Standard Chartered expanded its multi-billion-dollar share buyback program as the bank reported a rise in pretax profits driven by its wealth business.
The London-headquartered lender said in a statement Tuesday that it will repurchase a record US$1.5 billion ($2.02 billion) as it looks to return a total of US$5 billion to shareholders by 2026.
It reported second quarter pretax profit of US$1.83 billion, beating analyst estimates of US$1.6 billion. The lender raised its outlook for income growth, and is now expecting operating income to rise more than 7% in 2024. Operating income from wealth solutions jumped 25%, thanks to net new sales and affluent new to bank customers.
“We produced a strong set of results for the first half of the year, demonstrating the value of our franchise as a cross-border corporate and investment bank and a leading wealth manager for affluent clients,” chief executive officer Bill Winters said in a statement.
Standard Chartered is in the midst of a fresh cost-cutting program called “Fit For Growth” that aims to save the bank about US$1.5 billion over the next three years. The plan incorporates more than 200 individual initiatives within the company that are aimed at trimming annual expenses by anything from a few hundred thousand to millions of dollars.
Operating expenses in the second quarter slid due lower investment spending. The bank has pledged to cap annual costs at US$12 billion in 2026 against a base of US$11.1 billion last year.
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Around 50% of the “Fit For Growth” projects identified are “in execution”, or ready to start, with the plan to have them all in execution by the end of this year, the lender said.
The bank has already embarked on a revamp of the management in its corporate and investment banking arm that includes stripping out layers of regional management in an effort to speed up decision making and make managers more accountable for the performance of their businesses.
For Winters, the shake up comes in his 10th year as boss of the emerging markets-focused bank, a tenure that makes him the longest-serving CEO of any major UK-based lender.
Winters has in the past played down talks of him leaving the bank any time soon, telling reporters three years ago that “the job is not yet done”.
