Standard Chartered CEO Bill Winters is getting out his axe, especially in Asia. His bank now aims to trim $700m in costs over the next three years and restructure underperforming businesses in markets such as India, Indonesia and South Korea.
Last year the Asia-focused bank culled 1,000 jobs, but its headcount still stood at 85,000 at the end of December. Stan Chart’s 2018 cost-to-income ratio of 69.9% is only a marginal improvement from 2017 (70.8%). The expectation, therefore, is that more roles will need to go.
If you work for Stan Chart in its Asian hubs of Singapore and Hong Kong (or if you’re looking for a job there), you will want to be in a unit that’s growing, not shrinking. The bank’s 2018 annual report, released today, provides some clues as to Stan Chart’s most secure teams in the two cities.
Stan Chart spent $1.6bn on technology last year, up from $900m in 2015. But investment into its legacy tech systems flatlined during that time. If you want to work in technology at the bank, it’s now much better to be in a ‘strategic’ or ‘systems enhancement’ role (i.e. emerging technology) – costs in these two categories have trebled from $300m to $900m over three years. If you want a blockchain role, for example, Stan Chart is partnering with Ant Financial in blockchain cross-border remittance. In AI and machine learning, its key projects include financial crime surveillance tools and automated client onboarding.
“Fintechs are our friends,” Winters said today, adding that partnering with them enables Stan Chart to compete on the tech front with larger banks. Where to work if you want to benefit from Winter’s new focus on fintech collaboration? Your best bet is SC Ventures, the bank’s innovation hub in Singapore, which developed more than 50 proof of concepts with fintech firms last year.
Hong Kong private banking
Stan Chart has been adding more relationship managers in Asia since 2016 when it recruited Didier Von Daeniken from Barclays as its Singapore-based global private banking head. It’s since upped its private-client investment threshold to $5m and is targeting ultra-high-net-worth RMs as a result. In Stan Chart’s Greater China and North Asia region, for which Hong Kong serves as a hub, this strategy appears to be paying off – private banking revenues were up 13% year on year in 2018.
Earlier today, Winters singled out priority banking (focused on the emerging affluent, who don’t qualify for private banking services) as a “key differentiator” helping to grow revenue at Stan Chart. This suggests more RM jobs may soon open up within priority banking in Singapore and Hong Kong, two key centres for affluent clients. Stan Chart attracted more than 51,000 new priority clients in Hong Kong last year, and revenues were driven by wealth management products rather than loans.
Financial institutions banking
Part of Winters’ business strategy for Stan Chart involves focusing on sectors in which the firm is already successful. In the corporate and investment bank, that primarily means financial institutions clients. Network income from that segment increased by 14% in 2018 and 17% in 2017, and Winters singled it out as another of his key differentiators. This suggests there will be hiring rather than firing in financial institutions this year.
The compliance hiring boom shows no sign of slowing down at Stan Chart, which has long been one of the largest middle-office recruiters in Hong Kong and Singapore. Perhaps this is not surprising given that Stan Chart has set aside $1bn for regulatory fines. Last year Stan Chart established “a multi-year programme” to review and strengthen its compliance structures and processes. The bank is also pampering its compliance professionals. It rolled out an “enhanced learning programme” and a “progressive development path” for them in 2018, according to its annual report.
As we’ve been reporting since its launch in August, Project Dragon (the code name for Stan Chart’s new digital bank that awaits regulatory approval in Hong Kong) has been hiring technologists. And if you’re based in the unit it appears you are now at the cutting edge of tech development at Stan Chart. The “best ideas” from Project Dragon’s tech “package” will be imported across the firm, CEO Winters said today.
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