Standard Chartered’s first quarter results have been hailed as proof that CEO Bill Winter’s turnaround strategy is finally starting to work. The bank has announced a new $1bn share buyback, a 10% rise in quarterly profit, and (crucially) a 2% fall in operating expenses.
Stan Chart’s cost cutting is far from over, however. The firm, which generates about two thirds of its income from Asia, announced in February that it wants to slash spending by $700m over the next three years. If you work for Stan Chart in its hubs of Singapore and Hong Kong (or if you’re looking for a job there), you’ll want to be in a unit that’s growing, not shrinking. Stan Chart’s Q1 results, released today, provides some clues about its best (and worst) performing teams.
Join Stan Chart’s virtual bank in Hong Kong
As we’ve been reporting since its launch in August, Stan Chart’s new digital bank has been on a hiring spree – taking on people from technologists to strategists. Earlier this year, for example, Andrew Farmer came on board as chief information officer, having previously been a CIO at Commonwealth Bank. Expect more recruitment to follow throughout this year. Stan Chart will continue “incurring costs” this year as it builds the platform, which received regulatory approval last month, said chief financial officer Andy Halford.
Take it easy in transaction banking
If you’re looking for a stable (but slightly mundane) job at Standard Chartered, look no further than transaction banking, where income was up 5% year on year in the first quarter. Within transaction banking, you’ll want to focus on the dominant cash management product, which enjoyed a 14% rise in income to $602m.
Forget legacy tech
Stan Chart’s Q1 results don’t reveal any specifics about its technology jobs, but they do state that the firm will “invest significantly” into its “digital capabilities”. What kind of tech roles might this investment create? Stan Chart’s 2018 annual report, released in February, provides some suggestions. The bank spent $1.6bn on tech last year, up from $900m in 2015, but investment into its legacy systems flatlined. 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 over three years. If you want a blockchain job, for example, Stan Chart is partnering with Ant Financial in cross-border remittance. In AI and machine learning, its key projects include financial crime surveillance tools and automated client onboarding.
Private banking: too small to attract the best RMs?
Yes, income from Stan Chart’s private banking division grew 3% compared with Q1 last year, and the unit attracted more than $1bn in net new money. But despite being an Asian-focused bank, Stan Chart remains a comparative minnow in this competitive sector – private banking only contributed 4% of its total income in Q1. In contrast, private banking dominated Q1 revenues at Credit Suisse in Asia. According to new Asian Private Banker data, Stan Chart’s Asia-based relationship managers looked after $137m on average in 2018 – the lowest figure for any private bank in the region. As we reported earlier this month, Stan Chart’s lack of scale and its reputation as a ‘retail bank’ sometimes hinder its ability to hire RMs in Singapore and Hong Kong.
You should trade rates or FX
Standard Chartered may have shuttered its equities unit back in 2015, but its remaining financial markets operations are performing reasonably well – markets income edged up 3% year on year to $749m in Q1. If you want to work in markets at Stan Chart, rates and foreign exchange are currently your best options – income rose by 25% and 20%, respectively, for those products.
Wealth management: in recovery
It’s been a difficult 12 months if you’ve been selling retail wealth management products – income was down 14% year on year in Q1, reflecting better market conditions in early 2018. This slump in wealth was a major contributor to Stan Chart suffering declines in Q1 income from its two most important regions: Greater China and North Asia; and ASEAN and South Asia. But there are now signs that 2019 may be less stressful. Quarter-on-quarter income was up 22%, prompting CFO Halford to say that “wealth management has been doing well” so far this year.
Image credit: mtcurado, Getty
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