Standard Chartered to repurchase $1.5B in shares after reporting 18% profit surge

Standard Chartered announced a $1.5 billion share buyback on Friday alongside an upgraded earnings target, following an 18% surge in annual profit.

The bank attributed the strong performance to record growth in its wealth management division and robust market activity.

Standard Chartered expects its key markets across Asia, Africa, and the Middle East to outpace global growth, positioning the bank for long-term expansion, CEO Bill Winters said in its earnings statement on Friday.

The London-based lender reported a 2024 pretax profit of $6 billion, marking an 18% increase from $5.1 billion the previous year.

However, the figure came in slightly below the $6.2 billion analyst consensus compiled by the bank.

Following the earnings announcement, StanChart’s Hong Kong-listed shares trimmed earlier losses, trading 0.45% lower on Friday afternoon, recovering from a nearly 2% drop in the morning session.

The broader market, buoyed by optimism in Chinese tech stocks, climbed 3.3%.

Expansion plans and wealth management growth

To accelerate income growth, StanChart plans to invest $1.5 billion over the next five years in wealth management, digital platforms, client services, personnel, and brand marketing.

“We believe our strategic investments and enhanced focus will position us to outperform the market in terms of asset accumulation and income growth over the medium term,” Winters stated.

The bank aims to generate $200 billion in net new money from 2025 to 2029, targeting a double-digit compounded annual growth rate in wealth solutions income between 2024 and 2029.

In 2024, StanChart onboarded 265,000 new wealthy clients, bringing in a total of $44 billion in fresh funds, a 61% increase year-over-year.

Share buyback and dividend payout

The bank announced a final dividend of 28 cents per share and unveiled a $1.5 billion share buyback program, surpassing initial expectations of around $1 billion.

Michael Makdad, a senior market analyst at Morningstar, noted that the larger-than-expected buyback reflects the bank’s confidence in its financial position.

StanChart’s results align with those of rival HSBC, which recently reported a 6.6% rise in annual pretax profit, slightly exceeding forecasts.

HSBC’s wealth and personal banking division also saw a 5.2% profit increase year-over-year.

Both banks are working to expand fee-based revenue streams like wealth management to offset potential declines in net interest income, as global central banks begin cutting interest rates, squeezing lending margins.

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