Standard Chartered is closing the bulk of its global equities business and axing 4,000 retail banking jobs as Peter Sands moves to aggressively cut costs to reverse the Asia-focused bank’s fortunes, according to a memo seen by Reuters.
As part of a cost-cutting plan, the bank is now dismantling its stock broking, equity research, and equity listing desks worldwide, cutting around 200 jobs and exiting a business that it views as non-core and unprofitable.
That is expected to save the bank around $100 million in 2016, while the memo said the lay-offs at its retail banking division will save $200 million in 2015.
The cuts come after rating agency Standard & Poor’s hit the London-based bank with its first ever credit rating downgrade in November following three profit warnings in less than 12 months and rising losses from bad loans.
Sands, who had achieved a decade of record profits up until 2013, is now under pressure from shareholders to turn Standard Chartered around and has promised to deliver $400 million of savings already in 2015.
“They announced the cost-saving plan last year and today they are carrying out the action. This would certainly help improve the bank’s profits,” said Steven Chan, an analyst at Maybank Kim Eng Securities in Hong Kong.