Standard Chartered is expected to spend about $.3 billion to buy back its shares after seeing quarterly profits that were higher than what analysts were expecting. The bank, based in London, announced on Thursday that the repurchase is part of a bigger plan to return about $8 billion to shareholders between 2024 and 2026.
The bank had already launched a $1.5 billion buyback at the start of the year, making this its second in the last six months. The second quarter results showed a pretax profit of about $2.4 billion in the last three months ending June 30, topping the $1.9 billion estimate tracked by Bloomberg. Standard Chartered also said its stock traded at about £13.70 in London by Thursday, showing a gain of over 30% this year, despite taking a hit earlier in April when US President Donald Trump announced new global tariffs under what he called “Liberation Day.”
Clients bring in $16 billion as Standard Chartered slashes costs
Aside from its profits being on the rise, Standard Chartered also revealed that its wealth division brought in $16 billion in new client assets during the quarter, an all-time high. This cash helped push pre-tax profits up by 44%, compared to the same time last year. In total, the bank saw about $2.3 billion in quarterly profits, higher than the $1.6 billion it saw last year, and the $1.7 billion that analysts had predicted.
The bank’s key profitability metric, return on tangible equity, also jumped to 17.9%, beating expectations of 11.7%, and improving from 10.4% in the same quarter a year ago. In addition, Standard Chartered says it is still in a $1.5 billion cost-cutting program called “Fit for Growth.” That initiative is focused on making the bank leaner by trimming unnecessary expenses and dumping underperforming operations. These cost reductions range in size from small fixes worth a few hundred thousand dollars to major moves costing tens of millions.
Around half of the costs are set to be hit this year, with the bank set to focus on additional information because it plans to shut down non-core business and scale down infrastructure, reducing property costs. CEO Bill Winters, who just marked his 10th anniversary running the bank last month, has been driving most of these changes. His tenure hasn’t been quiet. In the past decade, Bill has overseen multiple changes, launched a series of reorganisations, and cut thousands of jobs as part of a broader strategy to reduce risks and get the bank back on track.
He has also been taking the bank through tricky markets in Asia, Africa, and the Middle East, where Standard Chartered has its deepest roots. “We’re performing well, while keeping a tight grip on costs, credit risk, and capital,” Bill said in Thursday’s earnings statement. “Our strong first-half performance reflects continued successful execution of our strategy, through our focus on cross-border and affluent banking.”
He added, “Through our unique network across Asia, Africa, and the Middle East, we offer our clients the means to navigate volatile external conditions.” While the broader banking sector continues to wrestle with rising political risk amid the fallout from Trump’s trade war, Standard Chartered is hoping that tightening operations and returning cash to investors is the right path forward. The bank is presently staying aggressive on both fronts by cutting costs and buying back shares, as the environment becomes more predictable.
