Financial Results
Profits Rise At Standard Chartered's Wealth, Retail Arm; Group Results Sparkle
Among the details, the UK-listed bank said it intends to invest about $1.5 billion over five years in building out its roster of investment advisors and RMs, wealth solutions, and other capabilities.
The wealth and retail banking arm of Standard Chartered reported a rise of profit in the third quarter to $742 million, rising 11 per cent on a year earlier. For the nine months to end-September, they rose 5 per cent to $2.149 billion. At the group level, pre-tax profit surged by more than a third.
The wealth solutions business enjoyed rising earnings from products, partly offset by lower deposits' income. Expenses rose 4 per cent, while credit impairment in the third quarter rose to $62 million.
Net new sales in the wealth business stood at $5 billion in the quarter, rising 13 per cent year-on-year.
The UK-listed bank, which earns the bulk of its revenues outside the UK, said it intends to invest around $1.5 billion over five years in relationship managers and investment advisors, wealth solutions, and enhanced advisory, cross-border and digital capabilities. This represents a doubling of investment relative to its previous plans, Standard Chartered said. “The incremental investment will be funded by reshaping our mass retail business to focus on building a strong pipeline of future affluent and international banking clients,” it continued.
Group results
Looking ahead, Standard Chartered said it expects operating
income to increase at 5 to 7 per cent compound annual growth rate
in 2023 to 2026 on a constant currency basis; 2025 growth is
expected to be below the 5 to 7 per cent range.
On a reported basis, pre-tax profit rose 37 per cent year-on-year to $1.807 billion. On an attributable basis, profit surged 56 per cent to $1.005 billion. At the end of September, the Common Equity Tier 1 ratio stood at 14.2 per cent, a rise of 30 basis points on a year earlier.
“We are increasing both our 2026 RoTE [return on tangible equity] target from 12 per cent to approaching 13 per cent, and our shareholder distribution target from at least $5 billion to at least $8 billion from 2024 to 2026,” Bill Winters, CEO, said.
