to commodities and commodity producers ....

====

Standard Chartered Drops After First Annual Loss Since 1989

Stephen Morris sjhmorris

February 23, 2016 — 3:21 PM WIB Updated on February 23, 2016 — 7:42 PM WIB

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•Loan impairments almost double to $4 billion, highest ever


•CEO Winters says performance to remain `subdued' in 2016


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Bill Winters took more “painful” steps to turn around Standard Chartered Plc as the bank posted its first annual loss since 1989. The shares fell.

The Asia-focused lender reported a pretax loss of $1.5 billion in 2015, down from profit of $4.2 billion a year earlier, as revenue missed estimates and loan impairments almost doubled to the highest in the bank’s history. The company wrote down the value of its business in Thailand, said it was reviewing its operations in Indonesia, further cut its commodity exposure and eliminated all executives’ bonuses.



Bill Winters

Bill Winters

Photographer: Jason Alden/Bloomberg

“Our 2015 performance was poor, and in many ways unacceptable” with the drop in income “precipitous,” Winters, the company’s chief executive officer said on a call with reporters Tuesday. 2016 “will be another difficult year, no doubt.”

Winters, 54, is attempting to unwind the damage caused by predecessor Peter Sands’ revenue-led expansion across emerging markets, which left the bank riddled with bad loans when the commodity market crashed and growth stalled from China to India. The company set a target of a 10 percent return on equity by 2020, up from negative 0.4 percent in 2015.

Decent Business?

“The results were never going to be good, I’m afraid,” said Hugh Young, Asia managing director of Aberdeen Asset Management Plc, one of Standard Chartered’s largest shareholders. “The most important point is whether Bill and team are doing the right things and tidying up and whether there’s a decent business left at the end of it. I think the answer to both is in the affirmative.”

The stock dropped 2.5 percent to 425.45 pence at 12:35 p.m. in London, increasing the decline this year to 25 percent. The shares trimmed an earlier plunge which reached 12 percent shortly after the results were released.



“StanChart results are weak across lines” with “management prioritizing actions that support long-term turnaround at near-term cost,” said Raul Sinha, an analyst at JPMorgan Chase & Co. with an overweight rating on the stock. “Asset shrinkage and weakness in commodity prices” weighed on revenue.

‘Painful’ Steps

Revenue declined 15 percent to $15.4 billion, falling short of analysts’ estimates of $15.9 billion in a Bloomberg survey. Loan impairments jumped to $4 billion from $2.1 billion in 2014. When executives look at the 2015 results, it “rips at our souls,” Winters said on a call with analysts.

The bank took a $1.8 billion restructuring charge, part of the $3 billion in such charges it flagged in November. That included a writedown of about $1 billion of a portfolio it’s deemed too risky and seeking to sell in order to shed $20 billion of risk-weighted assets. Standard Chartered will “continue to take necessary, sometimes painful steps to improve returns,” the company said in a presentation to investors.

The bank is “in discussions” regarding its presence in Indonesia as the government changes regulations on foreign-owned lenders in the country, Winters said. The company recorded a $126 million goodwill impairment on its operations in Thailand, cut its exposure to China, and said it’s continuing to restructure Korea, where returns “remain challenging.” Regulatory costs climbed 40 percent to $1.01 billion.

Dividend Return

“We are dealing with our expense problem as aggressively as anyone in the industry,” Winters said on the call. The bank expects to restart paying a dividend this year after canceling the payout in the second half of 2015 to save money, Benjamin Hung, regional CEO for Greater China and North Asia, said at briefing with reporters in Hong Kong.

While the bank didn’t call out any major fines in its results, it might have to pay U.S. authorities a further $2 billion to settle regulatory probes into sanctions violations, according to Sanford C. Bernstein Ltd. analyst Chirantan Barua.

The bank reduced its exposure to commodities by 28 percent to $39.6 billion, and cut exposure to oil and gas producers, which have been suffering from a record slump in energy prices, by 26 percent to $9.6 billion.

Excluding some one-time items, pretax profit was $834 million. That fell short of the average estimate for profit of $1.37 billion from 20 analysts surveyed by Bloomberg. Standard Chartered said its common equity Tier 1 capital ratio, a measure of financial strength, fell to 12.6 percent from 13.1 percent as of Sept. 30.

Since June, Winters has raised $5.1 billion from investors, scrapped the dividend and announced plans to cut 15,000 jobs to help save $2.9 billion by 2018, while seeking to restructure or exit $100 billion of risky assets.

The CEO has been shrinking the lender’s balance sheet after rapid growth under Sands, who was replaced last year after eight years as CEO. Total assets at the lender, which focuses on Asia, the Middle East and Africa, ballooned to a peak of $726 billion at the end of 2014 from $266 billion in 2006, according to data compiled by Bloomberg. The bank had $640 billion of assets at the end of last year, a 12 percent decrease, the results show.

Former executives at the bank could have some of their bonuses “clawed back” in light of irresponsible lending decisions in the past, Winters said on the call with analysts.

“This is not a banking crisis,” Winters told reporters on a conference call. “We are going through a very difficult transition from a period with rapid loan growth with some big concentrated exposures, where we under-emphasized and under-invested in some of the things that drive our core franchise.”

(An earlier version of this story corrected the 2015 return figure.)

[butcher]

That seems to be good news for them.

[weijian]

Pretty damning skeletons found in the closet.


Standard Chartered Cracking Down on ‘Above the Law’ Bankers

Bill Winters found more than just bad loans when he took over Standard Chartered Plc. He says he uncovered a culture where a few senior managers flouted ethics rules for personal gain and considered themselves “above the law.”
The lender is cracking down after “recent transgressions” concerning some employees’ outside business interests, close financial dealings with co-workers and excessive expenses, according to a series of memos issued over the past two months that were seen by Bloomberg News. In an effort spearheaded by General Counsel David Fein, the British bank, which does almost all of its business in Asia and emerging markets, is also beefing up its internal investigation team with former detectives from the FBI, Scotland Yard, Hong Kong police and the New Zealand intelligence agency.

http://www.bloomberg.com/news/articles/2...aw-bankers

[soros]

The latest accounts for Standard Chartered year ending 31 Dec 2016 page 77 refers.

http://iis.aastocks.com/20170224/002731275-0.PDF

Profit before taxation = 409 Mil
Taxation = 600 Mil
Loss for year = (191) Mil

How can any tax be greater than the profit ?

[YMPL]

The latest accounts for Standard Chartered year ending 31 Dec 2016 page 77 refers.

http://iis.aastocks.com/20170224/002731275-0.PDF

Profit before taxation =   409 Mil
Taxation                   =   600 Mil
Loss for year             = (191) Mil

How can any tax be greater than the profit ?

Not all expenses are allowed to deduct from taxable income. An impairment charge is not. There is a huge impairment charge, before the PBT.