HONG KONG: Standard Chartered upgraded key performance targets as its quarterly profit topped market estimates, and said it will double down on its wealth business while slashing back retail banking in a bid to further boost returns.
StanChart said its third-quarter pretax profit reached US$1.72 billion, above an average analyst forecast of US$1.49 billion and more than double the year-earlier number of US$633 million when it took a nearly US$1 billion hit from its exposure to China.
Income this year will now grow by around 10 per cent, the bank said on Wednesday, up from a previous estimate of towards 7 per cent. The lender also said it plans to return at least US$8 billion to shareholders over 2024-2026, up from US$5 billion.
The improved performance came as StanChart, like rival HSBC , continues a sweeping restructuring of its business to focus more on affluent individual customers and big cross-border businesses that are likely to yield more in fees for the bank.
StanChart said it will double investment in its wealth business, investing US$1.5 billion over five years in relationship managers and investment advisers.
That will be funded by cutting more of its mass retail business, following HSBC which in recent years has slashed its retail banking operations in Western markets such as the US, Canada and France to focus on more lucrative areas.
StanChart said it is exploring the opportunity to sell “all or part of a small number of businesses” which no longer make strategic sense.
The London-headquartered bank did not announce a fresh share buyback for the quarter, unlike HSBC.
StanChart’s shares rose 3.3 per cent in Hong Kong after the results, as it joined European peers in making robust progress on sustaining profits even as rates fall.
The lender’s shares in London have soared 31 per cent