Standard Chartered unveils share buybacks but cautions over turnaround delay

Emerging markets-focused bank Standard Chartered has unveiled more than one billion US dollars (£736 million) in shareholder returns, but warned its turnaround is taking longer than expected due to the pandemic.

The group is “imminently” launching a 750 million US dollar (£552 million) share buy-back and a final dividend payout worth 277 million US dollars (£204 million).

This failed to boost shares, which sank 4% as annual profits fell short of expectations, despite more than doubling to 3.3 billion US dollars (£2.4 billion) in 2021, from 1.6 billion US dollars (£1.2 billion) the previous year.

Standard Chartered narrowed pre-tax losses in the final three months of the year to 208 million US dollars (£153 million) from 449 million US dollars (£330 million) a year earlier.

Group chairman, Jose Vinals, said: “While the pandemic brought about considerable challenges and, as a result, the turnaround is taking longer than previously anticipated, it is clear to us that the refreshed strategic priorities we set out at the start of 2021 are right.”

The London headquartered lender sparked a shares slide last November when it cautioned over an “uneven” recovery from the pandemic in some of its main markets as the supply chain crisis was also in full swing.

Bill Winters, chief executive of the bank, said the group had committed to a “set of far-reaching actions, to deliver a return on tangible equity of 10% by 2024”.

He added: “Our refreshed strategy has proved resilient and delivered our return to growth in the second half of 2021.”

The group’s results also revealed that cash set aside for bad loans fell by 2 billion US dollars (£1.5 billion) year-on-year to 263 million US dollars (£194 million).

But this was a rise of 96 million US dollars (£71 million) on the previous quarter.

Standard Chartered’s annual report, also published on Thursday, showed that after cutting bonuses in 2020 amid the Covid crisis, it increased payouts for 2021, particularly after a strong showing from its investment bank.

The group paid out 1.4 billion US dollars (£1 billion) in bonuses across the group, up 38% on 2020.

Chief executive Bill Winters saw his total pay jump to 4.7 million US dollars (£3.5 million) from 3.9 million US dollars (£2.9 million) in 2020.

The report showed that 175 bankers earned more than a million euros (£835,000) and one of its top investment bankers, based in Hong Kong, made nearly 12 million US dollars (£8.8 million) last year.