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Standard Chartered PLC 02888

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Standard Chartered's Q3 Result in Line, Lack of Further Capital Management Disappoints

Michael Wu, CAIA Senior Equity Analyst

Analyst Note

| Michael Wu, CAIA |

While Standard Chartered posted a good third-quarter result in line with consensus expectations, the bank’s share price declined sharply during London trading. In our view, the market was expecting further capital management initiatives at this result, after completing its USD 250 million share buyback announced at the second-quarter fiscal 2021 result. The bank remains well capitalised with higher profitability and a lower level of risk-weighted assets resulting in a 50 basis point increase in common equity Tier 1 ratio to 14.6%. This is above the bank’s target of 13% to 14% and management expects the common equity Tier 1 ratio to be at the top end of guidance at 14%. The bank noted further capital management is expected for the fiscal 2021 result with an intention to lower the common equity Tier 1 ratio to be at the lower end of the range closer to 13%.

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Company Profile

Business Description

Standard Chartered Bank was established in 1853 by Royal Charter in the United Kingdom, with the holding company Standard Chartered PLC incorporated in 1969. The bank is domiciled in the U.K., and provides banking services across 60 countries, primarily in Asia, Africa, the Middle East, and the United Kingdom. The bulk of the business is in corporate and transaction banking, financial markets, and corporate finance. The bank also has a strong retail franchise in Hong Kong, Singapore, and selective countries in Africa.

Contact
1 Basinghall Avenue
London, EC2V 5DD, United Kingdom
T +44 2078858888
Sector Financial Services
Industry Banks - Diversified
Most Recent Earnings Sep 30, 2021
Fiscal Year End Dec 31, 2020
Stock Type
Employees 84,740