The performance is largely a result of the bank’s wealth management unit and global banking
STANDARD Chartered lifted its income and returns outlook as it reported third-quarter profit that beat analysts’ estimates, boosted by a record quarter for wealth solutions.
Adjusted pre-tax profit rose to US$1.99 billion, beating the US$1.79 billion consensus analysts’ estimate compiled by Bloomberg. The performance was largely a result of the bank’s wealth management unit and global banking.
“We now expect to deliver an underlying return on tangible equity of around 13 per cent in 2025, hitting our target a year earlier than planned,” chief executive officer Bill Winters said in a statement on Thursday (Oct 30).
Like its larger rival HSBC Holdings, StanChart is in the midst of its own restructuring programme known as Fit for Growth that involves several hundred initiatives across the bank aimed at saving everything from a few hundred thousand to tens of millions of dollars.
The programme is now in the second of its three-year delivery phase, with much of the savings expected to come this year and the next. The bank reported a US$138 million charge related to the programme in the quarter.
The lender said income growth for 2025 is now expected to be towards “the upper end of the 5 to 7 per cent range” after previously guiding to around the bottom of the range. It also upgraded its guidance on return of tangible equity to “around 13 per cent” in 2025 from approaching 13 per cent in 2026.
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Income from global banking, including lending and capital markets, rose 24 per cent to US$588 million, while wealth solutions had a record quarter with income jumping 28 per cent.
Like many banks in Hong Kong, Standard Chartered is riding a boom in the wealth business as the lender is in the process of bolstering its wealth management arm.
A year ago, the bank said it was doubling its planned investment in serving affluent clients to US$1.5 billion over the next five years.
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The aim is to bring in US$200 billion of net new money into the bank between 2025 and 2029 and boost the share of its wealth and retail banking division’s income to three-quarters of the total.
Net inflows were US$13 billion in the quarter, with 67,000 new wealthy clients.
Credit impairments rose to US$195 million in the quarter, up from US$178 million a year earlier. BLOOMBERG
