Standard Chartered may have just issued a warning about the impact of the coronavirus on its 2020 revenue, but staff in some parts of the Asia-focused bank enjoyed a fruitful 2019. Meanwhile, average variable compensation for so-called material risk takers at the firm rose 17% year-on-year.
If you want to work in a Stan Chart division that looks comparatively well set to weather the coronavirus-driven storms this year (the bank says it’s unlikely to reach 2020 income growth targets of between 5% and 7%), try commercial banking. Underlying operating proﬁt of $448m in the unit (which serves local corporations and medium-sized enterprises) was up 100% year-on-year in 2019, “driven by income growth combined with lower costs and impairments”, according to Stan Chart’s annual financial results. Commercial banking experienced income growth in cash management, financial markets and lending products.
Employees serving larger clients in the corporate and institutional (CIB) banking division fared less well last year, although their results were far from dire. Profit was up 12% to $2,318m year-on-year, because of higher income from financial markets and cash management, and “prudent cost management”. The division has still been hiring, however. CIB appears to have taken on more tech and digital staff last year. It strengthened its focus on the “digital client experience” and its “talent pool” by establishing a digital channels and client data analytics division.
Stan Chart’s private bankers, many of whom are based in Singapore and Hong Kong, recovered from their annus horribilis in 2018 (in which their division made a $14m loss) to help private banking generate a profit of $94m in 2019. Assets under management increased $8bn (14%) year-on-year, mainly driven by $2.6bn of net new money and positive market movements. Compared with the likes of Credit Suisse, UBS and HSBC, however, Stan Chart remains a comparatively small player in Asian private banking, and the division only contributed about 2% of its annual profits.
It was a (fairly) good year to be within Stan Chart’s elite group of material risk takers (MRT) -- broadly defined as people who have a material impact on a bank’s risk profile. Fixed remuneration (salaries and cash allowances) per head for MRTs (excluding senior management) experienced a minor (1%) fall to €518,402 year-on-year in 2019. However, variable remuneration (both cash-based and deferred) was up 17% to €459,732 on average per head, according to figures calculated from Stan Chart’s annual results.
Photo by Arina Wong on Unsplash
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