Standard Chartered Signals Progress With $1 Billion Buyback Plan

By Margot Patrick 

Standard Chartered PLC is planning its first share buyback in two decades, in a signal of its return to health after a multiyear restructuring and the settlement of a sanctions probe.

The Asia-focused lender said it would start a $1 billion buyback program "imminently." The purchase plan reflects "confidence in our ability to execute the strategy and create long-term shareholder value," Chief Executive Bill Winters said. Its last share buyback was in 2002 when it repurchased preference shares.

The planned purchase marks the latest step forward for Standard Chartered since Mr. Winters started in June 2015 with a mandate to clean up the then-troubled lender. It resumed paying dividends last year after a hiatus to conserve capital and had said share buybacks would start soon.

On Tuesday, it reported first-quarter net profit of $818 million, up slightly from $803 million a year earlier. The figures included a charge of $186 million relating to its $1.1 billion settlement earlier this month with U.S. and U.K. authorities to settle allegations it violated sanctions on Iran and other countries. The bank has said it accepts full responsibility for the violations.

First-quarter revenue and expenses were broadly flat, while impairment charges were unusually low at $78 million compared with $191 million a year earlier, helped by a release of $48 million from an earlier charge taken against a single, unnamed client in its private bank.

Rapid Asian economic growth in the 2000s has helped Standard Chartered ride out the financial crisis but a slowdown in that growth and a sharp fall in commodities prices in 2014 left it with piles of bad loans. Mr. Winters led it in exiting businesses and unloading assets and has also sought to improve the bank's culture.

The bank in February said it would accelerate the continuing restructuring with more cost cuts, and by scaling back in mass-market retail banking in some countries to focus on wealth and digital banking.

Write to Margot Patrick at [e-mail]

(END) Dow Jones Newswires

April 30, 2019 03:54 ET (07:54 GMT)

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